Reader’s Question:

A local insurance company in Alabama offers coverage for a universal life insurance. Does a universal life insurance policy assure of a fixed premium for the whole term?

Nick

Huntsville, AL

Good Question Nick.

No. The insurance policy can increase charges since it offers greater flexibility compared to the Alabama whole or term life policy. With a universal life insurance policy, you can make changes while the policy is in force. Even after your initial payment, you can still reduce or increase the amount of your death benefits and even pay premiums any time and in any amount, as long as you don’t miss a minimum payment. Because of this flexibility, insurance companies can increase charges at any time during your term.

Though offering greater flexibility in terms of making changes while the policy is in force, the Alabama universal life insurance policy can have many moving parts which should be understood before you make the purchase. For example, if you choose to increase your benefits, you may have to provide medical proof that your health has not deteriorated. You can also pay premiums any time and in any amount, but in some cases, there are limits to how much extra you can pay in advance premiums.

Ask your local insurance company in Alabama for details on the moving parts of their universal life insurance.