Uses of Universal Life Insurance

* Final expenses, such as a funeral, burial, and unpaid medical bills

* Income replacement, to provide for surviving spouses and dependent children

* Debt coverage, to pay off personal and business debts, such as a home mortgage or business operating loan

* Estate liquidity, when an estate has an immediate need for cash to settle federal estate taxes, state inheritance taxes, or unpaid income in respect of decedent (IRD) taxes.

* Estate replacement, when an insured has donated assets to a charity and wants to replace the value with cash death benefits.

* Business succession & continuity, for example to fund a cross-purchase or stock redemption buy/sell agreement.

* Key person insurance, to protect a company from the economic loss incurred when a key employee or manager dies.

* Executive bonus, under IRC Sec. 162, where an employer pays the premium on a life insurance policy owned by a key person. The employer deducts the premium as an ordinary business expense, and the employee pays the income tax on the premium.

* Controlled executive bonus, just like above, but with an additional contract between an employee and employer that effectively limits the employees access to cash values for a period of time (golden handcuffs).

* Split dollar plans, where the death benefits, cash surrender values, and premium payments are split between an employer and employee, or between an individual and a non-natural person (e.g. trust).

* Non-qualified deferred compensation, as an informal funding vehicle where a corporation owns the policy, pays the premiums, receives the benefits, and then uses them to pay, in whole or in part, a contractual promise to pay retirement benefits to a key person, or survivor benefits to the deceased key person's beneficiaries.

* An alternative to long-term care insurance, where new policies have accelerated benefits for Long Term Care.

* Mortgage acceleration, where an over-funded UL policy is either surrendered or borrowed against to pay off a home mortgage.

* Charitable gift, where a UL policy is donated to a qualified charity, or the policy owner names a charity as the beneficiary.

* Charitable remainder trust replacement, where a policy owner wants to replace assets donated to a Charitable Remainder Trust.

* Estate equalization, where a business owner has more than one child, and at least one child wants to run the business, and at least one other wants cash.

* Life insurance retirement plan, or Roth IRA alternative. High income earners who want an additional tax shelter, with potential creditor/predator protection, who have maxed out their IRA, who are not eligible for a Roth IRA, and who have already maxed out their qualified plans.

* Term life insurance alternative, for example when a policy owner wants to use interest income from a lump sum of cash to pay a term life insurance premium. An alternative is to use the lump sum to pay premiums into a UL policy on a single premium or limited premium basis, creating tax arbitrage when the costs of insurance are paid from untaxed excess interest credits, which may be crediting at a higher rate than other guaranteed, no risk asset classes (e.g. certificates of deposit or U.S. Savings Bonds).

* Whole life insurance alternative, where there is any need for permanent death benefits, but little or no need for cash surrender values, then a current assumption UL or GUL may be an appropriate alternative, with potentially lower net premiums.

* Annuity alternative, when a policy owner has a lump sum of cash that they intend to leave to the next generation, a single premium UL policy provides similar benefits during life, but has a stepped up death benefit that is income tax-free.

* Pension maximization, where permanent death benefits are needed so an employee can elect the highest retirement income option from a defined benefit pension.

* Annuity maximization, where a large non-qualified annuity with a low cost basis is no longer needed for retirement and the policy owner wants to maximize the value for the next generation. There is potential for arbitrage when the annuity is exchanged for a single premium immediate annuity (SPIA), and the proceeds of the SPIA are used to fund a permanent death benefit using Universal Life. This arbitrage is magnified at older ages, and when a medical impairment can produce substantially higher payments from a medically underwritten SPIA.

* RMD maximization, where an IRA owner is facing required minimum distributions (RMD), but has no need for current income, and desires to leave the IRA for heirs. The IRA is used to purchase a qualified SPIA that maximizes the current income from the IRA, and this income is used to purchase a UL policy.

* Creditor/predator protection. A person who earns a high income, or who has a high net worth, and who practices a profession that suffers a high risk from predation by litigation, may benefit from using UL as a warehouse for cash, because in some states the policies enjoy protection from the claims of creditors, including judgments from frivolous lawsuits.

* Cryonics funding, where a life insurance policy funds the costs associated with cryonic suspension.

Similar Life Insurance Types

A similar type of policy that was developed from universal life policies is the variable universal life insurance policy (VUL). VUL allows the cash value to be directed to a number of separate accounts that operate like mutual funds and can be invested in stock or bond investments with greater risk and potential reward. Additionally, there is the recent addition of equity-indexed universal life contracts analogous to equity-indexed annuities that invest in index options on the movement of an index, such as the S&P 500, Russell 2000, and the Dow Jones (to name a few). These type of contracts only participate in the movement of the index and not the actual purchase of stocks, bonds or mutual funds. They may have a cap (but not always do) as to the maximum amount they will credit interest to and a minimum guarantee which keeps the principal of the contract from losing money in a down year. Typically each year the starting point is last year's ending point which means that: (1) the policy amount is locked in at the end of the year; and, (2) the beginning value from which the movement measured is reset.

Universal life is similar in some ways to, and was developed from whole life insurance.[1] The advantage of the universal life policy is its premium flexibility and adjustable death benefits. The death benefit can be increased (subject to insurability), or decreased at the policy owner's request.

The premiums are flexible, from a minimum amount specified in the policy, to the maximum amount allowed by the contract. The primary difference is that the universal life policy shifts some of the risk for maintaining the death benefit to the policy owner. In a whole life policy, as long as every premium payment is made, the death benefit is guaranteed to the maturity date in the policy, usually age 95 to age 121. A UL policy will lapse when the cash values are no longer sufficient to cover the cost of insurance and policy administrative expense.

To make UL policies more attractive, insurers have added secondary guarantees, where if certain minimum premium payments are made for a given period, the policy will remain in force for the guarantee period even if the cash value drops to zero. These are commonly called "No Lapse Guarantee" riders, and the product is commonly called guaranteed universal life (GUL, not to be confused with group universal life insurance, which is also typically shortened to GUL).

The trend up until 2007–2008 was to reduce premiums on GUL to the point where there was virtually no cash surrender values at all, essentially creating a level term policy that could last to age 121. Since then, many companies have introduced either a second GUL policy that has a slightly higher premium, but in return the policy owner has cash surrender values that show a better internal rate of return on surrender than the additional premiums could earn in a risk-free investment outside of the policy.

With the requirement for all new policies to use the latest mortality table (CSO 2001) beginning January 1, 2009, many GUL policies have been repriced, and the general trend is toward slight premium increases compared to the policies from 2008.

Another major difference between universal life and whole life insurances: the administrative expenses and cost of insurance within a universal life contract are transparent to the policy owner, whereas the assumptions the insurance company uses to determine the premium for a whole life insurance policy are not transparent.

Universal life insurance

Universal life insurance (often shortened to UL) is a type of permanent life insurance based on a cash value. That is, the policy is established with the insurer where premium payments above the cost of insurance are credited to the cash value of the policy. The cash value is credited each month with interest, and the policy is debited each month by a cost of insurance (COI) charge, as well as any other policy charges and fees which are drawn from the cash value if no premium payment is made that month. The interest credited to the account is determined by the insurer; sometimes it is pegged to a financial index such as a stock, bond or other interest rate index.

Term, Whole and Universal Life Insurance Quotes Made Easy

Life insurance quotes from local agents are the best way to determine the amount of coverage you need, the best type that is right for your situation and what policy has the most affordable rates for your specific needs. When you compare life insurance quotes online from multiple companies, you are more likely to find the policy you need for the low cost price you want. Get started choosing the best policy at an affordable rate by entering your basic information in the online form above. You will be contacted by local agents from a nationwide network companies offering you free life insurance quotes for the best policies at the cheapest rates. Simply choose the life insurance quote that is right for you. It's that easy to protect your family, care for your loved ones and leave a lasting legacy.

It's understandably difficult for any family to consider death and making arrangements for it. When this occurs, dealing with the emotional trauma is hard enough. By having the financial preparations planned and under control with comprehensive life insurance coverage, it makes the situation that much easier for your loved ones left behind. By having a life insurance policy in place, your loved ones will be protected from financial hardships. The protective qualities of your policy will provide money directly to your beneficiaries. This settlement from the company that insures you can be used by your beneficiaries in any way they see fit, such as:

* Supplement lost income
* Funds for children's education
* Pay off the family household debt
* Pay for the cost of the funeral and related expenses
* If you choose to buy a permanent policy, you can have the option of adding a cash value component. This cash value component can be used during your lifetime if needed.

Types of Policies

Before you compare life insurance quotes online, you will first want to consider what type of coverage that you need in a policy. The following are your basic options:

Term Life Insurance: Term life insurance is temporary coverage that is generally more simplified when you compare with other choices. There is no cash value option and when you compare online life insurance quotes from companies, you will typically find the cheapest rates for term life insurance.

Whole Life Insurance: Whole life insurance is permanent coverage with guaranteed premiums, meaning your rates do not change over time. Whole policies also offers death benefits and cash value that accumulates over the lifetime of the policy. When you are doing a comparison of quotes for term vs. whole, it is typical to find that whole offers more coverage in their policies than term does; but you will also find that the life insurance quotes are not as low cost.

Variable Universal Life Insurance: Variable universal policies are a type of permanent coverage that may offer a higher cash value if you choose some of the offered investment options. However, you will be accepting some risk with these investments. You can learn more about this option below and by talking to agent when you compare your free life insurance quotes.
Term Life Insurance Quotes

When you compare free online life insurance quotes, you will likely find that term policies will give you an affordable way to have a temporary and protective policy for your loved ones. It also is flexible and allows you to change your term policy to meet your more permanent goals. If you are looking for affordable rates to get the most coverage and you know what specific financial responsibility you want covered, such as a mortgage or education expenses for your children, than a term policy might be the best type of coverage for you. However, there are a few items that you may want to consider when getting term life insurance quotes. There is no cash value accumulation and if you choose to continue coverage after the initial level premium-paying term expires, it can be extremely expensive.

Term vs Permanent Life Insurance
When many people start to research their options and get free life insurance quotes, one of the first items they need cleared up is the difference between term vs. permanent life insurance. If you are only interested in cheap coverage for a limited amount of time, term coverage may be right for you. Term life insurance will last long enough to meet your anticipated responsibilities to those loved ones who depend on you, but not for a longer period of time. Term life insurance is for temporary responsibilities, such as a mortgage or your child's education. On the other hand, a permanent policy offers more security, flexibility, lifetime coverage and cash value. When you compare free online quotes, you will see that this options is not as cheap and may not be as affordable as term policies.

Term life insurance policies are generally considered protective policies because they are designed to provide financial protection to beneficiaries in the event of a covered event. This settlement is usually in a lump sum payment. Types of permanent life insurance, such as whole, universal and variable life insurance policies are typically considered investment policies because the main objective is to facilitate the growth of capital by regular or single premiums. Learn about term coverage highlights so you can better discuss policies and rates when you compare quotes from agents.

Term Life Insurance Highlights

* Temporary coverage for a specified period of time
* Easy to understand
* More affordable option
* May be the cheapest way to obtain valuable coverage
* Becomes increasingly expensive over time
* No option to build equity or accumulate cash value

Permanent Life Insurance Highlights

* Coverage lasts your whole lifetime if premiums are paid
* You can build equity, cash value
* Flexibility allows you to customize plans to meet your specific needs
* Initially premiums are higher than term coverage, but the longer you maintain your premiums, the more cost-effective, affordable and financially beneficially the investment becomes.

Term Life Insurance Pros and Cons
When getting free online quotes, you will find that while there are many benefits to term life insurance, there are also some down sides. There are three main reasons to choose term coverage over other permanent options: it's cheap, it's easy to buy and it covers temporary needs. The cons are that is expires and you can outlive or cancel your policy at any time but you will receive nothing for the years of paying into it.

Term Pros:
Term life insurance has cheap rates. Term coverage is the most affordable option, which you will quickly discover when getting your free quotes. For instance, a 45-year-old male who does not smoke could buy a million-dollar, 30-year term coverage policy for about $200 a month.

Term life insurance is easy to buy. In addition to being the cheapest, term policies are the least complicated to understand. You simply need to consider how much you need and for how long, and then you jump online and get free life insurance quotes from local agents at multiple companies. Since agents will be competing for your business, all you need to do is sit back and listen to what rates they have to offer. Compare quotes and prices then choose the low cost term policy that is best for you.

Term life insurance is temporary. Life insurance is intended to financially provide for your dependents. You may not always have dependents. As your children grow-up and become self-sufficient and as your spouse continues to save for retirement, your income will not be needed as much as you age. As such, you can start a term policy when your first child is born and keep it for 30 years. If needed, this low cost coverage can be increased as you have more children.

Term Cons:
Term life insurance expires. Although it can be a positive that term coverage is only temporary, before you compare quotes and buy a policy, you must consider that it also has it's negative aspects. If you find at the end of your purchased term you still need coverage, than you will not get anything out of the plan you have been paying into for so many years. If after 30 years your term coverage expires, but you lost your retirement funds or your spouse becomes ill and you need the extra cash, you would need to start from scratch on building up your coverage for your dependents. If you are getting quotes for life insurance for seniors, you may find that the older you are, the more difficult it becomes to obtain a term policy that is affordable and will work for you. If you are not in good health, you may not be able eligible for coverage. As you age, you will most likely want to look life insurance for seniors and compare quotes that offer coverage with no medical exam necessary.

Term life insurance is not an investment. If you outlive your term policy or cancel it, which you can do at any time, you will get nothing back. There is no cash value accumulation as offered in permanent, universal or whole policies. If everything turns out the way you (and the company covering you) plan, you will live into old age and never use your term coverage. The term limit will end and it will never have been used. This means you will have paid into the policy thousands or tens of thousands of dollars to a company for a term policy you never used. You do not get any refunds, and as such, some people feel they have wasted their money. On the other hand, it is better to have some coverage if things don't go the way you plan in order to have a protective policy for your family. However, by going with low cost term coverage, which is the cheapest of the types of policies, you will have saved money on premiums over the period of time.

Talk to an agent about your options and get life insurance quotes on both permanent and term policies. If term is right for you, you can get low cost term rates and gain the benefits of these protective policies. Getting the right coverage for your specific situation is important. This starts by knowing how much coverage you need and what is affordable for your family. Before getting life insurance quotes, you can fill in your basic information in the online form and you can get a more accurate estimate for your life insurance quotes. Your agent will use a life insurance calculator to give you the best quotes. The life insurance calculator will use your income, debts and assets to get an instant estimate on how much coverage you need and what your premiums will cost. Then an agent from a reputable company can alter this estimate and get you a quote to include your specific concern and needs. This is how a life insurance calculator will help you get the best quote for your lifestyle.
Whole Life Insurance Quotes

When you fill in the online form to get free quotes, you may want to consider whole life insurance policies. A whole policy is the simplest form of permanent coverage and offers lifelong protection with guaranteed premiums, death benefits and cash value. Whole is not as cheap as term but it offers coverage for your entire lifetime rather than the length of the policy, unless you cancel it. Whole offers fix premiums that will never increase, a guaranteed death benefit payout and tax-deferred cash value that accumulates annually. Over time, the dividends can be used to increase the value of your policy or even pay for your premiums.

A few items you may consider as draw backs when it comes to whole policies are that the premiums initially cost more than term coverage but they are guaranteed not to increase over the length of your policy. Although it can be a good investment dividends are not guaranteed. It is beneficial that you can make withdrawals and take loans from your policy, but it can reduce the death benefit payout to your beneficiaries.
Universal Life Insurance Quotes

You will likely do a comparison of multiple life insurance quotes after you fill in the online form to obtain free quotes. When looking for affordable and cheap quotes, universal policies may appear. Universal policies are a form of permanent coverage that provide low cost and affordable rates in guaranteed protective policies that are flexible. Universal policies give you the ability to change, within your limits, the death benefit, timing and amount of your premium. You can choose to increase your cash value or choose to pay a lower premium and have your dollars focused on guaranteed protection.

There are some items you may want to consider when you compare online and before you buy a universal policy. A universal policy is a little more complicated than a whole policy. Cash value growth is based on fixed interest rates that are periodically-declared. This means that if rates fall, cash value accumulation that you have worked toward could also suffer and the cost of higher premiums may need to be paid. If you feel the need to change the cost of your premiums or death benefit, this alteration could affect your policy's performance and guarantees, which could also call for higher premiums in the future.
Variable Universal Life Insurance Quotes

When getting online quotes for variable universal coverage, there are a few items you will want to think about when talking with an agent from any of the nationwide companies. This kind of permanent coverage has flexible terms and investment options. Like universal policies, variable universal coverage allow flexibility, within limits, to change the death benefit, and the timing and amount of your premiums. However, these policies also allow you to invest your cash value in funding options that are managed by professional investors. A variable universal policy may be the best choice for you if you are interested in protection that lasts a lifetime, flexibility with changes in your circumstances and cash value with investment options.

When you compare online life insurance quotes between different variable universal policies, you will want to consider the possibly negative aspects of this type of coverage. This option does offer an investment aspect, and as with any investment, the value of the funding options will fluctuate with market changes. There is potential for growth but this does not come without risk of loss. Additionally, if you miss or are late on your premiums, this can affect the cash value and death benefit of your policy. It may also cause the price of your premiums and rates to increase in the future.
Compare Life Insurance Quotes

When you compare life insurance quotes, coverage, policies and rates, be sure to take many factors into consideration. You will first want to consider your specific situation and then determine the best plan that fits your needs as you are filling out online forms to get free quotes. An online calculator may help you decide what life insurance quote is the most beneficial and affordable. Talk to multiple agents about what coverage and cost may be the best for your situation. When considering quotes, be sure to factor in what is covered and and what is not, as the later may affect you more. Ask a lot of questions and be sure you understand the coverage and the price fully before you buy a life insurance policy from an online quote. There are many companies out there to get free quotes from, so be sure to get multiple life insurance quotes and buy the policy that is best for you. Start protecting your family by getting free quotes on affordable life insurance policies today.

The Universal Life Insurance Quotes

Universal life insurance quote is a projected cost for universal life coverage. When looking for some types of life insurance, the insurance agent will ask queries to find and provide consumers the exact quote. The quotation is the estimation of the sum of money to be paid by the insurance holder. There are various factors that resolve a life insurance quotation. These factors comprise the health of the owner, the location, and the total amount of insurance the holder desires.

Universal life insurance Quotes is a kind of long-term life assurance that invests a fraction of remunerated rates. With this, there is normally the least sum of interest that is assured to be reimbursed into the account of the holder monthly. The policy owner likewise has a particular freedom to choose where his finances will go. The disadvantage of this insurance plan is the adjustable interest rate. This may indicate big payoffs once the rates ‘re going up and loses after the rates are falling.

When the payments are given monthly, a few of the premium is accredited to the worth of the account owner. Interest is credited also to the actual account value. The remaining cash is left in the account worth of the policy holder, after the price of life insurance and all operating expenses are remunerated out. The owner is capable too in regulating the proportions of cash he/she would want to place in his/savings or insurance. This signifies that he/she may choose to either deposit much more in the savings account or purchase his/her insurance in order that the death advantages may increase.

A universal life insurance quotation, similar to all life insurances quotes, relies on several factors. Quotations may differ according to the height or weight of the owner, and also the location. Insurance have the inclination to become more costly while the covered grows older, hence age is really a factor too. The amount of insurance coverage the owner chooses will similarly affect the universal life insurance quote. This is factual also on the health of the proprietor.

Several questions are asked, when getting a quotation on universal life insurance. Any info asked by the agent or website form must be answered honestly if possible. Any wrong response might throw off the actual quote. One must note that a quotation is not the assurance of the sum a person has to pay when they opt to buy the insurance. The accurate amount that a insured individual will pay is determined after the review of the insurance company. Just go to this site http://InsuranceLifeQuotesUniversal-syai.blogspot.com/.Org for you to find out more details.

Get a CLUE about homeowners insurance

The Comprehensive Loss Underwriting Exchange (CLUE) report, generated by LexisNexis, includes auto and home insurance information gathered in a national database from insurance companies. According to LexisNexis, CLUE reports for home insurance contain a seven-year history of claims against a particular property, along with personal identification information of the homeowners. The insurance portion of the report includes the date of a loss, type of loss claimed and amount paid by the insurance company.
How property insurance companies use CLUE reports

"We use CLUE reports for homeowners insurance to help measure the risk associated with providing insurance as accurately as we can," says Dick Luedke, a spokesman for State Farm Insurance. "We look at the history of the homeowners and the history of the property to estimate risk."

Luedke says that CLUE reports are just one factor in determining homeowners insurance quotes, which are based on a variety of issues such as the location and size of the home, construction materials and local weather.

"At State Farm we are looking for the number of claims and the type of claims on a policy in order to assess risk," says Luedke. "For example, if there are consistent claims over several years for water damage, there could be a higher risk of more water damage. We are also looking to see if repairs have been made that will reduce risk in the future. For instance, if a homeowner called about hail damage, we want to know if they repaired the roof or siding. Otherwise, we might have to pay higher costs to repair the damage from two separate incidents."

Generally, insurers charge higher premiums to customers with numerous or expensive claims. Luedke says CLUE reports can help homeowners insurance providers accurately assess risk and therefore charge fair premiums.
CLUE reports can help home buyers and sellers

The Insurance Information Institute (III) recommends that home buyers request a loss history report in order to learn whether previous owners made insurance claims and, if so, what type of claims were made. For example, a series of water damage claims could indicate a plumbing problem that will require costly repairs. Buyers can opt to negotiate with the sellers about repair issues or reduce their offer if they find problems.

"Buyers cannot request a CLUE report directly from LexisNexis because anyone other than the owner or an insurance company must have a 'permissible purpose' for the request," says Hageli.

Buyers can make their offer contingent on receiving a copy of the CLUE report if desired. III points out that CLUE reports can reveal positive information about a home as well, such as the existence of a new roof or other repairs that add value to the home and may even reduce the cost of homeowners insurance.

A homeowner who is selling a property, should also request a CLUE report. Sellers, as well as their real estate agents, can request a CLUE "Home Seller's Disclosure Report", which provides a five-year insurance loss history on the property without including personal information about the property owners. Offering this report to a potential buyer can ease concerns about the condition of the residence.
Check up on your CLUE report

"Very few consumers know about this, but everyone should request a copy of their CLUE report in order to correct any errors," says Alex Hageli, director, personal lines for PCIAA (Property Casualty Insurers Association of America). "If a CLUE report results in an increase in your premiums, denial of coverage or in the cancellation or reduction of your insurance coverage, your insurance company must inform you of this and tell you how to get a copy of the report."

Homeowners should check their CLUE report for accuracy before requesting a homeowners insurance quote from a new insurance company in case there are errors. Under the Fair Credit Reporting Act, consumers are entitled to a free copy of their CLUE report each year. Hageli says that the process for disputing errors is similar to fixing mistakes on a credit report, with the necessary steps described on the report itself.