Policy
Type: |
Permanent |
Term
to 100 |
Term |
| Whole
Life |
Universal
Life |
| Period
of Coverage: |
Life |
Life |
Life,
policy usually paid up at age 100 |
Depends
on term in contract. Usually 5 or 10 years but often renewable
for additional terms to age 70, 75 or 80. |
| Premiums: |
Guaranteed.
Usually remain level. |
Flexible.
Can be increased or decreased by policy holder within limits. |
Guaranteed
in the contract. Remain level. |
Guaranteed
in the contract. |
|
Death
Benefits:
|
Guaranteed
in the contract. Dividends, if payable and applied under certain
options, may increase the death benefit. |
Face
amount is defined and guaranteed in the contract. Fund values
may be paid in addition depending on options selected. |
Guaranteed
in the contract. Remain level. |
Guaranteed
in the contract. |
| Cash
Values: |
Guaranteed
in the contract. They are part of the guaranteed death benefit
and are not paid out in addition to it. |
Flexible.
Increase or decrease according to the investment returns and
level of policy holder deposits. |
Usually
none. |
Usually
none. |
| Buyer
Appeal: |
Most
elements of coverage are guaranteed. Requires little involvement
on part of the insured. |
Unbundled
approach makes policy easier to understand. Side fund investments
if properly managed can produce significant additional value.
|
Provides
lifetime protection for the least outlay of cash but premiums
must be paid to continue coverage. |
Requires
the least initial cash outlay. Well suited to covering temporary
needs. |
