The universal life insurance policy has been around for a very long time. Here is an overview of this tradition and conservative insurance product used by millions.
A universal life insurance policy is really a contrast between initial cost and ultimate value. Simply put, the initial cost can turn people away without considering the long term benefit. It is this same flaw that leads people to buy a clearly inferior product that will not last long and need to be replaced over and over again. They do this simply because the immediate cost is low and they have a hard time thinking past immediate cost. Advertising and media have combined to push this cult of instant gratification, but it has been at the cost of sound financial planning principles.
Universal Life Insurance premiums for a certain level of protection based death benefit are going to be higher than can be found for a similar level of straight term insurance. Many clients are going to be looking at the amount of the first monthly premium and not caring much beyond that. Is it possible to explain Universal Life Insurance to a person with no concern for the future?
It may be true that there are some people that will not be willing to do the right thing from a “long term financial security” point of view as opposed to the “having a couple of extra dollars in your pocket today” point of view. However, most people really want to do the right thing for themselves and their families. The truly helplessly selfish are not going to even be considering life insurance in the first place. It is not something they will see as benefiting themselves.
The fact that Universal Life Insurance is an investment as well as protection is a very strong selling point to anyone who is serious about planning and controlling his financial future. The reasons for purchasing Universal Life Insurance are similar to such a person as the reasons for buying quality furniture or even a well made television set. Ultimately, these things will last longer and not need to be replaced as often. This will yield an ultimately better value. In Universal Life Policies, it is not uncommon for the point to be reached that earnings eliminate the need to pay premiums at all. They become optional as additional investments, but are no longer needed to maintain the policy and keep the “death benefit” in force.
When you explain Universal Life Insurance, you are explaining the difference between short term and long range thinking. You are explaining the difference between seat of the pants living and sound financial planning. You are explaining the difference between protection for your family that can only benefit you or them if you die too soon and protection that can benefit you more if you live than if you die.
Aazdak Alisimo writes about
universal life insurance for UniversalLifeInsuranceCompanies.com.
