Universal Life Essay

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As the insurance industry is becoming highly competitive, we should develop and promote a new innovative insurance product – Universal life (UL). Universal life insurance is a permanent life insurance plan with the benefits of tax-advantaged investing. UL allows policy owners the flexibility to customize the coverage and premiums based on their financial planning needs. I believe UL has a great potential in attracting individuals who:
 need life insurance
 want to actively manage their life insurance policy
 are concerned about wealth accumulation
 seek a tax-efficient way to protect their assets
Unlike term insurance which provides temporary protection, UL aims to protect policy owners for life with a tax-deferred investment component. With universal life insurance, regular monthly deposits are made into the investment accounts chosen by the policy owner. As of an accounting date each month, the insurance company takes out a portion of the deposit to cover the insurance premium and administrative costs. The money left is credited with monthly interest based on the performance of the selected investment accounts. Under the contract, the policy owner can decide whether to pay only the insurance and administrative costs or use the investment component. …show more content…

The death benefit of a UL policy can keep a business financially strong from the unexpected death of an owner, partner or key employee. Upon the death or disability of the policy owner, UL can create immediate capital for partner or shareholders to fund a buy-sell agreement. To policy owners who want to preserve the maximum value of their estate for their beneficiaries, UL ensures that the estate is passed on intact by providing beneficiaries tax-free insurance proceeds to pay potential tax liability. As an effective tool in estate preservation, UL can help enhance and protect assets of policy

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