Unlike term and whole life insurances, this policy blends term insurance and an investment account into one contract. Also its premiums can be increased or decreased, paid when due or at unscheduled dates, or stopped entirely and restarted at the owner's will provided the policy value is adequate to maintain the cost of the insurance.
This type of policy is adapted well to satisfy the changing insurance and investment needs of its owner.
(By Kyle J. Norton)
Recommended Reading
Live Your Life Insurance
Teaches You Surprising and Viable Strategies
For Developing Prosperity Through
Your Life Insurance Policy
Analysis of Universal Life Insurance Sales - Variable Life is Now a Gamble - Crisis For Clients
Individual life insurance sales of variable life and universal life is a gamble for clients. Current analysis also reflects a reluctance of agents making large variable or universal life sales. Which crisis is worse? Should agents quit pushing variable life insurance, or are clients just being overly skeptic? Here is the information you need to decide.
In the first three months of 2009 life insurance sales premiums did not become paralyzed. Instead, sales plunged to where premiums are down over 25%. This is a level not seen since the early 1940's.
Term insurance, which typically has no cash value, has little change noted. This means there is a reason for the market based cash value policies of universal life and individual variable life sales experienced a drastic beating. These policies are very risky during a period of an economic downturn. The first quarter of 2009 is a wake up call. Variable Universal Life sales premiums equaled only 40% of the amount collected during the last quarter of 2008. Variable Life, not as risky as variable universal life, countered with a decline of about one-half as much.
Insurance representatives were stunned by client reactions, and in many cases did not present variable products to their potential clients. Many clients having been burned stuck to purchasing the less fluctuating vehicles of term life insurance and whole life.
As a result, the so-called "financial experts" were burned on sales and commission earnings. The positive analysis of this is the fate of insurance agents not truly qualified to sell financial asset related sales. Thousands of these agent trainees left the business or started selling basic products like those that they should have done at the beginning.
The final analysis is that people will continue to buy life insurance for protection purposes. However, consumers will stay more cautious when viewing insurance as a super investment vehicle. In turn, sales agents making variable universal life, variable life, and equity indexed annuity sales will be more careful in explaining the risks that go along with the sale.
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Recommended Reading
Live Your Life Insurance
Teaches You Surprising and Viable Strategies
For Developing Prosperity Through
Your Life Insurance Policy
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