Is Life Insurance Like a “Swiss Army Knife?”

Outside of the army use, a Swiss army knife is thought of today as a device capable of many uses and applicable to solve many problems.

Unfortunately, life insurance is not a “Swiss army knife.”

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Life insurance companies design products for specific problems and specific niches. For example, some companies specialize in term for super healthy, others for healthy and standard, and some companies specialize in sub-standard health issues. Some companies specialize in women under age 50 and some over age 50. Some companies want your Whole business, some your Universal Variable Life business. No one company can solve all your problems.

To help you pick the right policy, here is a break-down of  the differences and similarities that various life insurance plans offer:

Guaranteed Universal Life (Most conservative)

• Death benefit is guaranteed if all premium payments paid on time.
• Guaranteed premium is required to keep policy in place.
• Designed to be a permanent policy but may not be if premiums are not paid on time.
• Not impacted by interest rates, dividend rates and stock market rates.

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Universal Life ( Most traditional)

• Death benefit is not guaranteed.
• No guaranteed premium is required.
• Designed to be a permanent policy but may not be if policy runs out of cash value.
• Impacted by interest rates and company performance.

Indexed Universal Life (Most complex to understand)

• Death benefit is not guaranteed.
• No guaranteed premium is required.
• Designed to be a permanent policy but may not be if policy runs out of cash value.
• Impacted by how crediting formula performs and subject to changes in caps.
• A volatile stock market can have a positive or negative impact on performance.

Variable Universal Life (most aggressive & potentially dangerous)

• Death benefit is not guaranteed.
• No guaranteed premium required.
• Designed to be a permanent policy buy may not be if policy runs out of cash value.
• Impacted by how your investment portfolio performs over time.
• Back-end loaded expenses make this policy more expensive to maintain the longer you live.

Howard Wolkowitz is a financial author, educator and fiercely independent life insurance broker.

You can visit LifeInsureAssure.com and go to his quote engine to see for yourself in seconds how inexpensive term life to age 85 is. If you want to speak with Howard, call 954-558-3673 or email him at [email protected]. 
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Stop overpaying for your current life insurance. ​

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