When you get indexed universal life insurance, you’ll first choose a policy according to the death benefit amount. Then you’ll be assessed to determine your insurability. This involves a medical underwriting process in which you’ll have a medical exam. Your insurer will also ask questions about your hobbies and occupation. This is how your insurer will determine how much you’ll pay in premiums.
This is a policy that lasts a lifetime, unlike a term life insurance policy that will only be effective for a number of years before expiring.
Throughout your time holding the policy, the insurance company will help with placing funds into a savings account. This function is known as a cash value component. These are small amounts, but they add up over time. You’ll be able to access these funds to meet your personal needs.
The amounts are built according to a stock market index. Indexes are fixed portfolios consisting of multiple stocks. While some risk is involved, it’s not nearly the same amount of risk you’d be taking if you were to invest in stocks directly. You can choose from a variety of indexes. Because the market can make shifts in either direction, this policy is best suited for those with a tolerance for risk.
However, other types of life insurance policies don’t give you the same benefit of a thriving market.
Indexed universal life insurance is beneficial for everyone involved. For you, you have something that can operate as a retirement fund that you can borrow from during times of need. In fact, at a certain point, you will have enough where the premiums will practically pay themselves. As for your loved ones, they will be able to enjoy a sizable death benefit when you pass away.
Alvarado Master Agency is here to help you get a policy that benefits both you and your loved ones. Reach out to us today to find out more about how we can help you get the life insurance coverage you need.