Did you know that in Miami universal life insurance can offer serious benefits to you as the insurance holder, right now, in your own lifetime? Not a lot of people do, but for those in the know, having a universal life insurance policy can be of significant assistance in all kinds of financial dealings, including loans, withdrawals, and pension funding.
How It Works
Let’s take a look at some of the ways you can benefit from having a universal life insurance policy in Miami.
• Loans: Universal life insurance policies typically have an option allowing policy holders to undertake a loan based on policy cash values. Since any loans which are outstanding will be repaid at the time of the policy holder’s death before the beneficiaries are awarded, you are not required to make payments on the loan principle. Of course, if you don’t want the loan amount deducted before your life insurance is paid out, you will need to pay the loan in full. You are responsible for making regular interest payments to your insurance company, to compensate for the loss of investment returns on the money removed as a loan. Defaulting on interest payments won’t affect your credit score, but it will cause your universal life insurance policy to lapse.
• Withdrawals: An alternative to taking out a loan, tax-free cash withdrawals can be arranged on a one time basis, or as a regular income supplement, so long as the total amount withdrawn does not exceed the premium payments which have already been made into the insurance policy. Policy holders wishing to go this route should be aware that the withdrawals will permanently lower the insurance pay out upon holder death, and must conform to IRS Regulations.
• Pension Funding: Working with the concept of income supplementary withdrawals, policy holders who desire larger pension earnings than are possible within their current pension plan can overpay into their universal life insurance policy during their working years, with the plan to use this as an income supplement later in life.
Contact an agent at American Insurance Brokers to find out more about how a universal life insurance policy can benefit you and your loved ones, now and later.
