Term life insurance policies offer insurance protection for a specified term or period of time - typically, one, five, 10, 15, 20 or 30 years, or until a specific age (such as 65). Premiums may increase each year (annually renewable term) or remain level for a set period (level term), and the insurance is generally less expensive than permanent (cash value) life insurance.

At the end of the term period the policy may contain a provision permitting it to be renewed without a medical exam, although the premium rate probably will be higher. Some term life insurance policies include an option to convert to a permanent life insurance policy.

Term life insurance is typically purchased by individuals who need insurance coverage for a temporary period of time (e.g. mortgage coverage) - or who need a large amount of life insurance at the lowest possible cost.

Universal Life

Traditional term life insurance provides a death benefit only; the policies do not offer an opportunity to build cash values. A new product concept known as "return of premium term" returns at the end of the level-premium period the amount of the cumulative premiums paid, if the policy is inforce, and in some cases the contract builds cash value. This is an alternative to traditional term life and permanent insurance products.

Universal life policies offer the policy owner more flexibility than whole life insurance - the flexibility to choose both the amount of insurance and the premium to be paid with a range of potential premiums. As needs change, the amount of coverage and premium paid may be adjusted subject to certain limitations. Premium payments are credited to a cash value account where the money earns tax-deferred interest at a rate set by the company, which may be higher than the minimum rate guaranteed in the policy. Policy expenses and cost of insurance charges are deducted monthly from this cash value account. Generally, cash values can be accessed by the policy owner through policy loans and withdrawals (charges may apply).
Indexed universal life products offer interest-crediting rates linked to a stock market index, with the safety of a minimum guaranteed interest rate. Policy owners can benefit from the growth of the Standard & Poor's 500 Composite Stock Price Index,** not to exceed an index cap rate declared by the insurance company. When the index is down, policy owners earn at least a guaranteed minimum interest rate.

Universal life products may offer a no-lapse guarantee to ensure that coverage will continue from the policy issue date for a specified period of time, as long as the minimum guaranteed premiums are paid. These policies may be maintained with less than the guarantee premium and include a catch-up provision which allows the policy owner to catch up the guaranteed premium at any time if the policy is in force.

Whole Life

A whole life insurance policy provides a guaranteed death benefit and guaranteed cash values. The premium may be level or increase after a fixed period, but the premium will not change from the scheduled premium at issue. Part of each premium payment is applied to the policy's cash value account, which grows on a tax-deferred basis¹. In some cases, whole life policies may also be entitled to policy dividends, declared from the insurer's surplus, and an excess-interest whole life policy may earn an additional amount of interest after a specified period of time. Policy dividends and excess interest payments are NOT guaranteed.

Variable Universal Life

Variable universal life policies allow policy owners to invest their assets among a selection of professionally managed funds that make up the separate account. Unlike nonvariable policies, the insurance company does not guarantee the cash value of these investment options. Since the policy values may vary either upward or downward based on the investment performance of the investment options selected, a variable universal life policy presents an investment risk to the policy owner.
Prospectuses, Semi-Annual Reports, Annual Reports and Performance for Variable Universal Life Insurance Policies
Policy and fund prospectuses, fund annual and semi-annual reports and performance information are available for (i) our currently offered variable universal life insurance policies and (ii) many variable universal life insurance policies no longer offered for sale. Click the policies links below to view the documents that are available.

Copyright (C) 2006.P.BoucaumontEmail: lifeinsurance@wbrandon.net