Universal vs Term Life Insurance: A Comprehensive Review

So, when you’re looking at life insurance, the major selection you gotta make is picking between universal and Temporary life insurance. Both types have unique advantages and disadvantages, and being aware of the distinctions can really make a big difference to your money plans.

Let’s start with cost-effectiveness.

Next up is liquidity and flexibility.

Then there’s the long-term stuff.

Now, let’s talk about policy riders.

Let’s start with cost-effectiveness.

One of the primary concerns for most individuals when considering life insurance is cost. Temporary life insurance usually costs less, especially when you have a young family.

That’s because term insurance is for a set amount of time, like 10, 20, or 30 years, but universal insurance lasts your lifelong. I chose term life insurance for my family while the children were young because it was just right for our money and made us feel more secure, knowing we’d be taken care of if something happened.

Next up is liquidity and flexibility.

Variable life insurance has more flexibility and easy access to your cash than Limited-term insurance. With universal, you can build up some savings amount that you can access or obtain a loan from if you need to.

This is especially handy if you might need to adjust your financial situation or if you want to provide for your loved ones. My friend John got Variable life insurance after his his first child was born because he wanted the ability to modify the insurance plan and invest the funds into his child’s future education.

Then there’s the long-term stuff.

If you’re looking for coverage that endures throughout one’s life, Variable life insurance could be the way to go. Limited-term insurance is good for a set period, but permanent life insurance is created to provide coverage throughout your lifespan.

It’s a positive thing if you wish to ensure your family is provided for if you die, regardless of your age. A survey conducted by life insurance professionals says the majority of individuals choose universal life insurance since it is more advantageous in the long term.

Now, let’s talk about policy riders.

You can add additional benefits to a universal life insurance policy, such as additional protection in case of accidental death, financial support if you are unable to work, or coverage if you become seriously ill. These additional benefits provide you with extra protection and give you greater peace of mind, tailoring to your specific requirements. I chose to include an accidental death benefit to my term life insurance policy since I wished to ensure my family was protected in the event of an unfortunate incident involving me.