What is Universal Life Insurance and do I Need It in Cincinnati?

Life Insurance Cincinnati

Cincinnati is home to the Cincinnati Reds with beautiful bridges and scenic hills. Living in Cincinnati is living in the heartland and why should you think about life insurance? The reason is that even living in a beautiful setting cannot stop bad things in life from knocking at your door. Illness and tragedy can strike at any time and the best preparation is a sound life insurance policy.

Many people raise their eyebrows when the words, “life insurance” are spoken. Very few people are eager and ready to discuss life insurance. Although it is horrible to consider that an unforeseen calamity could remove income from your life, it is far worse to live that experience. The world is full of illness, traffic accidents and heart attacks. None of us are immune and as the old saying goes, “nobody makes it out of life, alive.”

There are three primary types of life insurance, term life, whole life and variable life. Each type has its plus and minuses. Term life Cincinnati is a very simple type of life insurance. You pay a fixed price for a fixed amount of time for a fixed payout. When your time (term) is up, your policy may be renewed. It is typically renewed at a much more expensive rate. Whole life insurance has a fixed price, lasts a lifetime, cannot be revoked and guarantees an additional cash value (much like a savings account).

The third type of life insurance is called variable life. Variable life insurance is a combination of permanent life insurance with a savings account. You may invest these savings in stocks, bonds, money market accounts or mutual funds. One portion of your payment (premium) goes to pay for life insurance. Another portion of your payment goes into this savings account.

Just as with the stock market, these investments carry risk. The cash value and death benefit may accumulate more quickly than a whole life policy. However, if your selections of stocks, bonds, money market accounts or mutual funds do not perform well your death benefit may decrease (although never below a guaranteed minimum).

You may not withdraw from the cash value of this life insurance policy during your lifetime. The policy and earnings are not taxed until the policy is surrendered and you may apply your earnings toward your policy payments.

Variable life insurance requires knowledge of portfolio investments and is not for the novice investor searching for a simple type of life insurance. For those with greater experience, variable life insurance provides additional options and benefits over other types of policies.