Your payments (premiums)
You can think of universal life insurance as a middle ground between the simplicity of term life and the permanent benefits of whole life insurance. Universal life provides long-term protection that potentially builds cash value and can be customized to you.
Having a universal life policy is all about having flexibility to choose the benefits you want now with the ability to adjust your policy later as your needs evolve.
You can always change premium amounts, the total amount of insurance you have, and the length of time you’re covered1
Provides ongoing financial protection for your loved ones for as long as you need
If your policy is designed to accumulate cash value it may increase over time, providing a source of money you can use during your lifetime
New York Life Insurance Company, parent company of New York Life Insurance and Annuity Corporation, which issues universal life policies, has been paying benefits consistently for 175+ years
Budget-friendly, long-term protection that you can adjust now or later, based on your needs, plus some accumulation of cash value
Preset premiums that maintain coverage for as long as you need, creating a guaranteed death benefit but little to no cash value
You can choose how the death benefit is paid to your loved ones and in which amounts (depending on cash value and premiums paid)
A type of death benefit that fluctuates in value depending on the face value of your policy plus the total amount of premiums you paid into it2
If you become chronically ill, the death benefit can be paid during your lifetime, tax free, to help cover costs associated with chronic health needs3
If your situation changes, you can recoup all or part of your premiums on certain future policy anniversaries (only for Custom Guarantee policies, most of which automatically include this option)4
Universal life insurance is a policy that can cover you for an extended period of time—often longer than a temporary term life policy, but customizable to your needs. It can give you access to cash value to help you protect the future of your family or business. But the most unique feature of universal life is the flexibility to set your own payment schedule and level of coverage. You can also make certain adjustments in the future, as needed.
Universal life can provide long-term coverage as long as there is enough cash value in the policy to cover your policy’s monthly deductions. If you decide to end (surrender) your policy, you would receive the surrender value (the cash value minus any charges associated with canceling).
Universal life is highly customizable, so you can adjust coverage in many ways to fit your budget. Your own costs may depend on the policy you choose, the benefits you prefer, the amount of coverage you need, how you choose to fund the policy, and the length of time you’re covered. Your agent will help you find the right solution for your budget and goals, and can help you make adjustments in the future if you need.
Universal life offers many benefits that you can customize to your needs and goals. It provides a long-term death benefit for your loved ones, helping to support them financially if you pass away while the policy is active. Universal life also builds cash value over time, which can help fund key expenses in your lifetime such as a down payment on a home or college tuition. You can access funds by taking out a loan from your policy or by taking out cash through what’s called a partial surrender.6
When you purchase a universal life policy, you choose how much to contribute with each payment (premium), how much coverage you have, and for how long. You’ll have the flexibility to change these features if your needs evolve. Additionally, as the policy grows in value over time, you’ll have several options: take out some of the cash value (a partial surrender) to support you in the short term; borrow cash from the policy and repay it to maintain the death benefit; and/or leave all cash in the policy to maximize the potential death benefit that would be paid to your loved ones if you pass away.
Can be adjusted |
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Guaranteed minimum interest credited |
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Can be adjusted |
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Cash value growth subject to market risk |
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Remains level for a period of time you select, then increases over time |
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Always the same amount |
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1The policy will terminate if at any time the cash surrender value is insufficient to pay the monthly deductions. This can happen due to insufficient premium payments, if loans or partial surrenders are taken, or if current interest rates or charges fluctuate.
2The cost of the Return of Premium rider is added to the cost of insurance charge.
3The Chronic Care rider is available at an additional cost.
Before a claim is approved, New York Life reserves the right to have the Insured examined by a Licensed Health Care Practitioner the company designates, at the company’s expense. Verification may include a review of the medical facts to substantiate the certification, copies of the daily notes of care (including notes made by any Licensed Health Care Practitioner) and/or copies of itemized bills for the Insured’s care and services. New York Life will only use these to determine eligibility at the start of a claim or at recertification. They will not be used to determine the benefit amount. Once the insured is certified as chronically ill as described in the policy, and meets the 90 day elimination period, the policy owner will begin receiving an unrestricted cash benefit, with no receipts or plan of care needed. This is a life insurance rider providing for an accelerated payment of the base policy face amount in the event that the insured is certified as chronically ill as described in the policy. The primary purpose of life insurance policies is death benefit protection, with certain riders available at a cost that provide the client with additional policy features, such as additional protection for future chronic illness expenses.
This rider is not intended to be a federally tax-qualified long-term care insurance contract under Internal Revenue Code (IRC) Section 7702B. Since this rider is not a Qualified Additional Benefit and an implicit rider premium is included in premiums paid, each rider charge deducted would reduce the basis. In addition, for any acceleration of face amount, the entire face amount would reduce basis (not the proportionate amount of basis associated with that portion of face amount). This rider, however, is subject to the federal per diem limits set forth in IRC Section 7702B. Under this rider, New York Life will not pay clients more than the federal per diem limits. If the benefit option elected exceeds the current IRC per diem limits, the benefit period will be extended accordingly. Assuming the amount you receive in the aggregate from all applicable policies does not exceed the federal per diem limits set forth in IRC Section 7702B, the benefits provided by the Chronic Care Rider are intended to be excludable from federal gross income under Section 101 (g) of the IRC.
Receipt of an accelerated death benefit may affect client eligibility for Medicaid or other government benefits or entitlements and may have income tax consequences. Accelerating benefits before applying for these programs, or while you are receiving government benefits, may affect your initial or continued eligibility. Clients can contact the appropriate social service agency (e.g., the Medicaid Unit of your local Department of Public Welfare or the Social Security Administration Office) for more information.
The Chronic Care Rider is currently unavailable in California.
4In order to keep the Money Back Option Rider active, the policyholder must maintain an annual premium that would keep the policy inforce to age 100 (divided by 12).
In New York it is called the Premium Back Option Rider. The opportunity to surrender the policy in exchange for some or possibly all premiums is available during two 60-day windows beginning in policy year 20 or 25. The surrender is subject to a 40% premium cap, and there is a minimum premium requirement (the monthly premium must be that needed to keep the policy in force until age 100).
5Dividends are not guaranteed. Not all participating policy owners are eligible for dividends.
6A partial surrender will reduce the potential amount of the policy’s death benefit.
The New York Life Universal Life policy form number is ICC19- 319-51P.
In Oregon, the policy form number for Custom Universal Life Guarantee is ICC18-318-54P