A financial cushion to help those who depend on you, with flexible coverage and premiums.
Universal life insurance, like all life insurance, helps secure your loved ones’ financial future if you’re no longer there to provide for them. As your needs and priorities evolve, this policy allows you to adjust coverage and premiums within set limits.
What is Universal Life Insurance?
Universal life insurance is a type of permanent coverage designed to last your lifetime², providing financial support for your beneficiaries after you pass away. Unlike whole life insurance, it offers greater flexibility, allowing you to adjust your premiums, payment schedule, and death benefit while the policy remains active.
Key Features of a Universal Life Insurance Policy
Flexible Premiums – Adjust your premium payments within policy limits.
Cash Value Growth – Accumulates cash value with interest, typically tax-deferred.
Access to Funds – Withdraw or borrow against the cash value during your lifetime, usually tax-free.
Lifetime Coverage – Remains in effect as long as sufficient premiums are paid.
Tax-Free Death Benefit – Pays your beneficiaries a lump sum, generally tax-free.
Customizable Payout – Choose a fixed death benefit or one that grows with the policy’s cash value.
How Does Universal Life Insurance Work?
With each premium payment, a portion goes toward your policy’s cash value. Every month, the cost of maintaining the policy is deducted from this cash value. The amount and duration of your premium payments influence how much cash value accumulates over time. If your policy builds sufficient cash value, you may have the option to increase the death benefit, reduce premiums, or even pause payments while keeping the policy active.
Who Is Universal Life Insurance Best For?
Universal life insurance is ideal for those seeking lifelong coverage with the flexibility to adjust premiums and coverage amounts. It’s also a good option for individuals with long-term savings goals who want both life insurance protection and a way to build cash value over time.
Universal Life Insurance Options Offered by A.Neto Agency
Universal life insurance includes different policy types, allowing you to choose how your cash value earns interest.
A.Neto EssentialLife Universal Life offers a fixed interest rate, with a guaranteed minimum. While the company may apply a higher rate based on market conditions, the rate will never drop below the guaranteed minimum.
A.Neto Index Universal Life lets you allocate part of your premium to accounts linked to the S&P 500® or S&P MARC 5 ER® indexes⁷. This option provides growth potential tied to market performance while ensuring a zero percent floor, protecting against losses in poor-performing years.
This indexed approach offers greater growth potential with downside protection but may be more variable than A.Neto EssentialLife® Universal Life.
Key Differences Between Universal Life Insurance and Whole Life Insurance
Both universal and whole life insurance provide lifelong coverage as long as premiums are maintained. However, they differ in key aspects:
Universal life insurance offers more flexibility in premiums, coverage, and cash value growth, while whole life insurance provides guaranteed stability and predictable benefits.
Universal Life Insurance
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Whole life insurance
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Permanent – lifetime coverage
Permanent – lifetime coverage
Flexible – adjust payments monthly, pay the minimum or more. May reduce or stop payments if cash value is sufficient.
Fixed – premiums remain level throughout the policy’s life.
Flexible – can increase (with approval) or decrease. Can be a fixed amount or grow with cash value.
Fixed – remains stable based on selected coverage. Increasing coverage requires a new policy.
Earns interest at either a fixed rate or through market index options. Can be used to offset rising premiums or withdrawn during your lifetime.
Grows at a guaranteed rate with each premium payment. Can be accessed during your lifetime.
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Does Universal Life Insurance Have Flexible Premiums?
Yes. A key feature of universal life insurance is its flexible premiums. Each month, you can choose to pay the minimum or contribute more, up to IRS limits. If your policy has enough cash value, you may even skip or stop payments while keeping coverage active. Paying more than the minimum helps build cash value faster, while paying less keeps the policy in force as long as there’s enough cash value to cover costs. However, insufficient funding could impact long-term coverage.
Does Universal Life Insurance Have Flexible Death Benefits?
Yes. Universal life insurance allows you to adjust the death benefit within policy limits. You can increase coverage (subject to underwriting approval) or reduce it, as long as the policy meets minimum coverage requirements.
