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Have you ever heard of Universal Whole Life Insurance where your policy is up to 120 years of age?

If so, what really is the difference between regular whole life and Universal whole life? A family member has purchased and so called Universal whole life policy and I just want to make sure there is no scam or something involved?

Public Comments

1. In an of itself UWL is OK. It is just modification of the old Whole Life policies. As far as the 120 years of age thing goes that's just marketing. Don't worry about it unless the person buying it is 119.
2. I think it works like this lets say the price per month is $100 then $15 goes to an investment fund like a mutual fund and you pay $85 for that months worth of coverage. Every month the amount that goes to the fund increases and the amount or cost of the policy decreases. Upon the policy holders death the family gets the base amount of the policy unless the amount in the fund exceeds it in that case they get the fund amount. It's like a way to get more than you pay for with Whole life it's not bad. You can make the argument for term life but you cant always get it when your old or if your health deteriorates this way your locked in with whole life. Although I think Universal life was coming under fire for there fees you can prob find some cheaper but then again your family member prob wasn't shopping for the best price when she bought it. Its like when you find a new car on the lot and buy it with emotion your going to pay a little more but it was right there and you were thinking of the joy it would give you and your family not how you can save a buck.
3. Let suze Orman give you the answer. http://www.youtube.com/watch?v=sGDgYLCpnDo
4. It is a RIPOFF. Tell your family member to buy a term life insurance policy with level premiums for 30 years. And, put some money into a 401K or other savings.
5. If your family member has a need for permanent life insurance, then this is a good path to at least explore. (Notice I didn't make a judgement about what you or your family member should do). Most whole life policies terminate at the insured's age 100. With so many people living beyond age 100, having coverage beyond that might come in handy. Many universal life policies offer this flexibility - like age 120 or even longer. And with on-time premium payments, some universal life policies can be structured to have guaranteed payouts, just like a properly funded whole life policy. So yeah, it's a real thing, but I can't comment on that specific policy because I haven't seen it. If you have any specific questions, you might want to talk with the agent who sold it.