"Your Personal Insurance Broker"

Gerczak Insurance Agency, Inc. | 901 A Regester Parkway Richmond VA 23226 US | +1.8774372925

permanent life

"Buying" Life Insurance

 

​Permanent Life Insurance is an umbrella term for life insurance plans that do not expire and combine a death benefit with a savings portion. The two main types of permanent life insurance are whole and universal life insurance policies, but there are even different types and options within those two types. 


*Much like buying a home, it's yours as long as the mortgage [premium] is paid and builds equity [cash value] along the way.  Also, there are many types of mortgage options to pay for the home [policy] - cash down, equity from another property, varying rates, and payment options [whole, GUL, VUL, IUL, etc].


Whole Life

A life insurance contract with level premiums that has both an insurance and an investment component. The insurance component pays a stated amount upon death of the insured. The investment component accumulates a cash value that the policyholder can withdraw or borrow against.


Universal Life

A type of flexible permanent life insurance offering the low-cost protection of term life insurance as well as a savings element (like whole life insurance) which is invested to provide a cash value buildup. The death benefit, savings element and premiums can be reviewed and altered as a policyholder's circumstances change. In addition, unlike whole life insurance, universal life insurance allows the policyholder to use the interest from his or her accumulated savings to help pay premiums. 

  • Guaranteed Universal Life (GUL) - provides a death benefit as well as the opportunity to build cash value. This coverage is different from term and whole life insurance because you have the options to vary the amount and timing of your premiums. Typically, you can also increase or decrease your death benefit. As long as you maintain sufficient policy value to keep your policy in-force, your policy’s flexibility enables you to pay premiums as your circumstances allow.
  • Variable  Universal Life (VUL) - provides a death benefit and an investment feature. The premium amount for VUL is flexible and may be changed by the policy owner. The investment feature usually includes "sub-accounts," which function very similarly to mutual funds which offer the possibility of an increased rate of return over a GUL.
  • Indexed Universal Life (IUL) - provides a death benefit as well as the opportunity to build cash value and includes the premium flexibility and adjustable death benefit that typical UL coverage provides. Plus, IUL can provide the potential for greater policy cash value growth than GUL by linking to one or more financial market indices such as the S&P 500®, Nasdaq-100®, or Dow Jones Industrial Average.