What type of life insurance incorporates flexible premiums?
Asked by: Sammy Barrows | Last update: December 10, 2025Score: 4.1/5 (25 votes)
What type of life insurance incorporates flexible premiums and an adjustable death benefit Quizlet?
Universal Life is designed to provide flexible premiums and an adjustable death benefit. Which type of policy is considered to be overfunded, as stated by IRS guidelines? "Modified Endowment Contract". A policy that is overfunded to where it does not meet the 7-pay test is considered a Modified Endowment Contract.
Which type of life insurance allows for flexible premium payments?
Universal life is also the most flexible of all the various kinds of policies. Because it treats the elements of the policy separately, universal life allows you to change or skip premium payments or change the death benefit more easily than with any other policy.
What type of insurance is flexible premium adjustable life?
Adjustable life insurance is a policy that allows you to change features after signing up, including the premium payment and the death benefit. Also known as universal life, adjustable life policies include an interest-bearing savings component, the “cash value” account, which you can tap into while alive.
Does variable life insurance have flexible premiums?
Variable universal life policies have flexible premiums.
The premium flexibility for variable universal policies usually comes down to two things: flexibility in when you pay and how much you pay. Some VUL policies allow you to change the dates that your life insurance premium is due.
What Type Of Life Insurance Incorporates Flexible Premiums? - InsuranceGuide360.com
Are whole life premiums flexible?
With whole life, your premiums are fixed and guaranteed never to rise1. As long as you continue to pay them, you can count on the life insurance benefits being paid to your beneficiaries. With universal life there are no fixed premiums and you have more flexibility on when you make payments.
What is the difference between variable life insurance and variable universal life insurance?
Variable life insurance is a permanent life insurance policy with a fixed death benefit: the amount paid when you die. Variable universal life insurance, often called VUL, has a flexible death benefit and adjustable premium payments.
Which type of life insurance offers flexible premiums a flexible death?
Universal life is a form of permanent life insurance that gives policyholders flexibility in paying premiums, a cash savings component, and a death benefit.
Which life insurance policy is characterized by flexible premium payments?
Universal Life Insurance - This type of life insurance is characterized by flexible premiums, face amounts and death benefits. This product is similar to term life insurance except it has a cash accumulation feature.
What are the disadvantages of universal life insurance?
Some of the drawbacks include caps on returns and no guarantees as to the premium amounts or market returns. An IUL insurance policy may be canceled if you stop paying premiums. IUL policies are generally best for those with large up-front investments who want options for a tax-free retirement.
Which type of life insurance policy is an advantage of flexibility?
Flexibility: With universal life insurance, you have the flexibility to adjust the death benefit. Without purchasing a new policy, the benefit can be decreased to a lower amount or increased to provide more coverage. This flexibility allows the death benefit to be tailored over time as needs and circumstances change.
What are flexible premiums?
Flexible premiums refer to the policyholder's ability to adjust the amount and frequency of their premium payments within certain limits. This flexibility allows the policyholder to contribute more or less funds based on their financial situation at any given time, without jeopardising the status of the policy.
What type of life insurance is best?
A whole life policy is generally considered the most secure form of insurance. Whole life policies have more rigid premium payment requirements than universal life policies. As long as scheduled premium payments are paid, the cash value is guaranteed to increase each year.
Which type of policy allows for flexible premiums and an adjustable death benefit while allowing the policy owner to choose the investments of the cash values?
Universal life is a flexible way to get a permanent life insurance policy and build cash value. The premiums are flexible: you can raise or lower payments within certain limits set by the insurance company.
Which of the following life insurance policies provides more flexibility?
Universal life insurance
It's sometimes called adjustable life insurance because it offers more flexibility than a whole life policy. For example, universal life policies allow you to increase or decrease your death benefit and even adjust or skip your monthly premium (within certain limits).
Which of the following policies is characterized by flexible premium and death benefit in allows the policy owner control of the investment aspect of the plan?
Universal Life
These policies provide death benefit protection and are designed with flexibility in mind. The policy owner can change the amount and frequency of premium payments and death benefit can be adjusted down or up (with evidence of insurability).
What insurance has flexible premium payments?
Adjustable life insurance is another name for universal life insurance, a type of permanent life insurance that grants you more control over your policy details. For example, you can adjust the schedule and amount of your premium payments, and increase or decrease your coverage amount.
Which type of policy allows for a flexible premium and a variable investment component?
Variable universal life (VUL) combines lifelong insurance protection with flexible premiums and cash value you can access while alive. VUL insurance lets you invest and grow the cash value through subaccounts that operate like mutual funds.
What is the flexibility of premium payments?
This means that individuals can increase or decrease the amount they pay each month, depending on their financial situation. This feature allows policy-holders to have control over their policy and make changes as needed.
Which type of insurance offers the most flexibility?
The type of insurance plan that offers the most flexibility is the Preferred Provider Organization (PPO), as it allows the policyholder to choose any healthcare provider, although staying within the plan's network can offer cost advantages.
Which type of policy combines the flexibility?
The type of policy that combines the flexibility of a universal life policy with investment choices is the variable universal life policy. This policy allows for adjustments in premiums and death benefits while offering a variety of investment options for the cash value.
What is a life insurance policy which is characterized by flexible premium payments called?
Explanation: Universal life insurance is characterized by a flexible premium and death benefit, allowing the policy owner to have control over the investment aspect.
Which type of life insurance offers flexible premiums, a flexible death benefit, and the choice if how the cash value will be invested?
Final answer:
The type of life insurance that offers flexible premiums, a flexible death benefit, and investment choices for cash value is the variable universal policy. This policy allows for significant customization compared to other life insurance options. Thus, the correct answer is A. Variable universal policy.
Is variable life insurance flexible?
Variable life insurance is permanent coverage with flexible premiums and many investment choices. You can customize a policy to fit your financial needs. If you want a wider range of investment options, variable life insurance might be the right choice.
How to differentiate between whole life and variable life insurance?
Term life is more affordable but lasts only for a set period of time. On the other hand, whole life insurance tends to have higher premiums but never expires. Knowing the differences between term and whole life insurance will help you choose a policy that works best for you and your lifestyle.