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Houston TX Variable Universal Life Insurance

Are you wondering if Houston TX variable universal life insurance plans will fit your family’s situation? Or are you wondering what the difference between universal, variable, and universal life insurance is? The experts at Best Life Insurance Houston Agency can alleviate any concerns you may have.

First off, all three are types of permanent life insurance. Unlike term life insurance, these insurance plans will last a lifetime. As long as you pay your premium, you’ll be protected for a long time.

Each comes with its quirks that may or may not make them suitable for your situation and wants. Knowing about them ahead of time will make narrowing down your options easier.

Houston TX Variable Universal Life Insurance

Alongside whole life insurance, universal life insurance is one of the most common permanent life insurance plans. While you can’t change the death benefit and premium amounts once set with whole life plans, universal life insurance can. Flexibility is the universal life plans’ most vital feature.

Houston TX Variable Universal Life Insurance

Consider different types of life insurance to find the right one for you and your family.

As with whole life insurance plans, universal life insurance plans have a cash value. Your premiums go toward both the death benefit and cash value. As long as there’s enough cash value in your account to cover the costs of the policy, you can adjust the death benefit and premium amounts.

But there’s a catch. The cash value in universal life insurance policies has an interest rate that may change according to the current market. If the interest rate decreases to the market’s minimum rate, your premium would have to increase to offset the reduced cash value.

Variable Life Insurance

Although variable life insurance is also a permanent life insurance plan, what you can do with the accumulated cash value differs. You can invest the cash value into mutual fund-like sub-accounts.

What does that mean? Potentially, your cash value could grow limitlessly. On the other hand, it could also mean your cash value can decrease in value as well.

How does it work? The cash value associated with variable life insurance plans is akin to investing. That’s where the potential for higher, tax-deferred growth comes from.

But there is a catch. You can only invest in sub-accounts available to your policy. That means the wide variety of mutual funds on the open market won’t be available to you.

Of course, that makes this type of insurance plan riskier than usual. Like investing in stocks, several variables could change and affect your accumulated cash value.

Depending on the policy, losing too much may negatively affect your death benefit amounts and premium. Although, some policies make sure your death benefit won’t go below a minimum level.

Variable Universal Life Insurance

Now, what is variable universal life insurance? If you thought the name meant it was a combination of the before-mentioned types of insurance, you would be correct.

Houston TX Variable Universal Life Insurance

Ask Best Life Insurance Houston Agency about Houston TX Variable Universal Life Insurance plans.

Houston TX variable universal life insurance takes attributes from both universal and variable life insurance plans. Variable universal life (VUL) plans are a type of permanent life insurance policy with a built-in savings account that you can invest with.

This type of plan takes the flexibility that other permanent life insurance plans don’t necessarily have from universal life plans. In other words, you can still adjust the death benefit and premium amounts to suit your current needs later down the line. The catch is, of course, that you have enough accumulated cash value in your account to support your decision.

Variable universal life insurance plans take the investment portion from variable plans. Like variable life plans, you can invest your cash value and watch it grow. However, variable universal life plans usually have a maximum and minimum cap on the investment returns with the savings components.

Like with variable plans, you can only invest in sub-accounts associated with your policy. You won’t be able to invest your cash value on the open market because of that. These sub-accounts function similarly to mutual funds and are susceptible to market fluctuations, which means you’ll either get significant returns or substantial losses. 

Is Houston TX variable universal life insurance worth it?

Do you enjoy the fact that universal plans give you the flexibility to adjust accordingly in the long term? Or do you prefer that variable plans not only have the potential to grow your cash value while still having protection for a lifetime? Between the three options of universal, variable, and variable universal life plans, variable universal life plans give the best mixture if you’re interested in the other two.

Not only is it a permanent life insurance plan, which extends its protection to your lifetime, you can also invest any cash value it accumulates. And if something happens in the future, you’ll also have the flexibility to adjust the death benefit amounts and premium payments.

Of course, since it’s a combination of two other insurance plans, you’ll also have to deal with the drawbacks of the two. Since you can invest your cash value, it could fluctuate in either a positive or negative way. It would depend on the market.

Riding on that, you’re usually only able to adjust how much you pay or how much your beneficiaries receive if you have enough cash value to support it. At that point, if your investments are failing you, you might not be able to adjust the premium and death benefits amounts at your leisure.

Houston TX Variable Universal Life Insurance

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Coming to a Decision?

Variable universal life insurance is a life insurance plan that offers increased flexibility and growth potential by drawing on a medium between two other types. However, you should assess all the risks you’re willing to take before you make a decision. If you would rather take fewer risks, other potential investment options may better suit you and your family. Give us a call and our team can schedule an appointment for a face-to-face at our Houston location!

Before you make a decision, you should know your other options. If you have any more questions regarding variable universal life insurance plans, perhaps you should sit down with an insurance agent. The experts with Best Life Insurance Houston Agency can answer Houston TX variable universal life insurance questions.

Houston, TX Fun Facts:

  • The Texas Medical Center in Houston is the largest medical institution in the world.
  • Houston is home to Baylor College of Medicine.
  • St. Joseph Medical Center is Houston’s first hospital.
  • Memorial Hermann is Houston’s largest non-profit emergency center network.
  • Check out the official website for more information.

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