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Single Premium Universal Life is paid for by a single, substantial, initial payment. As long as the Cost of Insurance charges depletes the account, the policy will remain in force.
Periodic premium payments need to be paid in Fixed Universal Life. These periods of payments will be for shorter time than the policy is in force and are subject to account value. In such a case you can
• Leave the policy alone, and let it potentially expire early (if COI charges deplete the account)
• Make additional or higher premium payments, to keep the death benefit level, or
• Lower the death benefit.
You are given the Flexibility to determine how much you wish to pay each time premium is due. Flexible Premium offers two different death benefit options:
• A level death benefit (often called Option A)
• A level amount at risk (often called Option B). This is also referred to as an increasing death benefit.
Flexible Premium is the most commonly purchased with a large initial deposit, followed by irregular payments. |
