Lifelong financial protection for your family and an extra-competitive interest rate for your savings to grow? Beginning Dec. 1, Catholic United’s universal life insurance policies are updated to meet the needs of active, longer-living individuals.
Universal life is often misunderstood or considered too complex, but the basics are fairly simple:
• Your life insurance policy lasts your whole life (up to your 121st birthday.)
• You pay an annual premium for the life of the policy, which can be broken into monthly, quarterly, or yearly payments.
• The unique feature of universal life is that in addition to providing a face value death benefit, it acts a bit like a savings account and a bit like a collateral asset.
• A portion of your premium funds the death benefit, but another portion is put into a cash balance, which you can withdraw for you own needs, or borrow against as a “policy loan.”
• The policy’s cash value acts as collateral; if you fail to pay it back, it will be paid back from the cash balance.
• The cash balance is in addition to the face value, so if you die, your beneficiaries will receive both, income tax free.
• The savings portion also earns an interest rate. Because the funds are so well protected, we can offer an interest rate otherwise nearly impossible to obtain – 3.75 percent!
• Once it reaches a certain balance, the cash reserve can actually be used to pay the premium, so the policy can become somewhat self-sustaining.
Our updated policy increased age of maturity to 121 years, which (virtually) guarantees no one can outlive it. We have also updated our interest rate to 3.75 percent, and guarantee that the interest rate will never drop below 2.25 percent. Current CD rates, depending on length of deposit, are hovering between 0.60 percent and 2.20 percent. But to receive the 2.2 percent, you’ll need to lock up your money for 10 years.
Universal Life may be a little more complex than other life insurance products, but because of its versatility as a savings vehicle and lifelong asset, it can act as a “universal” financial product that both protects and serves. No one is better positioned or educated to inform you about universal life insurance than your local Sales Representative, so give yours a call today to learn how you can step into a financial decision that can be tailored to be just right.
*Minimum face amount of $50,000 required ages 18-64; $35,000 ages 0-17 and 65-80. **Policy premium per/$1,000 is affected by face value, with four “bands” to choose from: $35,000 – $99,999; $100,000 – $249,999; $250,000 – $499,999; $500,000+.