What used to be only prevalent in the United States has already been made available in other parts of the globe and to our dear country—Singapore. I can see your brows knit in confusion now, so let’s cut to the chase and get to the point. I’m talking about none other than Universal Life Insurance.
Universal Life Insurance, is, in all intents and purposes, a specific kind of permanent life insurance. Regrettably, letting you understand its nature would entail talking about some few basic nitty gritty details about it. Don’t worry, I’ll try to be as reader-friendly as possible.
Universal Life Insurance—what is it?
As discussed in our previous blogposts, investing in life insurance entails paying money which we call premiums in order to keep ourselves, our property like our vehicles and house insured. With the payment of premiums, we get a specific type of protection based on the policy we have chosen.
Typically, in a universal life insurance policy, the excess premium over and above the current cost of insurance is given back to the cash value of the policy on a monthly basis together with the interest that has grown. However, in Singapore, what is being practiced is that the cost of insurance (COI) plus other fees are taken from the cash value of the policy.
Simply put, the earning rate is pegged to a bond, financial index, or stock as the insurance company determines what must be credited back to the account which is usually at a minimum rate of about 2%.
Relevance of Life insurance in Singapore
This type of insurance is currently on a global rise and there is a perfectly good reason for that. Those going for life insurance in progressive Asian economies such as Singapore are faced with an even bigger challenge of introducing products that reflect the needs of its customers in keeping with our changing times. If you wish to boost wealth creation, protect your interests in family businesses as shareholders or even plan your legacies (and devisees), then Universal Life Singapore may be the perfect fit for you.
Low Cost Protection
Yep! You read that right. You can get protection of term life insurance at a low cost plus the perks of a savings aspect since this provides a handsome cash value buildup. Furthermore, you are FREE to modify your savings, death benefits, and even premiums depending on your current circumstances on top of your freedom to make the most of your rising cash value increments with a rate that can be adjusted monthly.
- Remains in force even with a zero cash value
- Won’t lapse if premiums have been paid off
- Can be used to lower your current premiums to a minimum
- Guaranteed return throughout the entire life of the policy
- Withdrawable cash values that does not affect your lump sum benefit
I know. It’s a very enticing policy. Again, if you are considering universal life insurance, talk to your financial adviser now. Reach out to us via our Facebook page, or drop us a comment below!