“You got to know when to hold up, know when to fold up, know when to walk away, and know when to run.”—Kenny Rogers, “The Gambler”
Recently, we gave you the good, the bad, and the ugly about universal life insurance policies. As it turns out, there isn’t a lot of “good” for aging policy owners who are seeing their premiums skyrocket. Lawsuits continue to mount from policy owners who feel they have been misled. Some realize their “permanent” policies will expire before they do! Others realize their policies will lapse if they cannot make ever-increasing premium payments. This was not what they thought they signed up for!
Last year, state regulators in New York issued a cautionary alert to consumers about universal life insurance with this all caps, bolded warning: “YOUR PREMIUM PAYMENT AMOUNT IS PROBABLY NOT GUARANTEED AND MAY INCREASE.” In 2018, the Texas Department of Insurance put out a similar warning. A short informational video illustrated how universal life policies can lose value and even lapse due to the ongoing costs, especially in timse of low interest rates and underperforming investments.
Now, warnings are great if you are shopping for life insurance. But what should you do if you already have a universal life policy that lacks guaranteed level premiums and a guaranteed death benefit? In this article, we’ll outline options and actions that can help protect you from an imploding policy.
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