Universal Life Insurance Information from State Farm
Universal Life Insurance
Universal Life insurance is a permanent policy that allows you the
flexibility to customize the coverage and premiums that meet your needs.
Premiums are paid into your policy's account value (after a premium expense charge), where it earns interest. Every month, various deductions, such as a charge for insurance protection, are then made from the account value. You have the ability to take loans or make withdrawals from the account value for your personal needs. Loans accrue interest and unpaid loans plus interest and withdrawals will reduce the death benefit and cash value. The policy continues as long as the cash value is sufficient to cover the various deductions each month*.
Typical Uses:
- Provides for a family's loss of income, mortgage costs, and educational needs
- Access to cash value for life's opportunities
- Estate, special needs, and business planning
A Universal Life policy is a flexible way to help protect your loved ones and build tax-deferred cash value.
Features
- Access to cash value - The cash value can be accessed to help with education expenses, provide a retirement supplement, or other personal objectives.
State Farm offers
Flexible Care Benefit Rider in select states.
Learn More
Survivorship Universal Life covers two people. The death benefit is paid when the last person insured under the policy dies. Survivorship Universal Life is an efficient way to assist with a variety of planning needs.
Features
- Typically less expensive than two individual Whole Life or Universal Life policies
- Flexibility - You decide the amount of life insurance and premium payments subject to policy minimums.
- Death benefit - Life insurance proceeds are generally income tax free to the beneficiary.
- The growth in cash values is tax-deferred under current federal income tax law.
- Access to cash value - The cash value can be accessed to help with education expenses, provide a retirement supplement or other personal objectives.
* With Universal Life it is possible that coverage will expire when either no premiums are paid following the initial premium or subsequent premiums are insufficient to continue coverage.
Joint Universal Life covers two people. The death benefit is paid upon the first death of the insureds. Joint Universal Life offers an economical way of providing permanent coverage to two individuals under one policy.
Features
- Typically less expensive than two individual Whole Life or Universal Life policies
- Flexibility - You decide the amount of life insurance and premium payments subject to policy minimums
- Can raise or lower the coverage - and premiums - to fit the need
- Death Benefit payment after first death
- Life insurance proceeds are generally income tax free to the beneficiary
- Option to purchase another policy for the surviving insured
- Builds an account value, which grows income tax deferred under current federal income tax law
- Ability to withdraw cash (or take loans) from your account when you need it to help with education expenses, provide a retirement supplement, or other personal objectives
- Includes a broad range of riders and features to customize coverage
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Universal Life Insurance
Universal Life insurance is a permanent policy that allows you the flexibility
to customize the coverage and premiums that meet your needs.
Universal Life
Life changes. You get married, you need life insurance. You have kids, you need more insurance. Suddenly the kids are all grown up and the mortgage is paid off. Now, maybe you don't need as much coverage as you used to. It's clear that your need for life insurance changes along with your life. That's why State Farm® offers Universal Life Insurance. This flexible policy allows you to raise or lower your coverage-and your premiums-to fit your needs. It even builds cash value that you can use during your lifetime.
What is Universal Life Insurance?
What are the advantages of Universal Life?
Tax Advantages of Universal Life…
Eligibility
| |
|---|
| Premium Duration | Lifetime |
| Coverage | Starting at $25,000 for ages
0 to 19
Starting at $50,000 for ages
20 to 54
Starting at $25,000 for ages
55 to 85 |
| Issue Ages | 0 to 85 |
How it Works
- Premiums are flexible, you can pay your premiums monthly or annually
- Your premiums (after an expense charge) are added to your account value
- Every month, the cost of insurance for the policy and any riders, and any monthly expense charge are deducted from your account value
- Interest is credited to your account value; the current interest rate may change monthly, but will never be less than the guaranteed rate stated in the policy when you purchased it
- The cash value grows tax-deferred. Cash values can be accessed during your lifetime
- Tax-free death benefit - No matter how large your death benefit, it passes to your beneficiaries generally income tax-free
Death Benefit Options
There are two death benefit options you can choose with a Universal Life insurance policy.
| Option 1 | Option 2 |
|---|
| Provides a level death benefit equal to the Basic Amount of life insurance you choose. | Provides a death benefit that varies with your policy Account Value. Your death benefit is the amount of life insurance plus the policy Account Value. |
 |  |
Customize your Policy
Add even more value to your policy by buying any of these optional riders. A State Farm agent can help you customize a policy to meet your needs.
Additional Insured Level Term Rider
- This coverage is available either on the spouse of the Insured or another person, and provides level term insurance for the amount of the rider. A minimum of $25,000 may be issued. This rider is not available on policies with the Flexible Care Benefit (FCB) rider
- This rider will automatically terminate if the policy terminates by surrender or lapse, if the owner requests its termination, or on the policy anniversary when the Additional Insured is age 95, whichever occurs first
- This rider may be converted at any time while it is in force up to the later of five years from issue or the policy anniversary when the Additional Insured is age 75. Conversion may be made without evidence of insurability, to any whole life policy issued by the company at the time of conversion (subject to the established policy minimums and availability)
- These rates may be adjusted due to projected changes in mortality but will not exceed the maximum rates illustrated in the policy. Such rate adjustments will not occur more than once in a calendar year.
Children's Term Rider
This rider provides temporary insurance for each eligible child that is named in the application, and any eligible children acquired in the future. This insurance can be converted at expiry, regardless of health, to provide continuing life insurance coverage for each child.
Guaranteed Insurability Option
You are guaranteed the right to increase your life insurance coverage by the amount of the rider on specific option dates without evidence of insurability. The Waiver of Monthly Deduction for Disability Rider must be present in order to add this coverage. When you marry or become a parent, you may exercise the next available option.
Waiver of Monthly Deduction for Disability Rider
Helps preserve your plan at a time when income may be limited due to disability. If Insured becomes totally disabled for 6 continuous months, as defined in the policy, prior to age 60, this coverage will waive all future monthly deductions as long as the insured continues to be totally disabled. If the Insured becomes disabled between ages 60 and 65, this coverage will waive monthly deductions to the later of the third policy anniversary after total disability and the anniversary when Insured is age 65.
State Farm offers the Flexible Care Benefit Rider in select states.
Learn More
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