Universal life insurance

What is universal life insurance?

Universal life insurance offers adjustable, lifetime coverage to meet the changing needs of your business. It can help protect your company and your family in the event of an unexpected death, and allows you to take a more active role in your insurance by managing your investment account and payment schedule.

Who is it for?

Universal life insurance is ideal for business owners seeking coverage that can adapt to their business. Unlike term life insurance – which only offers coverage for a set period of time – universal life insurance provides coverage for life, provided premiums are paid. It is a good fit for those who wish to actively manage an investment account and are comfortable with the associated risks. In addition, it lets you customize your permanent insurance solution by taking advantage of the flexibility that comes with universal life insurance coverage.

How does it work?

The money you pay goes into a policy fund that’s used to pay for the cost of your insurance coverage. The remaining balance is invested on a tax-advantaged basis. You choose from a variety of investment account options based on your objectives and tolerance for risk.

The growth of your investment account depends on how well your investments perform, and the size of your premium payments. The money in the account can be used to help make future premium payments or provide a source of future savings. That money can be borrowed against, withdrawn or left to your beneficiaries.  Keep in mind that any unpaid loans or withdrawn money from your policy will reduce both its cash value and the amount of money your beneficiaries receive when you die.

How does it benefit your business?

Keep your business running

If you die, proceeds from your insurance can be used to pay off debts, keep daily operations going until a buyer can be found or a family member or key employee can take over the business. The payout can also be used to train a replacement employee and to reassure creditors and suppliers that your business has the funds to continue.

Cost-effective lifetime protection

Universal life insurance can be a less expensive permanent insurance solution, so you can have more capital remaining to support your business – while still knowing you have coverage for life.

Ensure a smooth transition

If your business has multiple owners and one of them dies, the insurance proceeds can be used as a cost-effective solution for purchasing the deceased partner’s shares as part of a buy-sell agreement. An effective buy-sell agreement can help avoid conflict between owners and heirs, and help your business get back on track.

Flexible payment schedule

With any business, cash flow can fluctuate from month to month and covering expenses can be a challenge. Universal life insurance gives you the flexibility to pay extra when business is good (within certain limits), and less when your cash flow is limited, provided you have enough money in your policy to cover the cost of your insurance.

Rates, values and performance

For policies issued from April 12, 2004 to December 31, 2016 with client bonus

For policies issued prior to April 12, 2004