Who Buys Universal Life Insurance?

Shawn Plummer

CEO, The Annuity Expert

Benefits of Universal Life Insurance

  • Cost-Effectiveness: Can be more affordable than whole life insurance due to fewer guarantees.
  • Flexibility in Payments: Allows varying of premium amounts and adjusting the death benefit.
  • Cash Value Component: Some policies build up cash value, useful for loans or withdrawals.

Disadvantages of Universal Life Insurance

  • Complexity: Different types with varying features can be difficult to understand.
  • cash value Uncertainty: Not all policies guarantee gains on the cash value.
  • Impact of Loans and Withdrawals: Can reduce cash value, potentially causing policy lapse without extra payments.
  • Active Management Needed: Variable universal life insurance requires managing underlying sub-accounts.

Indexed Universal Life Insurance (IUL)

  • Benefits: Offers lifelong coverage, flexibility with death benefits, and premiums.
  • Who Benefits: Suitable for those seeking flexibility and willing to take investment risks.

Variable Universal Life Insurance (VUL)

  • Features: Allows varying premium payments and death benefit amounts.
  • Who Benefits: Ideal for individuals who want to actively choose sub-accounts for policy’s cash value. Not suitable for risk-averse or those preferring passive investments.

Guaranteed Universal Life Insurance (GUL)

  • Characteristics: Offers stable death benefit and premium payments.
  • Who Benefits: Best for those seeking lifelong coverage without the focus on cash value investment. Less flexibility in premium payments and death benefits compared to other types.


Universal life insurance offers a blend of flexibility and investment opportunities but comes with complexities and risks. The choice of policy type depends on individual needs and risk tolerance. Understanding the unique features of each type is crucial in making an informed decision.

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Shawn Plummer

CEO, The Annuity Expert

Shawn Plummer is a licensed financial professional, insurance agent, and annuity broker with over 14 years of first-hand experience with annuities and insurance. Since beginning his journey in 2009, he has been pivotal in selling and educating about annuities and insurance products. Still, he has also played an instrumental role in training financial advisors for a prestigious Fortune Global 500 insurance company, Allianz. His insights and expertise have made him a sought-after voice in the industry, leading to features in renowned publications such as Time Magazine, Bloomberg, Entrepreneur, Yahoo! Finance, MSN, SmartAsset, The Simple Dollar, U.S. News and World Report, Women’s Health Magazine, and many more. Shawn’s driving ambition? To simplify retirement planning, he ensures his clients understand their choices and secure the best insurance coverage at unbeatable rates.

The Annuity Expert is an independent online insurance agency servicing consumers across the United States. The goal is to help you take the guesswork out of retirement planning and find the best insurance coverage at the cheapest rates

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