Flexible Premium Adjustable Life Insurance

Flexible premium life insurance is also known as adjustable life insurance. It’s one of the few life insurance policies that are in between term and permanent life insurance.

Learn more about flexible premium life insurance by going through our comprehensive guide on various details about flexible premium life insurance and other variations of the policy like flexible premium variable life insurance.

What is a flexible premium policy?

A flexible premium life insurance policy is a permanent life insurance policy with perks that make it feel like a term and whole life insurance policy. However, flexible premium life insurance allows you to adjust your premium based on your income and may give you the opportunity to borrow money from your life insurance policy.

You’re also able to adjust the interest rate of how your cash accumulates, which is why it goes by other names like flexible premium adjustable life insurance.

How does a flexible premium life insurance policy work?

As permanent life insurance, a part of flexible return of premium life insurance goes toward life insurance. The other part of the monthly premium goes to the cash value that accumulates over time. You have the option to pay higher rates per month that gains interest.

Therefore, you’ll maintain your death benefits (the amount of your coverage if you pass away) and the cash value that’s collecting with your life insurance company.

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How is flexible premium life insurance different from other policies?

Flexible premium life insurance works like whole life insurance, but whole life insurance has a fixed interest rate. Both permanent life insurance policies aren’t allowed to make investments in the stock market.

You can get a flexible premium variable life insurance policy if you want stock market investment options.

What about flexible premium life insurance with indexed universal life (IUL) insurance and an interest option? Flexible premium variable life insurance carries investment options. It works by taking part or all of your cash value that’s accumulated and investing it into an equity index like the S&P 500.

According to Money-Zine, financial professionals use an equity index to measure an individual or business on how they are performing. These evaluations are compared to other competitors in the same industry.

Flexible Premium Life Insurance Pros and Cons

Getting flexible premium life insurance from companies like MetLife has pros and cons. Let’s explore the advantages and disadvantages of flexible premium life insurance policies.

It’s important to remember that every life insurance company conducts policies differently.

Some companies carry higher premiums, while other companies have strict rules on when you can shift policies or decrease payments. Become familiar with your provider’s standards by asking as many questions as possible.

For more information about MetLife, look at our MetLife Life Insurance review.

Four Ways to Use Your Flexible Premium Life Insurance While You’re Living

There are a lot of things that get overlooked under life insurance. Many may not realize they can use your life insurance policy while they’re still living.

We put together four ways you can use your flexible premium life insurance policy.

Cash Flow Banking

Also called infinite banking, this concept says you should borrow money against your death benefits for business ventures, buying a home, or any investment.

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Borrowing money from the best life insurance companies can result in lower interest rates, and you have your entire life to pay off the balance. If you don’t pay off the balance before you pass away, the unpaid balance will be deducted from your coverage amount (death benefits).

Accelerated Death Benefit

An accelerated death benefit is a life insurance rider that allows you to draw money from death benefit value if you’ve been diagnosed with a terminal illness. After you’ve passed away, the remaining death benefit balance will be given to your beneficiary.

Waiver of Premium Rider (WoP)

If you lose your job, become severely ill, or if you’re rendered incapable of work, a waiver of premium rider will allow you to keep your life insurance policy even if you can’t make payments. After you’ve recovered, you can start making payments again.

Cash Value Accumulation

Permanent life insurance policies build cash values. The more you pay per month, the more this cash account grows. Some policies carry interest rates, which makes these accounts grow over time.

However, converting your flexible premium life insurance from permanent to term life insurance will disrupt your chances to use a cash value life insurance accumulation account.

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Flexible Premium Life Insurance: The Bottom Line

Who benefits the most from flexible premium life insurance? The average person can benefit from flexible premium life insurance. It has a versatile interest rate for cash savings, and it allows policyholders to adjust premiums that help their budget.

The downside to the flexible premium adjustable life insurance policy is the price. Permanent life insurance, like whole or universal life insurance, has higher rates than term life insurance quotes.

Are you ready to buy flexible premium life insurance? You can find cheap, flexible premium life insurance rates in your area by comparison shopping.

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