What is the difference between term and universal life insurance?

Life Insurance
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September 2016
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Term life insurance is temporary insurance which will usually terminate after a specified period of time. This type of insurance has a low premium compared with other types of life insurance.  Universal life insurance is flexible coverage which will be temporary or permanent depending on how the policy is funded by the policy owner.  Universal life insurance has a cash value which can be withdrawn by the policy owner, and can be invested in either a fixed interest or variable sub=account.  In a variable sub-account the cash value is invested in assets such as stocks and bonds.  How long the policy lasts will depend upon a number of factors including the premium payments made to the policy as well as the performance of the sub-account.

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