Universal life insurance was developed in the 1970’s, when insurance industry regulations changed so that companies could be more competitive with other financial services industries. It is more flexible than traditional whole life because the premiums can vary from year to year and sometimes the premiums can even be skipped.
Universal life has maximum guaranteed premiums and at least minimum guaranteed cash values and death benefits. Instead of dividends, universal life policies earn interest at the “credited interest rate” determined each year.
