211k views
2 votes
What could happen during a Universal life policy if there is negative investment growth?

User Sellotape
by
8.3k points

1 Answer

6 votes

Final answer:

Negative investment growth in a Universal Life policy can result in cash value reduction, premium increases, and surrender charges.

Step-by-step explanation:

In a Universal Life policy, negative investment growth can have various implications. Here are some possible outcomes:

Cash value reduction: If the investments in the policy underperform and generate negative growth, the cash value of the policy may decrease.

Premium increase: In some cases, negative investment growth may lead to increased premiums to make up for the shortfall in returns.

Surrender charges: If the policyholder decides to surrender the policy due to negative investment growth, they may be subject to surrender charges or fees.

User Algorhythm
by
7.8k points

No related questions found

Welcome to QAmmunity.org, where you can ask questions and receive answers from other members of our community.