Adjustable life insurance allows policyholders to change coverage and premiums. It offers flexibility to decrease or increase benefits, making it useful for those with changing financial circumstances. It differs from variable life insurance as the death benefit amount is fixed. It provides comparable benefits to other life insurance coverage and is available from many insurance companies.
Adjustable life insurance is an insurance option that makes it easy for policyholders to change the amount and scope of coverage offered by the policy, while changing the monthly premium. In general, life insurance of this type allows for adjustments in the premiums, the period of protection, and the face amount associated with the policy. In some cases, the policy may also allow the policyholder to change the premium payment terms, such as going from a monthly payment to a quarterly payment.
It is important to note that most adjustable life insurance policies allow you to decrease or increase the benefits associated with them. This can be very useful for someone who is unemployed for an extended period of time and has to keep an eye on all expenses. Instead of having to drop coverage, the insured opts for a lower benefit schedule and gets a lower premium that is more manageable. At a later date, when financial circumstances improve, the policyholder can change the terms of the policy again to restore the previous level of coverage.
While this type shares some characteristics with variable life insurance, the two are not identical. Variable life insurance allows the death benefit amount to fluctuate based on the performance of the investments that underwrite the coverage. By contrast, adjustable life insurance does not include a floating death benefit; instead, the amount of the death benefit is set according to the terms and conditions of the policy.
In terms of quality, adjustable life provides benefits that are comparable to other forms of life insurance coverage. The plan provides some flexibility for the policyholder to modify coverage as their life circumstances change. For example, an adult with an adjustable policy may choose to increase coverage after getting married or having children. Similarly, an insurance package allows a low-income person to purchase coverage from time to time and then gradually increase benefits as annual salary or wages increase over time.
Many insurance companies offer this type of insurance coverage along with other plans. People who may be interested in this type of policy should speak with an insurance agent to get more details about how their adjustable plans work and what kind of flexibility is available with the plans.
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