What Is Universal Life Insurance Vs. Whole Life? 
Whole Life has set premiums that never go up , guaranteed cash values , and will be around when you need it as long as you pay the premiums . It also has what is called non-forfeiture values . If you stop making payments and the policy has cash value you can : 1 . Let the policy go on extended term which will provide the full face amount for a period until the cash value runs out . 2 . Take a reduced paid up policy for whatever the cash value will buy . 3 . Cash the policy in . Universal Life has Flexible Premiums , you can change the amount you put into the plan . Flexible Death Benefit , you can change the death benefit , reducing it or if your health is good increase the benefit without having to purchase a new policy . Universal Life has a guaranteed interest rate , not guaranteed cash value . Since the premiums are flexible the danger is in under funding the policy which will make the policy lapse , even if you are making premium payments . Universal Life is basically term insurance with a cash value side fund combined into one package . If there is not enough cash in the policy side fund to pay for the term insurance the policy lapses . It is important to make sure you are properly funding the Universal Life policy by paying at least the Target Premium . Each year you will receive an annual statement showing the cost of the term insurance and the amount of cash in the policy . Have your agent review this with you at least every two years to make sure it is performing as planned . As you can see , while the Universal Life has some attractive features , Whole Life is a safer more stable product . 