What Is Universal Life Insurance Vs. Whole Life? 
Heres a simple model for you . I am sure you know about term insurance . This is a product designed to give you the absolutely lowest premium for a certain amount of time . The premium and death benefit could be guaranteed from 10 to 30 years . No cash will be accumulated for your use . -LRB- Of course , that is one big reason why the premium is so low -RRB- . The problem we all face with term insurance is that once the guarantee period is over , the price typically skyrockets . I have actually see the premium increase tenfold at the time of renewal ! Now lets suppose that you could have something that would act like permanent term insurance . The premium would be as low as can possibly be . No cash would be accumulated . But the price would never go up . You would have , in essence , a lifetime guarantee . That , my friend , is called guaranteed universal life insurance . Whole life insurance is very similar . Guaranteed premium . Guaranteed death benefit . Lifelong coverage . The big difference is that whole life insurance also emphasizes cash accumulation . It provides very strong guarantees on the cash . So it costs a lot more than guaranteed universal life insurance . It should be noted that providing a lifetime guarantee is only one of a variety of uses for universal life insurance . It is a flexible product and can be designed to accumulate cash as well . It can also be designed to accommodate a variety of premium payments . But when the financial planning objective is to secure a lifetime coverage at the lowest possible guaranteed cost , there is no better product . 