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UNIVERSAL LIFE INSURANCE

Risk Management

Our insurance professionals represent many of today’s major insurance carriers to provide life, long-term care, and disability insurance solutions for clients. 

Universal Life Insurance

Universal Life Insurance with No Lapse-Guarantees (NLG) offers the lowest guaranteed premium of any policy type for beneficiaries who need the death benefit for an extended period of time.  Because in many cases the coverage is guaranteed for life and there is little or no cash value, Universal Life with NLG can be thought of as term for life.

How does Universal Life with NLGs Work?

As long as the premium is paid in a timely manner, Universal Life with NLGs offers a guarantee that the owner will receive the death benefit.  The owner of the policy must make sure that the planned premiums are paid as scheduled.  If the premium payments are late, the owner could lose the no lapse guarantee.  Many carriers do not allow the owner to reinstate the guarantees once they are lost.  However, if the guarantee is in effect, some companies allow a catch up premium that will allow the owner to make up for missing one or more of the required premiums.

These policies put the owner in the driver’s seat to make choices through:

  • Flexibility to select the length of the guaranteed death benefit protection up to lifetime coverage.
  • Flexibility to select the amount and length of the premium payments (so long as the annual and cumulative premiums are sufficient to keep NLG provisions in effect).

Advantages

  • The owner of the policy pays the least expensive premiums to guarantee a lifetime or term certain death benefit.  The owner of the policy knows what they are getting – guarantees.  
  • The owner of the policy has transferred the “risk” of the policy to the insurance company.
  • The premiums and number of premiums are guaranteed.  As long as the premiums are paid in a timely manner, this provides the owner with certainty.
  • The premiums/death benefits are competitive when compared to other policies.

Disadvantages

  • The guarantees offered by the policy rely on the financial strength of the insurance carrier.
  • These types of policies build cash more slowly than whole life and traditional universal life policies.  These policies are not appropriate where cash value accumulation is a goal.
  • The owner of the policy may not be able to borrow funds from the cash value of the policy without affecting the guarantees in the policy.
  • In order to keep the guarantees in force, it is imperative that the owner ensures all premiums paid when due and in the amount necessary to keep the NLGs in effect.  The no lapse guarantees are highly time and amount sensitive.
  • These policies offer the owner of the policy little upside benefits (if the credited policy interest rate rises the premiums are not reduced).

For more information, please call 601.208.8606.

Insurance products are offered through Fisher Brown Bottrell Insurance, Inc., a licensed insurance agency and wholly-owned subsidiary of Trustmark National Bank.

Insurance products:

Not FDIC Insured

Not Bank Guaranteed

May Lose Value

Not Guaranteed by any Government Agency

Not a Bank Deposit

 
 
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