Is my rate guaranteed?
Term life insurance and whole life insurance guarantee your life insurance rates. Universal life insurance does not. Regardless of which of these three types of life insurance you purchase, however, your rate class is guaranteed for as long as the policy is in force.
Term life insurance and whole life insurance
A guaranteed rate does not necessarily mean a fixed rate (one that is constant throughout the force of a given policy). Rather, what is meant is that all of the premiums for the entire lifetime of the policy are set at the time the policy goes in force. They're not calculated at the time they're due.
Standard term life insurance and traditional whole life insurance have level premiums, which means that every premium is in the same amount. However, policies with increasing premiums can also be found for whole life insurance. Modified premium and graded premium life insurance allow you to pay lower premiums initially and make up for that lenience by paying greater premiums later. Still, the amount of each premium is guaranteed from the start of the policy.
Universal life insurance
Universal life insurance does not offer guaranteed life insurance rates. With universal life insurance, you pay whatever amount you please, whenever you please. Your payments increase the cash value of your policy, so making payments is your prerogative.
There is no requirement that you be regular in your payments, but the life insurance company will periodically levy charges against your policy to pay for your cost of insurance and administration, so you had better keep enough money in your policy to cover said charges.
The charges which the insurer makes against your policy are not guaranteed on amount, though they are periodic. Charges vary from one pay period to the next because they are based (in part) on the difference between your policy's face value and your accumulated cash value. The higher your cash value, the cheaper your coverage. The lower your face value (death benefit), the cheaper your coverage.
