Wondering what happens when universal policy cash value goes to zero (agent seems to contradict policy).
My in laws have a "Guarantee Advantage UL" policy from Brighthouse. The cash value has been rapidly decreasing, and is expected to reach zero soon. The owner of this policy is 70. I'll copy some of the terms below.
Based on these terms, what happens when the cash value goes to zero if they continue to make the $119/month payments. Does the policy continue for 5 more years, or until age 99? And what if they stop making payments once the cash value goes to zero?
CONTINUATION OF INSURANCE WITH THE NO-LAPSE GUARANTEE
Coverage Continuation Rider (aka No-Lapse Guarantee) is a rider included in your policy that prevents your policy from lapsing due to insufficient cash surrender value.
-If you continue to pay your planned monthly premium of $119.00 in full and on time your policy will remain inforce until age 99.
-If you pay no further premiums, your Coverage Continuation Rider is expected to keep your policy inforce until age 74.
– If you no longer have a lifetime death benefit guarantee and you wish to restore it to lifetime, all future monthly premiums will be $154.00.
CONTINUATION OF INSURANCE WITHOUT THE NO-LAPSE GUARANTEE
If you continue to pay your planned monthly premium of $119.00:
-Under guaranteed assumptions, your policy is expected to lapse at age 72.
-Under current assumptions, your policy is expected to lapse at age 75.
If you pay no further premiums, your policy is expected to lapse:
-Under guaranteed assumptions, your policy is expected to lapse at age 70.
-Under current assumptions, your policy is expected to lapse at age 71.
NO-LAPSE GUARANTEE This policy provides a 5-Year No-Lapse Death Benefit Guarantee unless the policy has been reinstated. After the 5th policy year, the premium required to keep the policy in-force could increase dramatically. As of the date of this report, the 5-Year No-Lapse Monthly Premium benefit is not in effect.
submitted by /u/Hatsuwr
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