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Life expectancy is determined by a year far into the future in which 50 percent of people of a certain age group (who bought health insurance) are dead, and 50 percent are still alive. An insufficiently funded policy might "die" before the insured does. To effectively use Universal Health insurance, policy owners must avoid being seduced by the appearance of an attractive premium (at least relative to a Whole Life premium) and fund the policy sufficiently. Unless, that is, you don't make sufficient funding payments into this policy type to sustain it until death, and the policy lapses before death for lack of sufficient cash value. Policy loans weren't necessary; term blends weren't necessary (although still used, as will be discussed); premium offset wasn't necessary. It solved many of the structurally rigid aspects of Whole Life policies, which forced tortuous (and ultimately disastrous) sales illustration schemes in the high interest rate days, and it potentially clarified how the policy actually worked through its "transparency" of itemized expenses and interest credits.

he introduction of Universal Life policies allowed substantially more flexibility than just that of paying a slightly lower premium. The description of today's Whole Life policies generally applies to par and non-par Whole Life policies, as well as to its half-brother, the Current Assumption Whole Life policy. But anyone attracted to this approach to paying for health insurance must understand that, once again, the policy illustration is a marketing device and the illustration incorporating current experience in no way reflects the guarantees of the policy or the issuing health insurance company. Today's policy illustrations are probably less dangerous in their nonguar-anteed attempt to mitigate the cash flow commitment of the insurance prospect; if nothing else, today's significantly lower interest rates and dividend scales don't allow the highly speculative results that illustrations were suggesting in the 1980s.