Are UNIVERSAL LIFE Investment Returns Competitive?
The investment returns in a Universal life contracts tend to be on the conservative side as apposed to the investment choices in Mutual Funds. The investment rules for insurance contracts tend to lean toward fixed instruments like bonds, mortgages and T-bills. Some creative insurers have mad the most of this by using T-Bills and derivatives to emulate stock market indexes around the world. This financial technique allows world wide diversification within the investment rules. An added value is the virtual elimination of the foreign currency risk by doing daily buy & sells. This makes some Universal Life policy investment yields quite attractive and competitive.
