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Adjustable Life Insurance Policy

Adjustable life insurance may also be called flexible premium adjustable life insurance or flexible premium insurance because you can adjust the coverage period, face value and premium payments.1

As the name implies, adjustable life insurance allows the policyholder to adjust the terms of the plan as needed. An adjustable life policy and traditional term and whole life plans have many similarities. The difference is that adjustable life insurance can have more variability.2

Adjustable life policies usually have a cash value component, like a whole life policy. Cash value is a savings-like account that earns interest over time.3 Policyholders may be able to make changes to the cash value and borrow against it in the form of a loan.

While Aflac doesn’t offer adjustable life insurance, we do offer traditional whole life insurance with cash value and term life insurance with personalized coverage length.

Comparing Whole, Term and Adjustable Life Policies

With term life insurance, you determine the length of the life insurance policy upfront, otherwise known as the term length. With a whole life insurance plan, the coverage lasts the entire life of the policyholder.

In both term and whole life plans, you determine the face value upfront. The face value is the dollar amount the beneficiary will receive, also known as the death benefit, plus any additional benefits your plan has.4 Then, premiums are paid to keep the plan active. With an adjustable life insurance plan, you can make changes to the term length, premium schedule, and the face amount of the plan.5

While Aflac doesn’t offer adjustable life insurance, we do offer term and whole life insurance with versatile benefits that may be able to meet your coverage goals. In our term life insurance plans, you may be able to extend the length of your plan as needed if you already own one. And with our whole life insurance plans, you may be able to make changes to the cash value.

If flexible premium payments are what you are looking for, we also offer final expense whole life insurance with customizable premium schedules. You can pay premiums monthly, quarterly, or annually depending on your needs.

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How Does an Adjustable Life Insurance Policy Work?

An adjustable life insurance plan has three main features that can be adapted as needed without penalty.6

  • Premiums: Premiums are typically determined by the face amount of your plan, as well as your age and gender.7 You can adjust how much you spend on premiums and how often you make these payments as your financial situation changes.8
  • Face Amount: You can scale up the payout you leave for beneficiaries if you would like to provide more support or scale this value down if circumstances change.9 You may be able to adjust riders or any additional benefits too.
  • Cash value: You also may be able to change how much money is put toward the cash value of your plan. However, making changes to the premium schedule and face amount will affect the interest rate and how the plan’s cash value grows. This is something to keep in mind when molding your adjustable life insurance policy.10

Pros and Cons of an Adjustable Life Insurance Policy

A lot can change in the years you own a life insurance plan. Having a life insurance policy with adjustability allows you to make changes as your life and financial situation evolve.

If you have grandchildren, you may decide you want to scale up the face value of the plan and provide greater financial support for your family. On the other hand, you may buy a home and want to scale back your coverage to save money. The built-in flexibility of adjustable life insurance plans is a major advantage.

On the other hand, you are only allowed to change your adjustable life insurance policy within specific parameters. You must request a change to your plan within a certain time frame and that change must fall within your insurer’s regulations. The dates for requests and changes allowed depend on each company’s guidelines.11

Get a Quote for Aflac Life Insurance

While it can be helpful to make changes to your plan, the main difference between adjustable life insurance plans and traditional term or whole life insurance plans is that you can make changes to the policy later. Even though it can be helpful to have the flexibility to change your plan later, whole or term life insurance plans can also provide the coverage you are looking for.12

Some people may find it easier to commit to a solid life insurance plan upfront and move forward without changes. At Aflac, you have life insurance options to fit your lifestyle and needs. Our life insurance plans are affordable, portable, and you may be able to skip the medical questions. Chatting with an agent can help you explore your options.

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