Universal life insurance is a type of permanent life insurance which is also known as 'jumbo' insurance. The premium paid is used to pay for the life cover of the policy with the rest going towards the savings part of the policy, which has a cash value.
Universal life policy premiums are typically paid in one lump sum up front, but most insurers offer a multi-pay option which allows the premium (cost) to be spread over several years, typically 5 to 30 years. The life insurance company will charge a higher overall premium if the multi-pay option is chosen to compensate for not receiving all of the premium up front.
Premium finance for universal life insurance policies is also available which allows the policy owner to finance up to 100% of the policy value. Universal life insurance policies are usually bought by high net worth individuals who want greater choice and flexibility in the investment part of their permanent life insurance policy.