This can depend on various factors. If you have had your policy
only a short time, replacement probably would not be advised.
You may suffer surrender penalties that would take too long to
recoup. It could be very wise to replace older universal life
policies, especially if you plan to keep the policy for quite a while
longer. Here's a true life example: Mr. X has had a universal life
policy for 14 years. He is 48 years old. His death benefit is $100,000.
He is paying $60.00 per month into his policy, and he has a loan of
$2,310. If he continues the policy as it is, based on projected and
guaranteed values, it will lapse in about 13 years. That means it
will just end - no death benefit and no cash value. His wife is also
on the policy for a $25,000 benefit. If he were to change to an
updated universal life policy, WITHOUT PAYING ANY ADDITIONAL
PREMIUM, he could do the following:
1. Eliminate the loan.
2. Extend his $100,000 death benefit from 13 years to 35 years.
3. Provide a death benefit of $50,000 for his wife.
4. Have a projected cash value of $13,000 at age 65 instead of 0.