One permanent universal life insurance policy has 2 death benefits, while the other has 3, what does it mean?

Question

I mean 2 and 3 death benefit options*

Answer 1

Option 1 = this usually means a level death benefit.  If you bought a $100,000 life insurance policy than this benefit will remain the same.

Option 2 = this usually means increasing cash value death benefit.  For example if you bought a $100,000 permanent policy and you had built up cash value of $10,000, then with this option selected your total death benefit would $110,000.  You add the cash value to the death benefit.

Option 3 = this usually means that your death benefit will increase each year by the amount of premium you put into it.  For example if you buy a $100,000 policy and you pay a premium of $4,000 each year then your death benefit would increase by $4,000 each year.  Death benefit+premium= Net death benefit.

Of these death benefits options #2 & #3 are typically more expensive for coverage.

Answer 2

Do you mean beneficiaries?

Answer 3

Universal life policies depend on the stock averages to tell you what your death benefit is. You should contact the agent who sold you the policy (or his/her company) to get this explanation, because they will need to read the policy for you. Probably, it is a situation where the death benefit depends on the inflation rate being (for example), 3%, 5%, or 7%.