{"ok":true,"canonical_url":"https://dealroom.so/glossary/universal-life-insurance","api_url":"https://dealroom.so/api/public/glossary/universal-life-insurance","data_freshness":{"sba_records_through":"2026-05-31","fdic_records_through":"2026-03-31","dealroom_last_updated":"2026-06-15","timezone":"America/Chicago"},"source_summary":["Public SBA 7(a) loan records","FDIC institution data","DealRoom lender and franchise enrichment"],"term":{"slug":"universal-life-insurance","term":"Universal life insurance","group":"The loan itself","definition":"A type of permanent life insurance policy that offers flexible premiums and a savings component. While permanent, the SBA typically prefers term life for its collateral requirement due to simplicity.","what_it_means":"While Universal Life Insurance can technically fulfill the SBA's life insurance requirement, lenders often prefer term life policies. The cash value component of universal policies can complicate the assignment process. Discuss with your lender which type they prefer to avoid delays.","url":"https://dealroom.so/glossary/universal-life-insurance","official_sources":[],"related":[{"slug":"life-insurance","term":"Life insurance","url":"https://dealroom.so/glossary/life-insurance"},{"slug":"life-insurance-requirement","term":"Life insurance requirement","url":"https://dealroom.so/glossary/life-insurance-requirement"},{"slug":"life-insurance-assignment","term":"Life insurance assignment","url":"https://dealroom.so/glossary/life-insurance-assignment"},{"slug":"key-principal","term":"Key principal","url":"https://dealroom.so/glossary/key-principal"}],"related_questions":[{"question":"When is term life insurance more suitable than permanent life insurance for business protection?","url":"https://dealroom.so/sba-7a/questions/when-is-term-life-insurance-more-suitable-than-permanent-life-insurance-for-business-prote"},{"question":"Can a lender rely on a universal life insurance policy that has a cash value for a collateral assignment on a 7(a) loan?","url":"https://dealroom.so/for-lenders/questions/can-a-lender-rely-on-a-universal-life-insurance-policy-that-has-a-cash-value-for-a-collate"},{"question":"How does disability insurance complement life insurance for business protection?","url":"https://dealroom.so/sba-7a/questions/how-does-disability-insurance-complement-life-insurance-for-business-protection"},{"question":"How does business overhead expense insurance differ from key-person life insurance?","url":"https://dealroom.so/sba-7a/questions/how-does-business-overhead-expense-insurance-differ-from-key-person-life-insurance"},{"question":"Is a decreasing term life insurance policy acceptable for the SBA's life insurance requirement on a 7(a) loan?","url":"https://dealroom.so/for-lenders/questions/is-a-decreasing-term-life-insurance-policy-acceptable-for-the-sba-s-life-insurance-require"},{"question":"Why is long-term disability insurance considered a vital complement to business life insurance?","url":"https://dealroom.so/sba-7a/questions/why-is-long-term-disability-insurance-considered-a-vital-complement-to-business-life-insur"}]},"caveats":["Definitions represent DealRoom's plain-English interpretation for buyers; verify regulatory terms against the official SBA and eCFR sources listed.","Not legal, tax, or financial advice, and not an SBA eligibility determination."],"citation":{"label":"DealRoom.so Glossary — Universal life insurance","url":"https://dealroom.so/glossary/universal-life-insurance","source_type":"DealRoom Data"}}