Indexed Universal Life

What Is Indexed Universal Life Insurance (IUL)?

Indexed Universal Life (IUL) insurance policies can help you to build wealth while leaving behind a death benefit for your loved ones. These policies put a portion of the policyholder’s premium payments toward annual renewable Term Life, with the remainder added to the cash value of the policy after fees are deducted. On a monthly or annual basis, the cash value is credited with interest based on increases in an equity index. 

While IUL insurance may prove valuable to some, it’s important to understand how it works before purchasing a policy. There are several pros and cons in comparison to other forms of life insurance.

KEY TAKEAWAYS

• Indexed universal life (IUL) insurance policies provide greater upside potential, flexibility, and tax-free gains.
• This type of life insurance offers permanent coverage as long as premiums are paid.
• Some of the drawbacks include caps on returns and no guarantees as to the premium amounts or market returns.
• An IUL policy may be canceled if you stop paying premiums.
• In general, these policies are best for those with a large up-front investment who are seeking options for a TAX - FREE Retirement