Indexed Universal Life Insurance (IUL), Explained

Find out how indexed universal life insurance (IUL) works and if it’s a good idea or a horrible idea.

[abhishektripathi]

Dude, listen to yourself...please don't act like an expert until you really know what you are talking about...you are saying the money is invested straight into the Index funds...that tells how much you know about IUL.

[alexc.gaydos]

An IUL does not invest in an index fund. An insurance company use the premium dollars to purchase options. Either you earn a return to the contract value of your account or the options the insurance company purchases, expire worthless. The customer who purchased an IUL, will never lose their money gained in an IUL, as long as policy is in force and funded properly. Cash value has a lock and reset process where if a customer is credited, they will never lose that money because it locks in and reset for the next period. This is how an IUL policy can grow quickly due to a compounding effect.

Referencing the down falls of an IUL, that happens when a customer is not properly funding an IUL. I don’t agree they are the right policy for everyone but they are great for customers who want to buy term and “invest” the rest under a tax-free umbrella, and not worry about market volatility.

Happy to discuss and clear up the some of the inaccuracies in this video.

[paoxiong]

Tell them about when they need to renew their term.

[vido]

Wrong they don’t use my cash for the loan they use the insurance company’s policy fund

[zoovnpiv]

I have seen lots of family benefits from this IUL. Especially the living benefits that is included with the policy.

[rukiddingmeNJ]

IUL is NOT an “investment”! There is NOT an “investment account”, IUL cost more than term because it’s PERMANENT COVERAGE, it’s NOT “specifically invested in index funds”, your ROI is “slightly lower than the performance of the index” That’s because of a cap! the commissions are paid by the carrier at the time of policy delivery, NOT out of an “account”, premium or partial premium may be paid out of policy cash if the selected index underperforms that year, you don’t have to pay ANY permanent life insurance “for the rest of your life”, you DON’T “borrow your own money”. For policy loans, there are several interest options and some are credited back to the policy owner. Just about everything said in this video is false! Go ahead and sell your term insurance on YT but don’t spew bullshit about something you don’t know anything about. You’re welcome.

[carmens]

Whoa this guy has a LOTTA half truths. If you had a paid-up IUL, (1) you just left your beneficiary MORE than that lump sum, and it's tax free (2) the cash value is growing at the indexed rate, with NO losses (3) You could loan yourself that car and pay it (yourself) back like a car payment - mind you WHILE it's still earning, and hence be your own bank. He's right - these aren't to "make you rich". They are to save yourself a TON of cash by using the money you would have had sitting, making the inheritance tax free, and using the money while it earns. He needs to go back to the drawing board.

[sheenaforde]

I heard a lot of wrong statements in this video. He's not talking about an IUL. It sounds like a (non-index) universal life policy, which I still think he is wrong about. And he didn't talk about living benefits.

[allengill]

One type of Insurance that I would highly recommend to someone older who maybe unsure about an IUL would be a final expense policy. This would pay for the funeral in the event that someone does not have A Mutual Fund or an IRA or maybe an Annuity.

[calvinlomeli]

In an Iul with an increasing option your family will have access to both death benefit and cash value when we pass away not sure why he only mentioned a level option?

[mattseibert]

This guy is a hack. A lot of things were taken out of context and not told the full story....

[tyee.]

I don't know what kind of policy he has or where he got it, but the insurance agent does not collect a commission every single month for eternity. They only collect a commission for the first year, and that doesn't come out of your premium or investment account. You can see how much money is going towards your cash value. The commissions are a percentage pf the yearly premium, most cases not 100% of that premium, but more like 30-80% depending on what kind of commission set up the agent has with the company they work with. 500/month x 12= 6k x 30% = $1800, x 80% = $4800... I dont knwo what the average commission is, but thats bot absorbatant. That doesnt even pay my bills if i paid to market all month for one sale.

[richarddelossantos]

Bro its depends what porfolio you prefer in ul with cash value.

[Emajeninc]

"You need to structure it properly" 😂 default response

[johnwebb]

This guy doesn’t understand the IUL strategy. He gave the wrong definition of "indexing" and just insulted the product with no actual data to back up what he’s saying. Also, his made up example with the death benefit is also not true. You can have an "increasing death benefit" and keep both the cash value amount and the death benefit.

[AldoVenturacci]

About 7% of what you said is true and accurate. The rest is either pure ignorance and malicious misinformation.

[sleepysammy]

#2 of 5
The insurance company isn’t paying out a $1, 000, 000 death benefit if you have any amount of payments made plus accumulation value they are paying the death benefit minus your payment accumulations and minus the account value accumulation minus fees.

Not sure why these so-called experts keep repeating the same lies.
Insurance death benefits are paid out based on “Net At Risk” (Insurance 101)
This leads me to the cost of insurance lie – or misleading statements.
The per cost of insurance does go up over time but the total cost of insurance drastically reduces over time.
Using the same scenario as above. If you have a 1, 000, 000 policy and by age 55 you have $500, 000 of cash value in the policy, you are no longer paying for $1, 000, 000 of life insurance. You are only paying for the net at risk which is $500, 000 in this example.
So, YES! The per cost of insurance goes up but the total cost of insurance drastically decreases because you are no longer paying for the initial death benefit amount.
Insurance 101

Can you now see how both of these two items go hand in hand? Very easy to understand right?

Please stop with the “trickery of the tongue”!

The insurance company doesn’t keep your cash value and the overall cost of insurance drastically goes down over time.
All of the IUL policies I quote are very transparent and provide you with the fee information upfront!
If the goal of the IUL policy is for maximum cash value accumulation and it’s structured for maximum cash value accumulation, then most of these products have fees that equal 1% or less over the life of the policy (25 plus years)!
The largest fee you’ll pay on a IUL drops off in year 10 for the majority of the IUL’s sold with a few dropping off by year 15.
IUL policies are front-loaded, if you die after only paying $3, 000 for a $1, 000, 000 policy the company’s net at risk is over 99% because you’ve only paid .003%
Now assuming you are putting $100, 000 into this IUL over 7 years versus dropping $100, 000 in a managed account. Which sum of money would your family rather have the $1, 000, 000 or $100, 000 + interest if you died after the first year?
I think this is an easy question to answer.

[prissy]

An IUL is not an investment, it’s a life insurance policy. Not certain why people who are not licensed in life insurance would even try to explain something they have no clue about. And, if any of you are what a shame that you give incorrect information about a product.

[sabrinamozader]

What about the fees you pay to a financial advisor? I am very open to what is best. I am entering insurance and I am a blue collar born and raised and wants what's best for the people I will be serving.

[arthurcosper]

What if i told you Zander Insurance makes 125% of your first year premiums on term, and they give Dave a huge cut to be the exclusive life insurance All insurance pays commissions, more than most salesman are willing to admit. Dave makes millions on pimping Zander and they make millions pimping term.