What is Indexed Universal Life Insurance?

Indexed universal life, or IUL, is a type of universal life insurance product that offers a death benefit and a cash value. The death benefit is the amount that is guaranteed to pass on to a person’s designated beneficiaries tax-free. The cash value is the extra money that is put inside the policy that will be invested and acts like your own personal bank of money. The cash value can be used to pay policy premiums or take withdrawals and loans. The cash values’ performance is tied to a market index, like the S&P 500. Being tied to an index gives IULs an advantage over other types of cash value life insurance because you are likely to have a higher rate of return. Furthermore, you are guaranteed to never lose money when the index goes down. However, the performance is usually capped at a maximum level of return. Often, you will be able to divide your assets between fixed and indexed portions of your policy.

Informational statements regarding insurance coverage are for general description purposes only. These statements do not amend, modify or supplement any insurance policy. Consult the actual policy or your agent for details regarding terms, conditions, coverage, exclusions, products, services and programs which may be available to you. Your eligibility for particular products and services is subject to the final determination of underwriting qualifications and acceptance by the insurance underwriting company providing such products or services.
This video does not make any representations that coverage does or does not exist for any particular claim or loss, or type of claim or loss, under any policy. Whether coverage exists or does not exist for any particular claim or loss under any policy depends on the facts and circumstances involved in the claim or loss and all applicable policy wording.