Index Universal Life

Index Universal Life Insurance (IUL) is a type of permanent life insurance that offers both a death benefit and a cash value growth component tied to a market index like the S&P 500 or NASDAQ. It’s designed to provide lifelong coverage while also building cash value that can be accessed during the policyholder’s lifetime.

✅ Flexible Premiums: Policyholders can adjust their premium payments within certain limits, giving them control over their cash flow.

✅ Indexed Growth Potential: The cash value earns interest based on the performance of a chosen stock market index, providing potential for higher returns compared to traditional whole life policies.

✅ Downside Protection: While linked to market performance, IUL policies typically have a 0% floor, meaning the cash value won’t lose money even if the index performs poorly.

✅ Tax-Advantaged Growth: The cash value grows tax-deferred, and loans taken against the policy can often be tax-free if structured properly.

✅ Death Benefit Protection: Provides a tax-free payout to beneficiaries, ensuring financial security for loved ones.

✅ Potential for higher cash value growth than traditional life insurance
✅ Protection from market losses with a 0% floor
✅ Flexible premiums and death benefit options
✅ Access to cash value for retirement, emergencies, or supplemental income

❗ Cap rates may limit upside gains during strong market performance
❗ Policy fees and costs can increase over time
❗ Requires active management to avoid lapsing due to insufficient cash value

✅ Retirement Income Planning — Cash value can supplement retirement income.
✅ Wealth Transfer & Estate Planning — Ensures tax-free legacy distribution.
✅ College Funding — Tax-free loans from cash value can help pay for education.
✅ Long-Term Care Alternative — Some IUL policies offer riders for chronic illness or LTC needs.