Jeff is a well-known speaker and expert in life insurance and financial planning. He has been featured and quoted in Nerdwallet, Bloomberg, Forbes, U.S. News & Money, USA Today, and other leading finance websites. He is a licensed life insurance agent and has helped over 3000 people secure life insurance. He is licensed in all 50 states & DC. Jeff has spoken at top insurance conferen...

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Benjamin Carr was a licensed insurance agent in Georgia and has two years' experience in life, health, property and casualty coverage. He has worked with State Farm and other risk management firms. He is also a strategic writer and editor with a background in branding, marketing, and quality assurance. He has been in military newsrooms — literally on the frontline of journalism.

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Reviewed by Benji Carr
Former Licensed Life Insurance Agent Benji Carr

UPDATED: Oct 14, 2020

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If you are looking for a life insurance coverage package with extremely flexible, controllable and adjustable options, then enrolling in an indexed universal life insurance policy may the right life insurance option for you.

An indexed universal life insurance policy merges the standard options of a life insurance policy and death benefits with and an equity and stock market linkable index account.

An indexed universal life insurance policy also accrues increasable cash value. Cash value and equivalent worth that can be leveraged against for a loan.

The policy is guaranteed to maintain a zero-point credit rating or as minimum as possible, dependent upon policy plan and the insurance company.

Most people choose to enroll in an indexed universal life insurance policy to take advantage of and make the most out of its flexible and consumer controllable policy options and stock market-interfacing abilities.

Get in touch with one of our representatives today so that we guide you in your search for the right policy today.

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Indexed Universal Life Insurance Fundamentals

Indexed universal life insurance is also known as equity indexed universal life insurance.

It was designed to appeal to people who want to augment their retirement savings as well as positively manipulate their policy’s cash value growth potential.

In many ways, an indexed universal life insurance policy features a lot of the same coverage policies, benefits and actionable options available in a standard whole life insurance policy. But with more adjustable and controllable policy options.

  • Just like a whole life insurance policy, you are guaranteed coverage for the duration of your life as long as you pay the premium. After death, a regularly scheduled death benefit payment will be paid out to all allocated beneficiaries of the insured.
  • You can control how much you actually pay in premiums. You can decrease or increase death benefit payments according to the needs of your policy.
  • You can keep future death benefit payments amounts level or allow for incremental increases per subsequent death benefit payment.
  • The cash value worth that your indexed universal life insurance policy accrues is all taxation deferred. The cash value worth of the policy becomes taxation free when it is officially withdrawn from the policy.
  • The eventual accumulated and accrued cash value worth of the policy coverage can be withdrawn taxation-free via personal or business loans leveraged against the policy.
  • Indexed universal life insurance coverage policies are performance linked to current stock market indexes. Your insurance company may invest a percentage of your policy’s cash value worth in the market, most likely equity in the securities or mortgage markets.
  • The cash value worth of the totality of your indexed universal life insurance policy will have credit and an interest rate based on the of the stock market and index performance linked to the policy.
  • If stock market indexes perform well, then then the overall cash value worth of the policy increases. If stock market indexes struggle, then at least the policy is guaranteed to maintain a level interest rating.
  • This policy guarantees a minimum zero percent interest rate. Everyone’s circumstances are unique, so be forewarned that your interest rate will be dictated by the particulars of your policy and the status of financial stock market.
  • Insured policy owners never have to pay into or add additional money into the policy for the sake of stock market indexes. Your premium will never be used in any stock, bond, securities or investment strategies. The nature of the coverage allows for such actions using dedicated policy funds.
  • A percentage of your premium can be allocated or re-routed to what called an index account or index selection in preparation of stock market performance. This vicarious investment of premium is a legal and is not considered an actual investment of the premium. Technically and literally, the premium is never viewed as being used as an investment in the stock market or any index standing.
  • Your enrollment in an indexed universal life insurance policy offers you financial cover and protection from underperforming stock market showing because there is no direct 1st person investment.
  • As the policy owner you will be able to track the stock market linked performance of your premium re-routed index selection via an index segment or what is also colloquially known in the insurance industry as a “bucket.”
  • You can then performance gauge each index bucket through a fiscal period of time called an Index period. Through each index period you can assess the financial performance, fluctuations and changes of your index bucket and policy portfolio.
  • Indexed universal life insurance products and policy packages offer a variety of options that allow you to make the most out of the flexible and financially adjustable nature of the policy. Let’s check out a few such available policy features.

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Supplemental Income Option

Indexed universal life insurance policy monies have the option of being allocated for future use as supplemental income. Policy withdrawals or re-allocation of premium, dividends or cash value worth of the overall policy can be re-directed or pooled for such purposes.

Accelerated Death Benefits Option

This is an available policy option on most indexed universal life insurance plans that many consumers may not be familiar with. In the event that the insured policy owner has weeks left to live and can verify such by medical evaluation, then death benefit payments can start being paid out to allocated beneficiaries.

This option is not automatic and is activation dependent upon multiple conditions. A licensed medical physician and thorough medical evaluation must prove that the insured has less than a month to live. An insurance company representative will most likely be directed to verify all claims.

Contemplating one’s own mortality is a difficult subject to face for many people. But enrolling in an indexed universal life insurance program gives you the flexibility and controllability to adequately prepare for such an event.

Concluding Thoughts

The options of a life insurance policy do not always have to be set in stone. If you desire a whole life insurance policy that allows for maximum coverage controllably and flexibility, then get in touch with us today so we can aid you in getting an indexed universal life insurance policy.