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Indexed Universal Life
Most people buy either whole life insurance or term life insurance. But, there is another option. Universal life insurance plans are similar to whole life insurance plans, except they have additional benefits that can be relied on by policyholders. Indexed Universal Life (IUL) plans have additional benefits that allow you to build wealth through your life insurance policy.
To learn more about Indexed Universal Life plans, continue reading.
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What Is Indexed Universal Life?
Indexed Universal Life plans are typically pitched as permanent coverage that has cash value. The plans also benefit from market gains in a tax-free way. Your policy includes a death benefit and also a cash value component that earns interest based on the performance of an underlying stock index. As the index associated with the plan moves up or down, so does the rate of return on your plan’s cash value.
IUL Plan Returns
The rate of return on your IUL policy will determine how much value it accrues of the course of your life. Some plans offer a minimum guaranteed rate of return, others also offer an upper limit on returns. These plans are riskier than fixed universal life plans, but they are less risky than variable universal life insurance plans. To compare all three types of universal coverage, speak to an insurance agent today. IUL plans also accrue tax-free capital gains, as long as the policyholder doesn’t abandon the policy before it matures.
Benefits of IUL Plans
The primary benefit of IUL plans is that they have a high potential for accruing returns. These plans leverage call options to upside exposure to build equity in indexes without significant risk of losses. This is unlike other life insurance plans that only offer a small interest rate that isn’t even always guaranteed. Though, you should remember that the rate of return for your IUL plan can go up or down depending on how well the underlying index performs.
Another benefit is that these plans are flexible enough to allow policyholders to meet their investment goals while also keeping their loved ones financially protected. The plans are also customizable, as people can decide how much risk they want to take in the market and adjust their death benefits as needed. There are also many riders that can make coverage far more reliable.
Shop For IUL Plans
If you are curious about what else IUL plans can offer policyholders, it’s time for you to speak to an insurance professional. The talented agents at Insured For Life are ready for your call. You can speak to us now to start collecting quotes on IUL plans in your area.
