What Is Indexed Universal Life Insurance Policy?
37376 POINTSview profileDavid G. Pipes, CLU®, RICP®Business Development Officer, T.D. McNeil Insurance Services, Fresno, CaliforniaThe cash value of any whole life policy earns interest. The amount of interest is contractual in a whole life policy. That interest rate reflects the company’s anticipated earnings. An indexed universal life looks to an established external index to determine the interest rate. This could be the Dow Jones Average, Standard and Poor’s or several others. These indexes then provide the insurance company with the interest that they are to apply to the policy. The interest rate isn’t guaranteed, although some policies will not charge negative interest if the index dips below zero.Answered on September 23, 2014flag this answer.JPG)
63333 POINTSview profilePeggy MaceMost of the U.S.An Indexed Universal Life Insurance policy gives you the chance to have part of your life insurance premium allocated to a fixed account or an equity indexed account(s). While the return may not be as high as with a variable product, you are protected from returns less than zero.Answered on September 25, 2014flag this answer
21750 POINTSview profileJim WinklerCEO/Owner, Winkler Financial Group, Houston, TexasThat is an excellent question! An indexed UL policy is a type of permanent life insurance. This type of policy carries a higher amount of risk than a traditional whole life policy. In a traditional policy, your death benefit is guaranteed, and your premium payments are usually set, and unchanging. In the indexed policy, the death benefit is created by an interest rate that is tied to an outside index, usually the Dow, or the S&P 500. As the market moves, so does the interest rate that your policy earns. The rates are usually capped on the high side, and may or may not have floors on the bottom end. This means that your policy may or may not increase in cash value, and your premiums may or may not have to increase to keep the policy active and in force. This type of policy has a lot of moving parts, and is , in my opinion, left for those with higher risk tolerances, good liquidity, and the understanding of, and time to follow, the markets. I rarely recommend this product. I hope that helps, thanks for asking!Answered on September 27, 2014flag this answer
11783 POINTSContact Meview profileLarry GilmorePROAgent Owner, Gilmore Insurance Services, Marysville, Washington StateWhat is an indexed universal life insurance policy? An indexed universal life policy is a form of permanent life insurance with some variable features that allow you as the insured, the ability to mix the investment side of the plan into your "own" investment plan. In other words you pick from the investment choices allocate as you see fit and you may or may not be as successful as the professionals who would normally do the investing.Answered on October 16, 2015+01+1 this answer
0flag this answerview more answers by Larry Gilmore
Did you find these answers helpful?
Yes
No
Go!
Add Your Answer To This Question
You must be logged in to add your answer.
