Insurance, not direct market ownership
Indexed universal life is permanent life insurance. A cash-value crediting strategy can be tied in part to the performance of an external index, but the policy does not directly invest your cash value in the stock market.
Understand what changes the outcome
Caps, floors, participation rates, spreads and policy charges influence outcomes. Crediting terms may change within contractual limits. A floor on credited interest does not prevent charges, loans or withdrawals from reducing cash value.
Review funding over time
Premium flexibility does not eliminate the need to maintain adequate funding. Request illustrations that distinguish guaranteed from non-guaranteed values, and review in-force performance regularly. Inadequate funding can lead to lapse and potential tax consequences.
Further reading
For educational purposes only. Products and strategies vary by individual circumstances. Consult qualified legal and tax professionals where appropriate.
Back to all perspectives