Equity indexed universal life insurance is new type of insurance that
is offered by many life insurance companies as a way to expand their
product line to better serve their customers. Because it is a rather
new type of life insurance policy, it is not well understood by many
who are shopping for life insurance.
You can take a few moments to read this article and get a quick
overview of equity indexed universal life insurance to see if it is
the type of life insurance for you and your family.
What is Equity Indexed Universal Life Insurance
Equity indexed universal life insurance is basically a combination of
traditional whole life insurance and a newer type of life insurance
called variable life insurance. Whole life insurance is a policy that
builds up value over time as you pay premiums and can be accessed at
some point or remain in effect until time for the death benefit to be
paid out.
Variable life insurance is a type of life insurance in which there is
an investment component which allows you to invest part of the policy
into various types of investment opportunities, thus allowing you to
benefit when financial markets are good.
An equity indexed universal life insurance policy is not as risky as a
variable life insurance policy because the investment is made toward
the overall movement of an index rather than specific stocks and
bonds. Also, there are generally maximums that you can make along with
minimums that you can lose unlike most variable life insurance plans.
Benefits of Equity Indexed Universal Life Insurance
The general benefit of an equity indexed universal life insurance
policy is that is combines the security and features of the
traditional whole life insurance with the potential to earn money
dependent upon the upward trend of an equity index, such as the S&P.
There are some specific benefits listed below.
• Minimized risk of loss
• Potential of policy to outrun inflation
• Proceeds transferable at death are tax free
• Tax-deferred building of cash value
• Tax managed income that can be used for retirement or college
Different life insurance companies will offer different riders,
waivers and additional options and features to their equity indexed
universal life insurance policies. The above benefits are general to
all equity indexed universal life insurance policies, but they do not
guarantee that you will not lose money on the investment component of
the policy.
It is a good idea to consult with a financial professional, other than
a life insurance agent, to help you make the decision of if and when
an equity indexed universal life insurance policy is a good value for
you.
More to Come From Equity Indexed Universal Life Insurance
Because this is such a new product, there are many innovations that
are being developed to make this a better life insurance product for
consumers. There are more and more variations available with increased
flexibility of investment to accompany the security of whole life
insurance. When searching for equity indexed universal life insurance,
make sure to ask your life insurance agent of any new innovations
offered by your life insurance company to stay on the cutting edge of
this product.
Start Getting Rate Quotes For Equity Indexed Universal Life Insurance
You can compare equity indexed universal life insurance with other
forms of whole life insurance as well as term life insurance. Cost is
always an issue, so you can use our free life insurance rate finder
tool to compare rates and policies to see which is the best value and
fit for you. It is quick and easy and can save you money on your life
insurance policy.
