top of page
Universal and Index Universal
In universal life insurance, the cash value grows at a fixed interest rate set by the insurance company. The rate is typically
guaranteed not to fall below a certain level In indexed universal life insurance, the cash value growth is tied to the performance of an underlying financial index, such as the 500. The policyholder's cash value can potentially grow at a higher rate if the index performs well, but there is usually a cap on the growth rate to protect against market downturns.
Risk Vs. Reward of Universal and Index Universal
Universal life insurance provides a guaranteed minimum interest rate on the cash value, offering stability but potentially lower growth
compared to indexed universal life insurance.
Indexed universal life insurance offers the potential for higher returns based on the performance of the chosen index, but it also
comes with the risk of lower returns in down markets or if the index does not perform well
Embed video
Premium Flexibility:
Both types of policies typically offer flexibility in premium payments. Policyholders can adjust the premium amount and frequency
within certain limits, allowing them to adapt to changes in their financial situation
In summary, the main difference between universal life and indexed universal life insurance lies in how the cash value grows:
universal life offers a fixed interest rate, while indexed universal life ties cash value growth to the performance of an underlying index.
Each type of policy has its own advantages and considerations, and the best choice depends on the individual's financial goals, risk tolerance, and overall financial situation
Talk to us for a free consultation and policy review, let us help you plan the right insurance for you book your free appointment here.
bottom of page