What is variable universal life insurance?

Friday, September 01, 2023 05:00 AM - Comment(s)

What is variable universal life insurance?

Variable universal life insurance is a type of permanent protection that offers flexibility and the potential for growth by investing some or all of your cash value in subaccounts that are tied to the stock market — similar to how mutual funds are structured.

What does it offer?

In addition to lifetime protection, variable universal life insurance offers a unique combination of benefits to help meet your needs, including:

Enhanced growth potential

A variety of high-quality investment options mean the potential to earn a higher-than-average rate on your cash value accumulation.

Supplemental retirement income

If you’re already making the maximum allowable contributions to your qualified retirement funds, a variable universal life policy offers you the potential to build additional savings for retirement.

Tax advantages

All life insurance products offer tax advantages, including a tax-free death benefit and tax-deferred cash value growth to help you make the most of your investment.

Policy customization

You can customize a variable universal life policy with a variety of optional features for an additional charge, including the Long-term Care Rider.

How does variable universal life insurance work?

A portion of your flexible premium payment goes toward the insurance, which includes any fees and death benefit coverage.

The remaining premium goes into a tax-deferred savings account, with the opportunity to invest that cash value into subaccounts.

Who may benefit from variable universal life insurance?

Variable universal life insurance is designed for people who:

Are looking for a permanent life insurance policy that has the potential to accumulate cash value
Want more variety and control over their investment options
Prefer the freedom to monitor and make decisions on where to allocate their funds over time
Understands that investing involves rewards, but also risks that may have the potential to reduce the policy’s cash value.

Could variable universal life insurance be right for you?

See how it compares to other types of life insurance (e.g., variable universal life vs. whole life) to get a better idea of whether it meets your needs.

Individuals and businesses who would like to connect with Annuity Pros can get in touch instantly via our enquiry form.

Annuity Products

Life Insurance Products

Get Started Now