|
Dimensions
|
Indexed Universal Life
|
Traditional Universal Life
|
Traditional Life Insurance
|
|---|---|---|---|
|
Premiums
|
Flexible and adjustable
|
Flexible, can vary over time
|
Fixed, determined at policy issuance
|
|
Cash Value
|
Tied to an index tied to the stock market
|
Typically earns an interest rate that corresponds to current money market ratesVariable, non-guaranteed
|
Grows via a fixed interest rateFixed, guaranteed
|
|
Death Benefit
|
Adjustable to your needs
|
Fixed, Not guaranteed
|
Fixed, guaranteed
|
|
Investment Risk
|
Moderate, policy holder is not directly invested in the market
|
Moderate to high, dependent on the investment performance policy holder's cash value is invested in market
|
Low to moderate, insurance company invests premiums
|
|
Principal Risk
|
No
|
No
|
No
|
|
Policy Loans
|
Available
|
Available
|
Available
|
|
Tax Implications
|
Tax-deferred growth
|
Tax-deferred growth
|
Tax-deferred growth
|
|
Rate of Return
|
Variable
|
Variable
|
Low
|