Annual Contributions

Annual Contributions in an IUL policy refer to the total amount of money a policyholder pays into the policy as premiums over a one-year period. These contributions are used to provide life insurance coverage, accumulate cash value based on the performance of a chosen index, and cover various charges and fees associated with the policy. In the context of IUL, the term emphasises the flexibility of these policies, as contributions can often be adjusted within certain limits to accommodate the policyholder's financial situation and objectives.

Note: While "contributions" is a term often associated with financial accounts like retirement accounts, in the IUL world, it underscores the investment-like aspect of these policies, where annual premium payments contribute to building cash value over time. It's essential for policyholders to manage their annual contributions effectively to optimise the growth potential and benefits of their IUL policy.