Lombard Loan

A Lombard loan is a type of loan available to holders of Indexed Universal Life (IUL) policies, secured by the policy's cash value. The accumulated cash value serves as collateral for the loan, and the loan amount is typically a percentage of the cash value's total. Unlike traditional policy loans, Lombard loans often have more flexible repayment terms and may offer higher loan amounts due to the underlying collateral. This can be a valuable tool for policyholders to access liquidity for various financial needs while keeping their IUL policy in force.

Key Points:

• Collateral: The IUL policy's cash value serves as collateral for the loan.
• Loan Amount:  Determined as a percentage of the cash value, often with a higher limit than traditional policy loans.
• Flexibility: Lombard loans within IUL policies often have more flexible repayment options.
• Purpose: Provides policyholders access to cash for various financial needs without surrendering or withdrawing from the policy.