The main difference between Index Universal Life (IUL) and Term Life insurance lies in their duration and cash value component. IUL offers lifelong coverage and the potential to accumulate cash value, accessible through loans or withdrawals for various financial needs. Its growth is linked to stock market performance, offering the potential for higher returns but also some market return risk.
Term Life covers a specific time frame, typically from 5 years to 50 years. It doesn't build cash value but is more affordable, making it an attractive option for those seeking solely death benefit protection within a defined timeframe.
Key Comparison of IUL vs. Term Life Insurance
Coverage Duration: When comparing IUL with Term Life Insurance, it's clear that Term Life provides temporary coverage, while IUL offers lifelong protection.
Cash Value: Based on our use of these products for our high net worth clients, IUL has the potential to accumulate cash value, while Term Life does not.
Cost: Our team consistently finds through using these insurance products that Term Life generally has more affordable premiums than Index Universal Life insurance in most cases
Flexibility: Unlike term life insurance, IUL offers premium payments and flexibility in death benefit adjustments.
Capital for Life Recommends
Term Life Insurance is for those seeking affordable, temporary coverage for specific needs, such as a home loan, covering a child's education, or protecting business owners.
Index Universal Life Insurance is for individuals who value life long protection, potential cash value growth for future lifetime needs, and the flexibility to adapt their policy as their life changes.
Suitability: If you're looking for a life insurance product that delivers affordable, temporary coverage, Term Life is the clear choice. If you're looking for a life insurance product that prioritises lifelong protection, potential cash value growth, and flexibility, IUL is recommended by Capital for Life.
Capital For Life ©2024 All Rights Reserved.
