Equity-Indexed Universal Life Insurance

AAA

DEFINITION of 'Equity-Indexed Universal Life Insurance'

A permanent life insurance policy that allows policyholders to tie accumulation values to a stock market index. Indexed universal life insurance policies typically contain a minimum guaranteed fixed interest rate component along with the indexed account option. Indexed policies give policyholders the security of fixed universal life insurance with the growth potential of a variable policy linked to indexed returns.

INVESTOPEDIA EXPLAINS 'Equity-Indexed Universal Life Insurance'

Indexed universal life insurance differs from variable universal life insurance in that indexed policies follow a stock market index, while variable policies can allow policyholders to allocate funds to a variety of investment vehicles, such as stocks, bonds and equity funds. Indexed policies tend to be less expensive than variable policies, and offer greater security against stock market declines.

VIDEO

RELATED TERMS
  1. Free Look Period

    A period where a new insurance policy owner is able to terminate ...
  2. No-Load Life Insurance

    A type of life insurance that charges much lower fees and expenses ...
  3. Life Insurance

    A protection against the loss of income that would result if ...
  4. Whole Life Insurance Policy

    A life insurance contract with level premiums that has both an ...
  5. Variable Life Insurance Policy

    A form of permanent life insurance, Variable life insurance provides ...
  6. Permanent Life Insurance

    An umbrella term for life insurance plans that do not expire ...
Related Articles
  1. Insurance

    15 Insurance Policies You Don't Need

    Learn how to save money by saying "no" to unnecessary coverage.
  2. Insurance

    Indexed Universal Life: Cash, Flexibility And Safety

    IULs boast the security of fixed universal life policies and the interest-earning potential of variable policies.
  3. Home & Auto

    5 Insurance Policies Everyone Should Have

    Insurance policies come in a wide variety of shapes and sizes. Shop carefully and the right policies will go a long way towards helping you protect your assets.
  4. Bonds & Fixed Income

    Passing The Buck: The Hidden Costs Of Annuities

    These may look like good retirement vehicles, but beware of the fees buried in the fine print.
  5. Options & Futures

    Permanent Life Policies: Whole Vs. Universal

    If you're looking for life-long security, choosing between these two is the key.
  6. Retirement

    Vary Your Options With Variable Annuities And Insurance

    Find out how to get the customized insurance coverage you need and want.
  7. Options & Futures

    Getting the Whole Story on Variable Annuities

    Variable annuities are another way to save money tax-deferred - but don't jump in blindly!
  8. Retirement

    Variable Vs. Variable Universal Life Insurance

    Do you know why you might need one policy versus the other? Read on to find out.
  9. Home & Auto

    Long-Term Care Insurance: Who Needs It?

    No one is immune to the possibility of one day needing long-term care - and the costs can deplete a life savings.
  10. Retirement

    What is a longevity annuity?

    Understand all the characteristics of a longevity annuity contract, the purpose of a longevity annuity and what type of investor it appeals to.

You May Also Like

Hot Definitions
  1. Command Economy

    A system where the government, rather than the free market, determines what goods should be produced, how much should be ...
  2. Prospectus

    A formal legal document, which is required by and filed with the Securities and Exchange Commission, that provides details ...
  3. Treasury Bond - T-Bond

    A marketable, fixed-interest U.S. government debt security with a maturity of more than 10 years. Treasury bonds make interest ...
  4. Weight Of Ice, Snow Or Sleet Insurance

    Financial protection against damage caused to property by winter weather specifically, damage caused if a roof caves in because ...
  5. Weather Insurance

    A type of protection against a financial loss that may be incurred because of rain, snow, storms, wind, fog, undesirable ...
  6. Portfolio Turnover

    A measure of how frequently assets within a fund are bought and sold by the managers. Portfolio turnover is calculated by ...
Trading Center