Loading the player...

What is '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.

BREAKING DOWN '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.

RELATED TERMS
  1. Group Universal Life Policy (GULP)

    A group universal life policy is universal life insurance offered ...
  2. Cash Value Life Insurance

    Cash value life insurance is permanent life insurance with a ...
  3. Needs Approach

    Needs approach is a method of calculating how much life insurance ...
  4. Convertible Insurance

    Convertible insurance allows a policyholder to change a term ...
  5. Unbundled Life Insurance Policy

    An unbundled life insurance policy is a type of financial protection ...
  6. Add To Cash Value Option

    An add to cash value option is a life insurance policyholder's ...
Related Articles
  1. Financial Advisor

    Index universal life versus whole life insurance: A comparison

    Consumers have choices when it comes to life insurance. Knowing your future needs for cash or retirement can make the difference in what you select.
  2. Retirement

    Beware the Sneaky Math of Universal Life Insurance

    Universal life insurance's cash value can be a cash cow – if there's any left. Read on to see if it'll work as an income source after you've retired.
  3. Insurance

    Life Insurance: Foundation to a Solid Portfolio

    Life insurance should be a foundation of an overall financial portfolio. Here's why.
  4. Financial Advisor

    Getting Life Insurance in Your 20s Pays Off

    Find out how Americans in their 20s can benefit from a well-thought-out life insurance policy, especially if they are able to build cash value for retirement.
  5. Financial Advisor

    Permanent life policies: Whole versus universal

    If you're looking for life-long security, choosing between these whole and universal life policies is a key decision.
  6. Insurance

    How Cash Value Builds in a Life Insurance Policy

    If you have permanent life insurance, more of your insurance premium goes to cash value in the early years of your policy.
  7. Insurance

    Choosing Between Whole and Term Life Insurance

    For most people, term life insurance is more suitable than whole life insurance. Here's why.
  8. Insurance

    What Is the Best Age to Get Life Insurance?

    Learn about the optimal time for purchasing personal life insurance and why delaying the buying decision may have costly consequences.
  9. Insurance

    How Life Insurance Can Provide Retirement Income

    Universal life insurance can generate tax-free retirement income. Here's how.
RELATED FAQS
  1. What is the difference between term and universal life insurance?

    Term life insurance is the most basic of insurance policies. Universal life insurance falls under a broader category of policies ... Read Answer >>
Hot Definitions
  1. Futures Contract

    An agreement to buy or sell the underlying commodity or asset at a specific price at a future date.
  2. Yield Curve

    A yield curve is a line that plots the interest rates, at a set point in time, of bonds having equal credit quality, but ...
  3. Portfolio

    A portfolio is a grouping of financial assets such as stocks, bonds and cash equivalents, also their mutual, exchange-traded ...
  4. Gross Profit

    Gross profit is the profit a company makes after deducting the costs of making and selling its products, or the costs of ...
  5. Diversification

    Diversification is the strategy of investing in a variety of securities in order to lower the risk involved with putting ...
  6. Intrinsic Value

    Intrinsic value is the perceived or calculated value of a company, including tangible and intangible factors, and may differ ...
Trading Center