Two quick, hands-on looks at Indexed Universal Life. First, how caps and floors work when the market goes up or down. Then, how a policy's numbers are laid out year by year.
An IUL credits interest based on how a market index does, with limits on both ends. Move the sliders to see how those limits change what gets credited in good years and bad years.
A real illustration shows two pictures side by side: what the carrier guarantees and what happens if the policy is credited an assumed rate. Each year it tracks the premium, the cash value, what you'd get if you surrendered, and the death benefit. Change the inputs to see how that works.
| Guaranteed (0%, max charges) | Non-guaranteed () | ||||||||
|---|---|---|---|---|---|---|---|---|---|
| Year | Age | Premium | Total paid | Cash value | Surrender value | Death benefit | Cash value | Surrender value | Death benefit |
This page is a simplified, hypothetical example for educational purposes only. It is not a policy illustration, quote, or offer, and it does not represent any specific carrier, product, or index.
Part 1: market years shown are made up and are not actual index returns. It assumes 100% participation and annual point-to-point crediting, and ignores cost of insurance, policy fees, charges, loans and taxes, which reduce cash value.
Part 2: charges shown (premium load, monthly administrative fee, cost of insurance, surrender charges) are rough estimates, not actual rates. Non-guaranteed values assume the stated crediting rate every year, which will not happen in practice. Guaranteed values show that a policy can lapse if premiums and credited interest do not cover charges.
Caps, floors and participation rates vary by carrier and product, can change, and are set by the policy. Policy loans and withdrawals reduce cash value and death benefit and may have tax consequences. An IUL is a life insurance policy, not a direct investment in the market. Coverage is subject to underwriting. Ask for a carrier-approved illustration before making any decision.