Indexed universal life insurance (IUL) is a permanent life insurance policy that provides a death benefit and a cash value component. The cash value is tied to a market index, allowing for potential growth.
IUL offers flexibility in premium payments, death benefits and investment options. The policy's cash value grows tax-deferred, and you can access it through loans or withdrawals. The cash value links to a market index, letting you participate in market gains without directly investing in the stock market.
Cash value is the investment portion of your life insurance policy that accumulates over time. Unlike term life insurance, which only provides a death benefit, permanent life insurance policies like IUL build cash value you can borrow against or withdraw during your lifetime.