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Depending on who you ask, indexed universal life (IUL) insurance is either a powerful wealth-building strategy or an overly complicated insurance product that promises more than it delivers. However, the truth could lie somewhere in the middle.
An IUL is first and foremost a life insurance policy. Like other permanent life insurance products, it can provide lifelong coverage and build cash value over time. But what makes it different is how that cash value grows. Instead of earning a fixed interest rate, it's tied to the performance of a stock market index, such as the S&P 500.
Here's how indexed universal life insurance works, who it may be a good fit for, and what to know before buying a policy.
Indexed universal life insurance is a type of permanent life insurance that combines a death benefit with a cash value account. As long as the policy stays in force, your beneficiaries receive a death benefit when you die, and part of the premiums you pay has the potential to grow inside the policy over time.

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