VARIABLE UNIVERSAL LIFE INSURANCE
Variable Universal Life insurance is a permanent universal policy. Unlike all other permanent life insurance policies, the insured can allocate premium dollars into separate sub-accounts which may include stocks, bonds, bond funds, equity funds, and money market funds.
The performance of the product is tied to the investment choices, which means the policy owner bears more risk in this insurance product than in others but can also enjoy greater rewards if the sub-accounts perform positively. If the sub-accounts decline, cash value can be lost and could result in the need for additional premiums to keep the policy in force. If the sub-accounts grow, cash values will grow on a tax-deferred basis which can allow for future flexibility.
In general, Variable Universal Life insurance is well-suited for:
Those wanting unlimited upside potential and who can handle the downside of investment risks.
Those interested in Variable Universal Life should be willing to accept the responsibility for managing their policy values and making investment decisions.
Those who will add additional premium to the policy because most Variable Universal Life policies will perform best when the premiums paid into the policies are closer to the maximum allowable premiums.