Choosing the best IUL company for your personal situation is essential to ensure that your Indexed Universal Life (IUL) policy delivers long-term value. With numerous IUL companies available, picking the right policy can be challenging. In this guide, we’ll explore the key features to look for in the best IUL policies and walk you through the process of how to open an IUL account. Whether you’re aiming to build cash value or secure tax-free retirement income, understanding these steps will help you make informed decisions.
Our clients open an IUL account to build up cash value, which they then use as supplemental tax-free retirement income. To better understand how much tax-free income an IUL can generate, use our IUL calculator.
Best IUL Companies for Cash Accumulation (Top 5)
Our top 5 best IUL companies for cash accumulation are listed below. Others are worth noting. However, these five excel in cash accumulation and tax-free income distribution. When deciding which companies make the list, we look for:
- Company Ratings
- Comdex ratings
- Unique IUL account Features
- Policy Loan Flexibility
- 20-year and 40-year costs
- Index Allocation options
- IUL account Dealbreakers
Allianz Life IUL Policy
Allianz Life is a premier choice and has one of the best IUL accounts, particularly for tax-free retirement planning. The Allianz flagship IUL policy is the Accumulator IUL and was released for purchase in July 2024. Allianz Life is one of the best IUL companies to choose from.
Key Benefits of the Allianz Life Accumulator IUL Policy
- Protection and Growth: The Allianz Life Accumulator IUL offers a tax-free death benefit to protect your loved ones while providing the potential for significant cash value accumulation. The policy’s cash value can grow based on the performance of selected market indexes, all while being protected from market downturns.
- Index Lock Feature: One of the unique features of this policy is the Index Lock. This allows you to lock in an index value during the crediting period, ensuring that you capture gains and avoid zero-interest credits. This feature also includes an Auto Lock option, which automatically triggers the lock when your pre-set targets are met, adding an extra layer of control over your policy’s performance.
- Flexible Access to Cash Value: The policy offers flexible options for accessing your accumulated cash value through loans and withdrawals. These funds can be used for any purpose, such as supplementing retirement income, paying for college tuition, or handling unexpected expenses. The policy offers both indexed and fixed loans with competitive rates to suit different needs.
- Interest Bonuses: The Allianz Life Accumulator IUL includes multiple interest bonus opportunities to enhance cash value growth. Depending on the allocation options selected, these bonuses can provide a flat rate or a multiplier on any earned indexed interest, helping to accelerate the growth of your policy’s cash value.
- Customization with Riders: The policy is highly customizable, offering a range of optional riders, including those that provide benefits for chronic or terminal illness, premium waivers in case of disability, and additional term insurance. These riders allow you to tailor the policy to better meet your specific financial and protection needs.
- Stability and Reliability: Backed by Allianz Life Insurance Company of North America, the policy is supported by a company with a long history and strong financial ratings, ensuring that your policy is both stable and reliable.
What we like about Allianz:
- Allianz Accumulator IUL has a unique rate lock feature. Rate lock gives the policy owner the ability to lock in its index value at any point of the year if they are happy with the current return. Once locked in, there is no worry about how the index performs for the rest of the year.
- Index allocations include the normal S&P 500 index, Bloomberg US Dynamic Balance, Pimpco Tactical Balanced, and a Blended index. In total, there are 15 indexed and one fixed allocation spread your premium into
- Loan options include an indexed policy loan with a guaranteed 5% rate and a fixed loan option.
- Great advanced planning department for assistance with business and estate planning like Executive Bonus, Split Dollar, Buy-sell agreements, and key employee strategies.
What we don’t like:
- No term policies. Although Allianz doesn’t offer a stand-alone term life policy, a term rider can be added to Allianz Accumulator IUL to help offset some of the upfront costs in the policy.
Allianz’s commitment to financial strength and stability reassures policyholders of the company’s ability to meet long-term obligations.
North American IUL
North American is highly regarded for its competitive pricing and strong performance, especially in IUL policies. Their focus on long-term cash value accumulation is a significant advantage for savers seeking tax-free income solutions. The flagship IUL policy for retirement income planning is the Builder Plus IUL 4. You can purchase an IUL policy from North American beginning August 2024.
Key Benefits of the Builder Plus IUL 4 Policy
- Strong Death Benefit Protection: The Builder Plus IUL 4 offers robust death benefit protection, ensuring your loved ones are financially secure in the event of your passing.
- Long-Term Cash Value Growth: This policy is designed for significant long-term cash value accumulation, making it an excellent choice for those looking to build wealth over time. The policy includes various interest bonuses that help increase cash value, even when funds are being loaned.
- Flexibility with Loans and Withdrawals: The policy allows for both fixed and variable interest participating policy loans starting from year three. These loans provide financial flexibility without sacrificing the growth of your cash value.
- Enhanced Supplemental Retirement Income: Builder Plus IUL 4 is tailored to help supplement your retirement income while reducing the effects of market volatility and taxes. This feature makes it a valuable tool for long-term financial planning.
- Accelerated Death Benefit Endorsements (ADBE): The policy includes accelerated death benefit endorsements for critical, chronic, and terminal illnesses at no additional cost. This allows you to access a portion of the death benefit if you’re diagnosed with a qualifying illness, providing financial support when it’s needed most.
- Interest Rate Bonuses: Builder Plus IUL 4 offers several interest bonuses depending on the duration the policy has been in force, enhancing the policy’s cash value over time.
- Stability and Financial Strength: North American, with over 135 years of experience, brings stability and reliability to your investment, backed by strong financial ratings.
- Modernized and Simplified Process: The policy features modernized business processes, including online applications and enhanced digital tools, making it easier to manage and maintain.
Why is North American one of the best IUL companies?
- Term policies that are convertible to any of the IUL policy options available.
- 3 loan options available. Fixed participating loans, variable loans, and standard policy loans.
- The current market focus is family planning and business planning. Advanced planning now includes split dollar plans, executive bonus, buy-sell agreements, and REBA (restricted executive bonus arrangements)
- North American has a unique employee-owned company structure.
What we don’t like:
- No premium financing availability.
- Renewal rate history
With a strong track record of financial stability, the company is a solid choice for those prioritizing consistent growth and reliability in their retirement planning.
Lincoln Financial IUL
Lincoln Financial stands out in the IUL landscape with its diverse product offerings that cater to a wide range of retirement needs and preferences. Lincoln has several IUL policies available, but we like the Wealth Accumulate 2.
Key Benefits of the Lincoln WealthAccumulate® 2 IUL Policy
- Flexible Growth Opportunities: The Lincoln WealthAccumulate® 2 IUL allows you to choose from six different indexed accounts, linked to the S&P 500® Index and the Fidelity AIM® Dividend Index. These accounts offer a balance of growth potential and downside protection, allowing your cash value to grow while being safeguarded against market losses.
- Guaranteed Interest Bonuses: The policy includes multiple interest bonuses that enhance cash value growth. For example, the Account Value Enhancement (AVE) provides a guaranteed minimum interest rate of 0.25% annually on certain accounts, helping your policy grow consistently.
- Customizable Death Benefit Options: The policy offers three death benefit options—level, increasing by cash value, and increasing by premium. This flexibility allows you to tailor the policy to meet your specific financial needs and goals, ensuring that your beneficiaries receive the most appropriate level of protection.
- Loans and Withdrawals: The policy provides access to your cash value through indexed and fixed loans, with guaranteed loan interest rates. These loans allow you to borrow against your policy while still earning interest on the funds, providing flexibility in managing your finances without compromising the policy’s value.
- 10-Year No-Lapse Guarantee: This feature ensures that your policy will remain in force for at least 10 years, even if the cash surrender value is insufficient to cover the monthly deductions, as long as the cumulative premium requirement is met. This provides peace of mind, knowing your coverage is secure for a decade.
- Comprehensive Coverage and Stability: Backed by Lincoln Financial Group, a company with a strong reputation and financial stability, the Lincoln WealthAccumulate® 2 IUL offers reliable and long-term protection, making it a dependable choice for your life insurance needs.
What we like about Lincoln:
- Strong in advanced planning such as Split-dollar, executive bonus, and key person funding.
- Many index allocations from S&P 500 to Fidelity AIM.
- A go to company for premium financing
- Offers both fixed and variable loan options
What we don’t like:
- Only quarterly or annual sweep to index accounts
- Term conversion options are limited after 5 years
Lincoln’s commitment to financial strength further adds to its appeal as a dependable provider for retirement income planning. Lincoln makes our list of top IUL companies.
Ameritas IUL
Ameritas distinguishes itself in the IUL market through its flexible premium options and innovative policy features. Ameritas has one IUL account offering called the Ameritas FLX and is one of the best IUL companies to choose from.
Key Benefits of the Ameritas FLX IUL Policy
- Flexible Indexing Options: The Ameritas FLX IUL offers five distinct index options, including popular indices like the S&P 500® and Russell 2000®. These options allow policyholders to choose how their cash value is allocated, offering a balance of growth potential and protection against market downturns with a 0% floor.
- Account Value Bonus: Starting in year 11, the policy provides an account value bonus of 0.50% (current) and 0.25% (guaranteed). This bonus applies to the entire account value, including amounts allocated to both indexed and fixed accounts, which can help boost cash value accumulation over time.
- Lifetime Income Rider: The FLX IUL includes an optional Lifetime Income Rider, which allows policyholders to receive guaranteed income for life. This rider can be activated between ages 50 and 85, providing financial security during retirement without the need for additional premiums once activated.
- Loan and Withdrawal Flexibility: The policy allows for both fixed and variable loans, offering flexibility in how policyholders can access their cash value. Fixed loans offer a stable interest rate, while variable loans allow the borrowed amount to remain in indexed accounts, potentially earning interest even while the loan is outstanding.
- Living Benefits: The Accelerated Death Benefit Rider offers early access to a portion of the death benefit in case of a qualifying critical, chronic, or terminal illness. This feature provides financial support during difficult times, ensuring that policyholders have access to needed funds when facing serious health challenges.
- No-Lapse Guarantee: The policy includes a 15-year no-lapse guarantee, ensuring that the policy remains in force even if the cash surrender value is insufficient to cover monthly deductions, provided that the minimum premium is paid.
- Customization and Additional Riders: The FLX IUL policy offers a variety of optional riders, including accidental death benefit, children’s insurance, and waiver of specified premium. These riders allow policyholders to tailor the policy to better meet their specific needs and circumstances.
What we like about Ameritas:
- The small policy face amount of $50,000 makes it suitable for lower premium commitments.
- Lifetime income rider guarantees income
- Strong living benefits for chronic and critical illness
What we don’t like:
- Expense charges are high at older ages
- 7% premium charge is high
- Rate classes are confusing
Ameritas company’s focus on personalized solutions and policyholder satisfaction makes it an attractive choice for those seeking to add IUL to their financial strategy.
National Life Group IUL
National Life Group has earned its place among one of the best IUL plans by prioritizing policyholder benefits and exceptional customer service. Their flagship product is the SummitLife IUL. SummitLife is for higher net-worth consumers in need of at least $1,000,000 of life insurance coverage. This makes for higher funding limits. If lower funding limits are desired, the FlexLife IUL would be used as their minimum death benefit is only $50,000.
Key Benefits of the SummitLife IUL Policy
- Upside Potential with Downside Protection: The SummitLife IUL offers the potential for cash value growth linked to various market indices, such as the S&P 500®, while providing downside protection through a guaranteed 0% or 1% floor depending on the chosen strategy. This feature allows your investment to grow without risking losses due to market downturns.
- Lifetime Income Benefit Rider (LIBR): This rider allows policyholders to receive a guaranteed income stream for life once certain conditions are met, such as reaching the age of 60 and maintaining the policy for at least 10 years. This can provide financial stability during retirement.
- Flexible Loan Options: SummitLife provides multiple loan options, including Participating Declared, Participating Fixed, and Participating Variable loans, offering flexibility in how you can access your policy’s cash value. These options allow for continued interest crediting while borrowing against the policy.
- Interest Bonus Options: The policy includes several interest bonus options, such as the base Enhancer, Enhancer Plus, and Enhancer Max, which can further enhance the policy’s cash value accumulation. These bonuses are applied annually, beginning in the second policy year, and vary depending on the selected strategy and loan type.
- Accelerated Benefits Riders: At no additional cost, SummitLife includes Accelerated Benefits Riders for terminal, chronic, critical illness, and critical injury. These riders provide early access to a portion of the death benefit in case of serious health conditions, offering financial support when it’s needed most.
- Systematic Allocation Rider: For policyholders making large annual premium payments, the Systematic Allocation Rider helps balance interest rate fluctuations by spreading premium allocations over multiple crediting periods, ensuring a more consistent growth trajectory.
- Comprehensive Coverage and Customization: The SummitLife IUL policy is designed for affluent markets with face amounts starting at $1 million. It offers both Option A (Level) and Option B (Increasing) death benefits, with a 10-year policy protection period, ensuring long-term coverage and growth potential.
What we like about National Life Group:
- Strong ratings and Brand Recognition
- Strong living benefits
- Lifetime income benefit rider
What we don’t like:
- Bonus is not guaranteed
- Bonus is not paid on loans
- Must keep 1 year of expenses in fixed account
The company’s financial stability and dedication to delivering value to its policyholders make it a trustworthy and effective choice for securing a tax-free retirement income strategy.
Which IUL Companies are best for you?
In addition to the death benefit, a great reason to own Indexed universal life insurance is for the potential tax-free income that can be generated during retirement. Which are the best IUL life insurance companies? This is a very important question since these purchases are very long-term and need to perform well to reap the most benefit. Certainly, it makes good sense to find the top-rated life insurance companies because they will live up to their promises.
We offer indexed universal life from many of the top carriers. We can design an IUL model around your personal financial goals. Just use the IUL estimator on this page to see some numbers.
There are over 40 carriers in the indexed universal life marketplace today. Each of those carriers may have several different policies that they offer. We can only recommend a handful of these carriers, which we consider to be the best-rated life insurance companies for IUL.
How to Choose the Best IUL Policy
When selecting an indexed universal life (IUL) policy, consider these nine key factors:
Ratings: Insurance companies are evaluated annually by major rating agencies. Focus on AM Best and Comdex ratings, aiming for companies with top scores—A+ for AM Best and 80-100 for Comdex.
Index Caps: Higher caps mean more earning potential. The S&P 500 index cap averages around 10%. Choose a carrier with a history of stable caps and a variety of index options, including uncapped ones.
Money Sweep Policy: Your premium should start working for you immediately. Daily or monthly sweeps ensure your money is allocated to the indexing account as soon as it’s received, maximizing growth potential.
Low Policy Expenses: Over decades, expenses add up. A recent comparison showed a $50,000 difference between low and high-expense policies over 20 years. Opt for companies with lower policy costs.
Accelerated Benefits: These allow access to a portion of the death benefit in cases of chronic, critical, or terminal illness. Choose carriers with strong accelerated benefit options.
Loan Options: If using your policy as an income supplement, look for flexibility in loan types—fixed, fixed participating, and variable. Variable-rate loans allow funds to remain in the index, continuing to earn interest. Ensure your variable loan rate is capped, typically at 5-6%.
Interest Bonus: Some policies offer a bonus interest rate. Look for guaranteed bonuses that apply to all policy values, including borrowed funds.
Interest Multipliers: These can significantly boost your earnings by adding 10% to 40% based on annual index growth.
Overloan Protection: To prevent your policy from lapsing with an outstanding loan, your policy must include an overloan protection rider. This protects you from the tax consequences of a policy lapse.
| Company | Year Established | Comdex Ranking | AM Best Rating | Policy Name |
|---|---|---|---|---|
| Allianz Life | 1890 | 93 | A+ | Accumulator IUL |
| North American | 1886 | 89 | A+ | Builder Plus IUL 4 |
| Lincoln National | 1905 | 82 | A | Wealth Accumulate |
| Ameritas | 1887 | 79 | A | FLX Living Benefit |
| National Life | 1848 | 90 | A+ | Summit Life |
Compare the Best IUL Companies
We design your IUL account around 3 things. Your health, your funding amount and your timeline.
When you compare each IUL company apples to apples, it is easy to see which carrier will work the best for you.
The policy designs we build out for you will include:
- Key definitions of an IUL policy
- Living benefits included
- Ledger of cash value and tax-free income distribution amounts
- Expense reports and IRR reports
- A personalized review of the IUL illustration with one of our team
How to Open an IUL Account
Step 1: Initial Discovery Call
The first step in opening an IUL account is a discovery call to understand your financial goals. During this consultation, we’ll gather key details to create a personalized Indexed Universal Life (IUL) illustration. This illustration will outline important factors such as premiums, indexed interest, accumulation value, death benefits, and potential tax-free distributions.
Step 2: Reviewing Your IUL Illustration
Once your personalized IUL illustration is ready, we’ll schedule a detailed review session. This can be conducted via a Zoom call, where we’ll go over your illustration step by step. If you’d like to explore alternative scenarios, we can provide additional illustrations and discuss the impacts of different variables on your policy’s performance.
Step 3: Starting the IUL Application Process
When you’re confident in the details and understand how the IUL policy works, we proceed to the application process. Each insurance company has its own procedures, but we typically utilize an e-application process for efficiency. This ensures your IUL policy is opened smoothly and securely.
Why Choose Us?
With extensive experience and thousands of clients successfully guided through the process, we’re here to help you navigate the complexities of Indexed Universal Life Insurance. Let us assist you in understanding every aspect of an IUL and in opening your IUL account with confidence.
Frequently Asked Questions about IUL
We have found that the following insurance carriers best meet the needs of our clients for Indexed Universal Life insurance.
- Allianz Life Pro+
- North American Builder Plus 3
- Lincoln Wealth Accumulate 2
- Ameritas FLX IUL
- National Life Summit Life
When we compare IUL policy expenses and fees that accumulate in an IUL over several decades with traditional retirement products, the IUL falls in line with traditional investments and in some cases they are much lower.
Check these 8 items to determine which carrier works best for you.
1. Index Cap and Floor rate
2. Money Sweep Policy
3. Low policy expenses and fees
4. Accelerated Benefits for chronic, critical, and terminal illness
5. Loan Options
6. Interest Bonuses
7. Interest multipliers
8. Overloan protection
It is very important to have your premium dollars go to work for you as soon as possible. The sweep options are daily, monthly, quarterly and yearly. We prefer daily sweeps so that no matter when you send your premium your money goes to the indexing account.
