Indexed Universal Life (IUL) in North Carolina
Market Growth Potential Without the Risk Grow cash value tax-deferred with S&P 500 gains—but never lose money when markets drop.
GROWTH POTENTIAL WITH A SAFETY NET
The Best of ALL Worlds
IUL combines market-linked growth with permanent life insurance:
Upside Potential: Cash value credits based on S&P 500 performance (up to a cap).
Downside Protection: 0% floor guarantees no losses in market crashes.
Is Level Term Right for You?
- Investors who want market gains without risk
- High earners seeking tax-advantaged retirement income
- Business owners needing flexible estate liquidity
Real-World NC Example
A Charlotte tech exec’s IUL earned 7% annual credits during market growth years, while staying flat during downturns—building $150K+ in cash value by age 55.
Whole Life vs. UL vs. IUL: A Quick Comparison
Match your primary goal to the right type of policy.
| Whole Life | Universal Life (UL) | Indexed Universal (IUL) |
|---|---|---|
| Safety & Guarantees | Flexibility | Growth Potential |
| Fixed & Guaranteed | Flexible / Adjustable | Flexible / Adjustable |
| Guaranteed Rate + Dividends | Based on Current Interest Rates | Linked to Market Index (S&P 500) |
| Lowest | Low to Moderate | Moderate (with 0% Floor) |
IUL: The Power of Indexed Growth
The engine of an IUL is its powerful and flexible crediting strategy. Instead of a fixed interest rate, your gains are based on the annual performance of a market index, like the S&P 500. This allows you to participate in the market’s good years and potentially see significant cash value accumulation.
This is where IUL truly shines. You get the best of both worlds: 1. The Safety Net: A guaranteed 0% floor means your cash value never loses money due to market downturns. 2. The Growth Potential: While some strategies have a “cap rate” on gains, we partner with top carriers offering uncapped index options. This gives you the potential to capture even more of the market’s upside, creating a powerful tool for building a tax-advantaged asset for your family’s future.
IUL by the Numbers
0% Floor Guarantee
Your cash value is 100% protected from market downturns. If the S&P 500 has a negative year, you simply receive a 0% credit, ensuring your principal is never at risk from direct market losses.
Crediting Strategy
Your growth is linked to a market index. While many policies have a "cap rate" limiting gains, we partner with top carriers that also offer uncapped index options, allowing you to capture more of the market's upside potential.
Tax-Advantaged Income
As explained by financial authorities like Kiplinger, the cash value in an IUL can be accessed via policy loans to create a tax-free income stream in retirement.
NC Regulation
IUL policies are classified as life insurance, not securities, and are regulated by the N.C. Department of Insurance. This provides a layer of consumer protection.
IUL in North Carolina: Your Questions Answered
If it's tied to the S&P 500, am I investing in the stock market?
No, and this is a critical distinction. An IUL is a life insurance policy, not a direct investment. You do not own any stocks or shares. The insurance carrier uses the index’s performance merely as a benchmark to determine the interest credited to your cash value.
What are the "cap rate" and "floor rate" I keep hearing about?
These are the key risk-management features of an IUL.
The Floor: This is your safety net, typically guaranteed at 0%. It means even if the market index loses 20% in a year, your cash value does not lose any money due to that market performance.
The Cap: This is the maximum interest rate your policy can be credited in a given year. If the index gains 15% but your policy has a 10% cap, your cash value would be credited with 10%. This is the trade-off for having the 0% floor protection.`
How does the cash value create a "tax-free" retirement income?
This is one of the most powerful features of permanent life insurance. You do not withdraw the cash value directly. Instead, you take out policy loans against your cash value. Loans taken from a life insurance policy are generally not considered taxable income. This allows you to create a tax-free income stream in retirement to supplement your 401(k) or Social Security.
s IUL better than a 401(k) or Roth IRA?
It’s different, not necessarily better. An IUL should be considered a **supplement** to traditional retirement accounts, not a replacement. Its unique advantages are the tax-free death benefit, the 0% floor protecting you from market loss, and the ability to create tax-free income via loans. It’s a powerful addition to a diversified financial strategy.
Is this product regulated in North Carolina?
Absolutely. Indexed Universal Life is classified as a fixed life insurance product and is therefore regulated at the state level. In North Carolina, all IUL products, illustrations, and sales practices fall under the oversight of the N.C. Department of Insurance, which ensures that consumer protection standards and fair practices are upheld.
Ready for Growth Without the Risk?
Secure Your Rate
You’ve done the research. Lock in your affordable Permanent Life rate today and get the peace of mind your family deserves.
Explore Other Options
This is a fantastic choice, but not the only one. Compare it against other policies to ensure you’ve found the perfect fit.