Universal Life Insurance Index in the United States：IUL
1. What is IUL for universal index life insurance in the United States?
Globalization and the internationalization of asset allocation have become a trend and a hot spot for international wealth management abroad and the exploitation of global capital in recent years. As global asset allocation has boomed, financial institutions and wealth management companies abroad have become more active and active in international asset investment and management, and have become more aggressive and willing to choose international financial products.
At the same time, a very popular financial product in the United States too, in the eyes of asset configurators. Not only is the financial product red-haired in the United States, but many wealth managers are prolifeback and professionals are starting to find that friends around him are talking about it, asset dissonation wealth companies are recommending it, and many banks and insurance companies are asking for it.
What kind of financial products is this, there is so much attractiveness and market power - is the popular life insurance index in the United StatIes, IndexEd Life Insurance (IUL).
Indexed Universal Life Insurance, the largest growth product in the U.S. financial sector, is in good shape, according to the latest limra data. The benefits will attract more investors of global wealth. Financial investment products related to the index rose while the U.S. S.S. and S.P. 500 index reached record highs. Among the most exciting investors are IUL, indexed universallifeinsurance. It should be noted that the financial product has been solid since its inception and has already accounted for half of the U.S. life insurance market.
2.How did IUL arrive?
The American company is inclusive and complex, and its financial products have changed. With the continuous change of the U.S. economy, financial markets and laws and regulations, asset allocation and wealth management of extremely important insurance wealth management products are also constantly evolving, the survival of the fittest, each has its own twists, old wealth management products and types of insurance are replaced , the rapid growth of a new generation of products. This is the inevitable trend of financial product development in each country.
In the United States, the rapid development of life insurance, or after the end of World War II, when dominant products were very common and traditional all life and life to term. The costs of whole life are relatively high, but have a cash value and are insured for life. And the lifespan is cheap, but has a deadline, usually 20-30 years of protection. In the 1980s, the U.S. market began to appear as universal universal insurance, permanent insurance, premiums can be flexible to pay and can float in a certain range. Such a product of course compensates for the entire costly life premium and non-floating gaps.
In the 1990s, the U.S. stock market continued to prosper, and the market immediately emerged as a popular investment insurance market, which suddenly occupied most of the U.S. insurance market. However, we also know that the U.S. financial sector after 2000 there were two crises, one in 2002 financial crisis, the other in 2008, both financial crises hit investment insurance, this phenomenon, for financial product researchers pointed out a way, clients generally like high returns, but also aversion to its high risk with the ups and downs of the market. Can we have a product that gets the average return on the market and does not fall with the market? Thus, index insurance stands out and shines.
The index goes up, the interest is higher, the value of the cash increases, and of course, the index goes down, the value of the cash does not increase, but it does not lose money. Coupled with the cash value of the insurance, or the use of this policy loan, it is a tax-optimized structure, even if there is interest, interest can be taxed as the deduction of investment interest charges, insurance companies charge a decrease in operating costs management.
For the tax structure, of course, we need to focus on. IUL was designed to fully review and comply with Section 7702 of U.S. tax law, which is the definition of life insurance, in order to design the most favourable structure of life insurance tax legislation. As a result, his claim for death is also in accordance with U.S. Tax Act 101 provisions, exempt from personal income tax.
On inheritance tax: We know that the United States has a country that has inheritance and gift taxes. For U.S. taxpayers, life insurance is still included in the heir's estate at the federal level, and faces the question of whether the total assets exceed the lifetime tax allowance for inheritance tax and therefore the inheritance tax. But it is only levied on U.S. residents, and the current tax allowance is as high as $11 million. For foreigners, it is not at all a question of inheritance tax.
In addition, life insurance at various stages such as purchase link, cash withdrawal, loan, withdrawal, withdrawal, loss, annuity conversion, death claims, terminal care, especially withdrawal to determine if there is a federal tax law 7702A defined MEC, in U.S. tax law and tax filing, there are very detailed provisions and a different analysis, can not be generalized.
The design of IUL insurance is very flexible, some insurance companies also add major illnesses, long-term care and other functions, more intimate and user-friendly.
4.Who is suitable for IUL?
Index insurance IUL is, after all, a life insurance policy that can accumulate cash value over a longer period of time. Young and strong, healthy, the cost of premiums is low. However, if you are going to accumulate cash value mainly through it, you will need to have a long-term investment, after all, the first few years will be less cash value. If you want to save the children's education fund through IUL, it is better to buy IUL around the age of 4 years, so there are more than 10 years of sustained growth, usually everyone is the child when they read by borrowing from the child to read, one is no income tax, the other is that this kind of loan behavior and insurance assets do not affect the child in the application for grants such federal that the FAFSA effect is very good.