Picture this: a life insurance policy that works for you. You not only have control over how the policy cash values are invested and managed, but you also put yourself on the clearest path to earning higher returns than other life insurance products. Meet Variable Universal Life Insurance (VUL).

 

Let’s begin by defining VUL. VUL is a type of flexible premium Universal Life insurance policy that allows the premium and the cash value to be invested in one or more separate accounts. These sub-accounts can include exposure to equities, fixed income, and indexed sub-accounts. As with all permanent insurance, the cash value in the policy grows tax-deferred. What’s unique about VUL is that the access to the aforementioned sub-accounts can provide potentially greater long-term benefits to the owner and beneficiary. With this flexibility, and the other flexibility inherent in Universal Life, VUL can be described as the swiss army knife of permanent insurance.

 

If long-term planning is on your radar, VUL could help you achieve your financial goals. Consider these advantages:

Death benefit protection

• If you find long-term death protection to be important (as you should), VUL provides income tax-free death benefit protection with the opportunity for the cash value growth on a tax-deferred basis.

 Performance

• VUL is unlike any other permanent life insurance product. It allows for premiums and cash value to be invested into multiple sub-accounts, often exhibiting growth that outperforms other life insurance products.

Simplicity and Transparency

• Because you have a vested interest in how your policy performs, wouldn’t you want to know how it’s designed and managed? With VUL, transparency is of the utmost importance and allows you a clear understanding of the product performance now and into the future.

Flexibility

Investment selection

• VUL works to meet your risk tolerance where it is. Because policyholders have a range of sub-account options, you can select how your premium and cash value is allocated with the peace of mind that your policy reflects your risk profile.

Surrender values

• VUL poses less risk to the Insurer allowing for higher cash surrender values, especially when compared to guaranteed products! What does this mean for you? Greater flexibility to adjust your policy as your life changes or new types of policies are introduced.

 

With VUL, you have flexibility and control over your long-term death protection combined with the ability to access the cash value on a tax advantaged basis later in life, should that be important. Flexibility = Control and Control = Flexibility

 

ABOUT OUR EXPERT:  Philip M. de Bruyn, Partner

Philip is the Partner in charge of the Risk Management group at Southern Wealth, and has been advising clients for over 35 years with respect to the design, implementation, monitoring and administration of their respective wealth transfer plans. 

Philip received a Bachelor’s degree in Finance from the University of Oklahoma and a Master of Business Administration from Southern Methodist University. Philip is a Registered Representative of Southern Wealth Securities, LLC, a Registered Broker/Dealer, Member FINRA. Philip is also an Investment Advisor Representative of Southern Wealth Management, LLP a Registered Investment Advisor as defined by the Investment Company Act of 1940. He currently serves on the board of M Financial Investment Advisors, Inc., Chairs the Board of Trustees of the Episcopal Foundation of Dallas, and serves on the Planned Giving Advisory Council at Southern Methodist University and the Estate Planning Council at UT Southwestern Medical Foundation. Formally, Philip was the Chairman of the Board of Trustees of The Parish Episcopal School and a member of the Parish Episcopal Foundation, Inc. board.

Philip is married to Crista, has two adult children, is a parishioner at the Episcopal Church of the Transfiguration, and enjoys golf, fishing, and motorsports. 

 

 

Disclosure: For Educational Purposes Only. This material is intended for informational purposes only and should not be construed as legal or tax advice. It is not intended to replace the advice of a qualified attorney, tax advisor or plan provider. Variable life insurance products are long-term investments and may not be suitable for all investors. An investment in variable life insurance is subject to fluctuating values of the underlying investment options and entails risks, including the possible loss of principal. Variable universal life insurance combines the protection and tax advantages of life insurance with the investment potential of a comprehensive selection of variable investment options. Risk is primarily the function of the insurance carrier’s financial wherewithal and sub-accounts are limited to the approved investments options defined by the carrier. The insurance component provides death benefit coverage, and the variable component gives you the flexibility to potentially increase the policy’s cash value. Investors should consider the investment objectives, risks, charges, and expenses of any variable life insurance product carefully before investing.