One-Year Term Insurance

In Indexed Universal Life (IUL) policies, One-Year Term Insurance represents the Cost of Insurance (COI) component. Its main features:

• Annual Coverage: Provides life insurance for one year at a time.
• Premium Allocation: A part of the premium pays for this renewable term insurance, covering the death benefit.

Cost Dynamics and Policy Mechanics:

• Age-Related Cost Increase: The cost may rise each year as the insured ages.
• Deduction from Cash Value: This cost is subtracted from the policy's cash value.

Investment Aspect:

• Excess Premium Utilisation: The remainder of the premium, after administrative and other charges, is invested in index-linked options.
• Potential Market-Linked Returns: These investments can yield returns based on specific market index performance.

One-Year Term Insurance is pivotal in balancing death benefit coverage and investment growth in IUL policies.