1. Premium Payments – Part of each payment covers the cost of insurance and policy fees; the rest is allocated to the cash value.
   
   
2. Index Tracking – The insurer uses a crediting formula to calculate interest based on an index’s performance, subject to a cap and floor.
   
   
3. Cash Value Growth – If the index rises, interest is credited up to the cap; if it falls, the floor protects against losses.
   
   
4. Policy Loans/Withdrawals – Funds can be accessed tax-free via loans (reducing the death benefit if not repaid).
   
   
5. Death Benefit Options – Choose between a level death benefit or one that increases with the cash value.

• Downside protection – Cash value is shielded from direct market losses.
  
  
• Upside growth potential – Can benefit from market gains up to the cap.
  
  
• Flexibility – Adjustable premiums and death benefits.
  
  
• Tax-deferred growth and tax-free access via loans.
  
  
• Permanent coverage – Protection lasts for life if policy stays funded.

• Cap limits – Gains are limited, which can reduce potential returns.
  
  
• Complexity – Credit formulas, caps, and participation rates can be hard to understand.
  
  
• Policy costs – Insurance charges and administrative fees can erode returns.
  
  
• Performance risk – Low or no credited interest in flat markets can impact cash value growth.
  
  
• Loan risk – Improper loan management can cause policy lapse and tax consequences.

• Individuals wanting permanent life insurance with market-linked growth and downside protection.
  
  
• People seeking flexibility in premiums and death benefits.
  
  
• Savers who want tax-advantaged growth without full market risk.
  
  
• Those who value long-term planning for retirement income or wealth transfer.

• A $500,000 Indexed Universal life policy for non-smoker monthly costs:
• 20: ~$215/month (men); ~$185/month (women)
• 30: ~$301/month (men); ~$267/month (women)
• 40: ~$495/month (men); ~$432/month (women)
• 50: ~$844/month (men); ~$714/month (women)
• 60: ~$1,525/month (men); ~$1,313/month (women)
  
  
• A $250,000 Indexed Universal life policy for non-smoker monthly costs:
• Age 25–35: Men $96–$122/month; Women $71–$96/month
• Age 35–45: Men $122–$171/month; Women $96–$148/month
• Age 45–55: Men $171–$303/month; Women $148–$238/month
• Age 55–65: Men $303–$491/month; Women $238–$445/month

• Lock in lower premiums while in better health and younger.
  
  
• Younger buyers have more time to benefit from compound cash value growth and remain backed by index-linked upside.
  
  
• Delaying purchase can mean prohibitive costs and limited flexibility.

Premiums are influenced by:

• Age, health, and smoking status.
  
  
• Policy structure: cap rate, floor rate, indexing method, and participation rules.
  
  
• Fees: insurance cost, administration, and expense loads.
  
  
• Product design complexity – frequent monitoring required to avoid policy lapse.