Variable Universal Life Insurance Vs Equity Indexed Insurance

It can be overwhelming to choose between variable universal life insurance and equity indexed life insurance. We hope the comparisons between these life insurance in this article will help you make a befitting choice.


Like variable universal life insurance, equity indexed life insurance gives you the option of modifying the payment of your premiums. So when you get either variable universal life insurance or equity indexed life insurance, you are not stuck with a certain premium amount forever. You even have the opportunity to raise or reduce the amount of your premiums depending on your financial situation.

Cash value

Variable universal life insurance alongside equity indexed life insurance comes with the accumulation of cash value. You can choose to withdraw or borrow from your cash value at any time. Also, this cash value is tax-deferred and can be invested in various investment markets. On the one hand, variable universal life insurance cash value can be invested in stocks, bonds, money market securities, and mutual funds among several other portfolios while on the other hand, equity indexed life insurance can only be invested in the stock market.

However, unlike variable universal life insurance that offers no protection against investment risks, equity indexed life insurance protects your investment against market inflation. For instance, assuming the stock market goes on a downward slide, your life insurance company assumes the risk and shields your equity indexed life insurance policy from losses.

Death benefit

The death benefit of both variable universal life insurance and equity indexed life insurance are not subjected to both state and federal income tax. So in the event of your death, your dependents will not be required to pay any tax to collect the death benefit.