Amerus, Indexed Universal Life Insurance

Q: Jeff what are your thought on Amerus, Indexed Universal Life Insurance. I already have a $600,000 term Insurance policy and am considering the indexed policy as it does not end at a specific time, other than death, and what to make sure I leave a guaranteed death benefit for my wife and or children. I am 58 years old. I am maxing out my 401k and have no real debt.

A: The first issue is to verify that you need Universal Life insurance. If you do, I would then recommend finding a no-load version of it where there aren’t any surrender penalties and you have immediate cash value.

In my mind there is a big difference between looking at insurance to protect a risk and looking at it as an investment. For instance, a $600k UL would be pretty expensive and it could be 40 years before it pays out to your heirs. That’s an awfully long time.

If the need isn’t permanent then I prefer term. If you place a high priority on having it even if you live a normal life exectancy, then UL would be the way to go.

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