How to Read an IUL Illustration Before You Apply

Separate promises from projections

Ask your agent to point out the guaranteed and nonguaranteed columns. Identify the assumed payments and credited rates. Ask which policy terms can change and which values are actually guaranteed.

Use an actual carrier illustration for the proposed coverage. A social-media example or generic calculator cannot show the contract you would receive.

Test the funding plan

Ask for a lower-crediting scenario and find the age at which coverage would end under each scenario. Compare how much you would pay and what happens if you need to reduce or pause payments.

If loans are shown, ask about the loan rate, interest accumulation and effect on the death benefit. A projected stream of withdrawals or loans is not guaranteed income.

Take these questions to your review

What is guaranteed? Which charges can change? What payments keep the policy funded under less favorable assumptions? What could cause lapse? What would I receive if I surrendered it?

Keep the illustration and policy documents. Review the annual statement after purchase so you can compare actual results with the original plan and discuss adjustments when needed.

Sources and further reading

• NAIC: life insurance consumer information
• Washington insurance commissioner: cash value life insurance

Carrier sources explain product mechanics; linking to them does not imply an agency appointment or product availability.

Talk through your options

Tell me what you want your coverage to accomplish. We can discuss the costs, risks and alternatives in the context of your needs and budget.

General information only. Policy terms, funding requirements and availability vary. Approval and projected values are not guaranteed.