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Sep 25, 2021 by |

Los Angeles Financial Elder Abuse Attorney: Important Consumer Warnings About Universal Life


State Agency Warnings About Rising Premiums

Risk Of Policy Lapses

Low Rates Of Return

Evans Law Firm, Inc. recommends against indexed universal life insurance and deferred annuities for senior consumers because both insurance products are expensive, complicated, and tie up invested money for long periods of time.  Typically, deferred annuities are sold as single premium policies but with universal life insurance the premium payments are periodic and increase over time.  This can be a real struggle for seniors as discussed below.  Always get a second opinion from an investment advisor with nothing to gain from any sale of a deferred annuity or life insurance and talk to your tax advisor as these products have significant tax consequences on purchase, replacement, or surrender.  If you have already purchased a deferred annuity or universal life insurance policy and have experienced an economic loss and live in Los Angeles or elsewhere in California, call us today at (415441-8669 or toll free at 888-50EVANS (888-503-8267).

State Insurance Agency Warnings About Universal Life

One of the greatest dangers with universal life policies especially for older consumers is that premiums increase over time.  In New York State, the insurance department has received over 1400 complaints in a the last few years regarding universal life policies – higher than for any other form of insurance.  The Department issued this alert:

“The Department has seen many cases of consumers who purchased universal life insurance and who made payments for years, thinking their premium payment would not change or that their coverage would remain in effect.  But many found that their policies had lapsed (were no longer in effect) with little to no [cash] value due to declines in interest rates, market volatility and other factors, or they were required to pay large additional premium payments to keep their coverage in effect.”

As the alert warns, policies will lapse if the increasing premium payments are not made. Only using the cash value to cover the premium will eventually make the policy run out of cash value, at which time the policy will lapse if additional premiums are not paid. Other disadvantages to these policies include:

  • You do not fully participate in the market. Your participation rate in the index is not 100% and you do not receive the benefit of reinvested dividends as you would in a direct mutual fund investment,
  • You will lose money if you need to withdraw your funds. Surrender penalties and other adjustments are imposed for as long as 15 years on some IULs.
  • Your return will be capped. Even if the index you chose grows, your growth will be subject to a cap so that you do not receive the full benefit of the growth in the index. 

Contact Us

If you have sustained a loss on an indexed universal life insurance policy, contact Ingrid M. Evans at Evans Law Firm, Inc. for a free evaluation of your policy toll free at (888)50-EVANS (888-503-8267), or by email at <a href=””></a>.

Annuities and life insurance produce large sales commissions for brokers but are often inappropriate products for consumers, especially seniors.  Leading providers and distributors of life insurance and fixed, variable and fixed indexed deferred annuities in California are listed below.  We are not in any way suggesting that any of these carriers or distributors has done anything wrong.  Rather, the list is provided solely as a reference for our readers.

AIG/American General Life Insurance Company

Allianz Life Insurance Company of North America

American Equity Investment Life Insurance Company

American General Life Insurance Company/AIG

American International Group, Inc. (AIG)

American National Life Insurance Company

Athene Annuity & Life Assurance Company

Athene Annuity and Life Company

Athene USA

Aviva Life Insurance Company

AXA Equitable Financial Services, LLC

AXA Equitable Life Insurance Company/AXA US

AXA Advisors, LLC

Brighthouse Financial, Inc./MetLife

EquiTrust Life Insurance Company

Fidelity & Guaranty Life Insurance Company

Genworth Financial, Inc.

Genworth Life and Annuity Insurance Company

Genworth Life Insurance Company

Guggenheim Partners, LLC

Guggenheim Partners/Security Benefit Life Insurance Company

ING USA Annuity and Life Insurance Company

Jackson National Life Insurance Company

John Hancock Life Insurance Company

Lincoln Benefit Life Company

Lincoln Financial Group

Massachusetts Mutual Life Insurance Company

Metlife/Metropolitan Life Insurance Company/Brighthouse Financial, Inc.

Minnesota Life Insurance Company

Nationwide Investor Services Corporation (NISC)

Nationwide Life and Annuity Insurance Company

Nationwide Life Insurance Company

New York Life Insurance Company

Northwestern Mutual Investment Services, LLC

Northwestern Mutual Life Insurance Company

Northwestern Mutual Wealth Management Company

Pacific Life & Annuity Company

Pacific Life Insurance Company


Security Benefit Corporation

Security Benefit Group, Inc.

Security Benefit Life Insurance Company/Guggenheim Partners

Security Investors, LLC

Security of Denver Life Insurance Company/Voya

Transamerica Life Insurance Company

Voya Financial Advisors

Voya/Reliastar Life Insurance Company

World Financial Group Insurance Agency, Inc.

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