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Apr 14, 2016 by |

The Risks Associated With Indexed Universal Life Insurance: A Look at Accordia Life

Accordia Life is a subsidiary of Global Atlanta Financial Group Limited, which is a financial services group company with 9 offices and more than $40 billion in assets. Accordia Life offers annuities and life insurance policies, including several different indexed universal life insurance options. Accordia’s website describes indexed universal life insurance as having “upside potential with protection from market risk.”

There are multiple different indexed life insurance options available through Accordia, including Lifetime Foundation IUL, Lifetime Builder IUL, Survivorship Builder IUL, and Accordia Life Provider IUL. The policies provide either an initial or extended death benefit guarantee and allow cash value to accrue which can be invested. Investors have the option to determine the amount to invest in a fixed account and the amount to invest in indexes.

When purchasing any indexed universal life insurance policy, consumers must do their due diligence. Promotional materials often focus on growth potential, protection from negative market returns, flexibility of coverage and tax-advantaged investments. However, unexpected fees and costs may arise and investments may not be appropriate for all consumers. Those who received bad financial advice, were misinformed about policy details, or who have experienced unexpected changes in policy terms or rates should consult with a California elder abuse lawyer to discuss legal remedies.

Indexed Universal Life Insurance Risks

With the purchase of indexed universal life insurance, investors have the opportunity to determine how much of the cash value of their policies should be placed in a fixed account with guaranteed minimum interest rates and how much of their cash value should be invested in equity indexes. Investments offer protection from downside risk by guaranteeing principle, but there are generally limits on returns in exchange for the protection from loss.

Indexed universal life policies are typically intended to be kept for life. The policies generally have long surrender periods. Unfortunately, many policyholders are surprised to discover the difficulty of extracting themselves from these investments due to high surrender fees. Policyholders may also discover their costs rise quickly as they age.  While many investors are told accrued interest from investment in the policy will pay for any rising premiums and costs, this is not always the case.

Policyholders who purchase indexed universal life may not only experience financial damage due to unexpected fees, but may also discover that the gains they were promised do not materialize. When indexed universal life policies are sold as a solution to provide financial security during retirement, this can be devastating to seniors who cannot afford to keep high-cost policies and do not have the retirement nest egg they were expecting.

If you sustained financial damage or loss and you believe you were misled or sold inappropriate investments, you may have the legal right to compensation for your damages. A financial elder abuse attorney can represent policyholders who wish to determine if they have a claim based on investments in indexed universal life insurance or other types of indexed universal life policies. Call the Evans Law Firm, Inc. at 415-441-8669 or toll free at 888-503-8267 today to learn more.


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