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Nov 20, 2014 by |

Transamerica Life Insurance Co. Indexed Universal Life Insurance Policies


In 1997, Transamerica Life Insurance Co. became the first insurance company to introduce the Indexed Universal Life insurance policy. Since then, Indexed Universal Life insurance policies have grown in popularity. Indexed Universal Life insurance policies base rate of returns on the performance of stock market index. Purchasers are attracted to the boasted high rate of returns, except the reality of it is that the promised returns won’t be so high and many purchasers don’t realize that Indexed Universal Life policies may harm them rather than help.

Indexed Universal Life policies are expensive, and become increasingly more so as ongoing costs and fees continue to increase the longer the policyholder lives. An Indexed Universal Life policy is a long-term policy – it ends when the policyholder passes away. By the time the policyholder passes away, costs and fees could have increased exponentially. Typically paid using accumulated interest, if the policyholder does not have enough accumulated interest to pay off the costs and fees, the policyholder will have to look elsewhere for funds – such as their retirement funds.

Indexed Universal Life policies also have a long surrender period with a high surrender charge. Because Indexed Universal Life policies are for life, one might think that renders surrender periods and charges moot. This is not the case. Most people end up cancelling their Indexed Universal Life policy because it runs for far too long. Due to the lengthy surrender period, one that typically exceeds the expected lifespan of the policyholder, oftentimes, this cancellation will occur before the surrender period is up and thus the policyholder pays a large fee.

If you purchased an Indexed Universal Life insurance policy from Transamerica Life Insurance Co. and would like a free and confidential legal evaluation of it, contact Evans Law Firm, Inc. at 415-441-8669 or by email at

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