1 Policy loans and withdrawals will reduce the available cash value and death benefit and may cause the policy to lapse, or affect guarantees against lapse. Withdrawals in excess of premiums paid will be subject to ordinary income tax. Additional premium payments may be required to keep the policy in force. In the event of a lapse, outstanding policy loans in excess of unrecovered cost basis will be subject to ordinary income tax. If a policy is a modified endowment contract (MEC), policy loans and withdrawals will be taxable as ordinary income to the extent there are earnings in the policy. If any of these features are exercised prior to age 59½ on a MEC, a 10% federal additional tax may be imposed. Tax laws are subject to change and you should consult a tax professional.
2 Withdrawals from the cash value do generally count as income when applying for other types of financial aid. Please see the chart on the next page and your university or college for further information regarding eligibility requirements, as they may vary by school.
The death benefit is generally paid to beneficiaries income-tax-free.
There is no guarantee the policy will earn sufficient interest to support a loan strategy.
It is important to manage policy values carefully when taking out loans to avoid policy termination and a lapse in coverage.
FIUL is subject to health and financial underwriting.