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Life insurance: protection and flexibility

Discover the benefits of an Allianz insurance policy.

What is life insurance?

A life insurance policy is a contract between you and an insurance company. Its main purpose is to provide a financial benefit (which is generally income-tax-free) to your loved ones if you die. The death benefit can:
  • cover funeral expenses
  • pay a mortgage
  • supplement educational expenses 
  • replace lost income
  • protect the value of an estate, and more

There are two main kinds of life insurance.


Term insurance provides a death benefit only for a specified period of time. It can be a good choice if you need basic death benefit protection and want level, affordable premium payments. 


Permanent insurance offers a death benefit for as long as your policy remains in force. It can be a good choice if you want flexibility, plus additional features that can complement your financial strategy. 
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Fixed index universal life (FIUL) is one type of permanent insurance.

There are many kinds of permanent life insurance (such as whole life, universal, and variable life). But only FIUL offers the potential to earn indexed interest – and Allianz is a leader in indexed products.

Why consider fixed index universal life insurance?

FIUL provides a combination of benefits that can help address a variety of common financial concerns:
  • Protection: Your beneficiaries get a death benefit that is generally income-tax-free.
  • Accumulation potential: Your policy’s accumulation value may earn interest based on an external index or a fixed interest option.
  • Tax deferral: Your policy’s accumulation value grows tax-deferred.
  • Flexibility: As long as your policy is properly funded, you can pay premiums when you want and access your cash value through policy loans and withdrawals.¹

Here's how FIUL works

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You pay premiums as you like.

As long as your policy is properly funded, you can pay your policy’s premiums when you want, and in the amount you choose. This can give you the flexibility to address other financial needs or unexpected expenses. 
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Your accumulation value grows tax-deferred.

Your policy’s accumulation value can earn interest based on the annual return of an external index. When interest is credited, it’s locked in and continues to grow tax-deferred. And because you don’t pay income tax unless you take money out of your policy, your accumulation value has more accumulation potential.

Your accumulation value is protected.

Although any indexed interest you receive is based on changes in an external index, you’re not actually participating in the market. This means your cash value won’t go down due to market volatility. (Fees and charges will still reduce the policy’s value, however.)

You can access your cash value.

Down the road, you can access your policy’s available cash value through income-tax-free loans and withdrawals for any purpose – such as helping fund a college education, supplementing your retirement income, or even helping cover a medical expense. Because loans and withdrawals will reduce your policy’s cash value, you’ll want to carefully monitor your policy’s values and make sure your policy is properly funded so it doesn’t lapse.

Tailor your policy to your needs.

In exchange for an additional cost (and with some restrictions, including underwriting), you can add optional riders that offer chronic illness benefits, premium payment waivers, extra term coverage, and more. Your financial professional can help you determine which rider(s) may make sense for your unique financial needs, and also explain the cost(s). 

Leave a legacy.

Your beneficiaries get a death benefit that is generally income-tax-free. It can help cover funeral costs, medical bills, pay the mortgage, replace your income, and even ensure the continuity of a business if you pass away.

Frequently asked questions

How do I know if I need life insurance?

The main purpose of life insurance is to provide a financial benefit to your loved ones if you die. If anyone is financially dependent on you, it’s likely you need life insurance.

Do I need life insurance if I don’t have dependents?

Even if you don’t have dependents, a fixed index universal life insurance policy can still benefit you down the road. For example, you might access the cash value to help cover an unexpected expense or potentially supplement your retirement income. Or suppose you had unsettled debt at the time of your death. The death benefit from life insurance could help pay that down, and help your loved ones cover final expenses.

What if I already have a policy through work?

Many employers offer term life insurance as a benefit. But as the name suggests, term policies cover you only for a specified period of time. This generally means that if you leave your job, your life insurance coverage ends. Purchasing your own permanent life insurance policy (such as FIUL) can provide financial reassurance over the long term, even if you switch jobs.

How much insurance do I need?

The short answer: It depends on a lot of factors. Your financial professional can help you assess your needs – both today, and into the future. Or, for a quick estimate, try our handy calculator.

What is underwriting?

Insurance companies use underwriting to make sure they can meet their guarantees before they sell you a policy. Underwriting is the process of assessing the risk of insuring you, and helping determine the cost of insurance. That’s why most life insurance policies require a medical exam: The younger and healthier you are, the less your policy is likely to cost.

What is indexed interest?

Simply put, it’s interest your policy earns based on positive changes in an external index. Allianz is a leader in indexed products. We track the performance of one or more indexes for you – and if the return is positive, you have the opportunity to earn indexed interest. But because you’re not actually participating in the market or buying shares in any index, your principal is never at risk due to market downturns (although certain fees and expenses will reduce policy values).

How is indexed interest calculated?

Indexed interest is determined through a combination of index allocation options and crediting methods. Every policy year you can place your accumulation value in one or more allocation options, which track the performance of an external index. If the external index has a positive result, we then use a crediting method – which is a formula to determine how much indexed interest your policy will earn. Because no single allocation or crediting method performs best in all situations, your financial professional can help you determine which combination may fit your financial goals.

Learn more about Allianz life insurance

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.

Guarantees are backed by the financial strength and claims-paying ability of Allianz Life Insurance Company of North America.

• Not FDIC insured • May lose value • No bank or credit union guarantee • Not a deposit • Not insured by any federal government agency or NCUA/NCUSIF

Products are issued by Allianz Life Insurance Company of North America, PO Box 59060, Minneapolis, MN 55459-0060.

Product and feature availability may vary by state and broker/dealer.