Principal Life Insurance Review 2022 – Forbes Advisor

Principal term life insurance

Principal offers two types of term life insurance for business owners—group term life insurance and voluntary term life insurance.

Principal offers guaranteed issue term life insurance that business owners can use for themselves and key employees. Coverage up to $5 million per policy is available, with level premiums for 10 or 20 years.

Some group life insurance policies from Principal come with access to some helpful benefits, which include a will and legal document center, an emotional health support line and an identity theft protection kit.

Principal also offers group term life insurance that you can offer to your employees. You can choose to pay all, part or none of the group life insurance premiums for your employees, depending on your business budget. Additionally, you can offer Principal’s voluntary term life, which allows employees to increase their coverage at their expenses and/or add life insurance for their dependents.

Principal’s universal life insurance

Universal life insurance might be a good fit for you if you’re looking for lifelong coverage. When you have a policy that builds cash value, you can withdraw or take loans from the cash value for any reason.

Principal Universal Life Flex III offers flexible death benefits and premiums, and the potential for cash value accumulation. The death benefit is offered in three ways:

  • Face amount by itself
  • Face amount plus cash value
  • Face amount plus premiums paid, minus loans and partial surrenders

You can withdraw or borrow against the cash value you accumulate.

Coverage amounts range from $100,000 and up for businesses and from $25,000 and up for individual buyers. People ages 0 to 85 may apply. Those who qualify can get a Universal Life Index III policy without a life insurance medical exam.

Principal Universal Life Flex III offers a guaranteed minimum annual rate of 1% for cash value accumulation.

Principal also offers Universal Life Provider Edge II for people ages 20 to 85. It has a minimum death benefit of $100,000. Those who qualify can get a Provider Edge II policy without a life insurance medical exam.

Principal also sells the Principal Survivorship Universal Life Provider policy. It covers two people under one policy and pays the death benefit when both individuals have passed away.

It’s ideal for those with legacy or estate planning needs, or for transitioning a business when a business owner has died. A big bonus: One applicant for the Survivorship Universal Life

Provider policy can be an uninsurable risk. That means the survivorship policy can be a vehicle for providing life insurance to someone who may otherwise not be able to buy coverage due to health issues.

Other key features of Principal’s survivorship life insurance include:

  • Optional extended no-lapse guarantee means locked in coverage to the age of 100 for the youngest person on the policy.
  • The survivor can tap into the death benefit if diagnosed with a chronic or terminal illness.
  • Available for term conversions.

Principal’s indexed universal life insurance

Indexed universal life insurance may be worth considering if you’re looking for the potential to grow cash value based on an index, like an S&P 500 index. These policies also often have the flexibility to vary premiums and death benefits. Be sure to review the participation caps and fees so you’re fully aware of how the policy works.

Principal Indexed Universal Life Flex II is for people ages 20 to 85 and offers a minimum death benefit of $100,000. It gives you a flexible premium with death benefit protection in three options: fixed, increasing (based on cash value) and return of premium.

The Indexed Universal Life Flex II allows you to grow cash value based on the S&P 500 Price Return Index or the S&P 500 Total Return Index. Or choose a fixed-rate account. The policy’s cash value has a 0% growth floor and a growth cap never less than 3%.

Principal also offers another indexed universal life insurance product: the Indexed Accumulation II.

Principal’s variable universal life insurance

Variable life insurance is not a “set it and forget it” type of policy. Variable life insurance may be an attractive choice for those with long-term insurance, investment and tax-planning needs, and who are also comfortable having an active role in deciding investment options.

You can take withdrawals or loans from the cash value the policy accumulates, but the policy can lapse if the cash value amount gets too low to cover the fees that are charged each month by the insurance company.

The value of the cash value portion of a variable life insurance policy is based on premiums paid, fees and expenses charged by the insurance company, the performance of the investments and loans and withdrawals taken.

Principal sells two variable universal life insurance products—Executive VUL III and VUL Income IV. Both are designed to accumulate cash value based on market performance. There is no limit to earnings or losses, which means there’s the potential for bigger growth compared to other types of universal life insurance, but there is also a higher risk.

Executive VUL III is designed specifically for business owners and has a minimum death benefit of $100,000.

VUL Income IV has a minimum death benefit of $100,000 and qualified applicants can get coverage within 24 hours without a medical exam.

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