GUL · S-GUL · IUL · 10-Pay · Term Which one fits you?
Insurance carriers price all permanent life products against the same actuarial curve — but the wrong policy type at the wrong age can collapse mid-life or burn cash that GUL would have locked in cheaper. Here’s when each one wins, and the chart that explains why.
The cost-of-insurance hockey stick
Why when matters more than what.
The internal cost-of-insurance (COI) charges inside every permanent policy follow this curve. Below 60 it’s manageable. Past 70 it accelerates. Past 80 it goes vertical — which is why IUL cash value collapses fast at older ages unless aggressively over-funded.
Under 60 — flat, manageable, IUL window
61–67 — curve starts bending, GUL safer
68+ — vertical, IUL collapses without max-funding
What fits at your age
The same five products. Different answers depending on what side of 60 you’re on.
Under 60
IUL window is open
You have 30+ years for cash value to compound. Cost-of-insurance is still cheap. LTC accelerated-benefit riders are available and meaningful. Overfunding flexibility lets you handle good years and bad.
Best fit:IUL (with LTC rider) or 10-pay IUL. GUL is also fine if you want pure death-benefit certainty without the indexed cash-value play.
Age 61 to 67
GUL is safer · IUL only if max-funded
The cost-of-insurance curve starts bending. IUL works only if you’ll over-fund (max non-MEC) every year for 10+ years — otherwise rising COI eats cash value faster than indexed growth replaces it.
Best fit:GUL or 10-pay GUL for pure DB. S-GUL if a spouse is also insurable (~40% cheaper). IUL only with overfunding commitment.
Age 68 and up
GUL / S-GUL · IUL is usually a mistake
The hockey stick goes vertical. Without aggressive overfunding (which most retirees aren’t doing), IUL policies can collapse mid-life — cash value drained by rising COI, policy lapses, beneficiaries get nothing.
Best fit:GUL with no-lapse guarantee, or S-GUL (survivorship) if a spouse is insurable. Cheapest cost-per-thousand, zero rising-COI risk, locked-in death benefit.
Compare every type
All these compete to fund the same goal — legacy / wealth replacement / LTC coverage. The differences are real but specific.
Type
Lifetime DB Guarantee
Cash Value Growth
LTC Rider Available
Rising COI Risk
Cost (per $1M DB)
GULGuaranteed Universal Life · single life · level pay
✓
✗
~
none
$ (cheapest)
S-GULSurvivorship GUL · both spouses, 2nd-to-die
✓
✗
✗
none
$ (~40% off single)
10-Pay GULPaid up after 10 yrs · no premiums in retirement
✓
✗
~
none
$$$ (~2.6× annual)
IULIndexed Universal Life · indexed cash value
~
✓
✓
YES
$$ (~10% over GUL)
S-IULSurvivorship IUL
~
✓
✗
YES
$$ (~40% off single IUL)
Term10/20/30-yr, then expires
✗
✗
~
none (term)
¢ (cheapest, but ends)
Legend:✓ = built-in/guaranteed · ~ = optional rider or partial · ✗ = not available. Cost columns are relative — all dependent on age, sex, health, and term.
Where IULs go wrong at older ages
Why IUL at 68+ usually collapses (unless aggressively funded)
IULs are not bad products — they’re the wrong tool for someone who isn’t going to over-fund them. Here’s the mechanism:
Cost-of-insurance (COI) is age-banded.The carrier subtracts a monthly mortality charge from your cash value. At 50 that’s tiny; at 75 it’s 7–10× higher; at 85 it can be 30–50× higher.
Indexed growth has a cap.Even in a great market year, most IULs cap returns at 8–12%. After cap, participation rate, and policy charges, real net cash-value growth runs 3–6% in good years — 0% in bad years (the floor protects you, but it doesn’t grow).
At older ages, COI grows faster than indexed return.Once the rising mortality charge outpaces what the index credits, cash value decreases each year. If you stop funding, the policy eats itself.
The no-lapse guarantee isn’t free.You can pay extra for a no-lapse rider that keeps DB in force regardless of cash value — but at that point you’re paying GUL premiums for an IUL that no longer has cash value to use. Just buy GUL.
The fix is over-funding — not affordable in retirement.An over-funded IUL (max non-MEC contribution every year for 10+ years) can outrun the COI curve. But that’s a $50–100K/yr commitment most 68-year-olds aren’t making with retirement cash flow.
Bottom line:If you’re 68+ and want guaranteed legacy/wealth-replacement after a property sale, the structurally correct product is GUL or S-GUL with a no-lapse guarantee. Keep IUL for ≤60s with overfunding capacity and a real LTC-rider plan.
Run your specific scenario through the advanced calc.
Toggle between GUL, S-GUL, IUL, and 10-pay variants. See the actual premium at your age + health rating. The age-based advisor will flag whether IUL fits or not.
