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Product Review | United Life Legacy Accel Indexed Universal Life Insurance Policy

By , with Annuity FYI

Legacy Accel is fundamentally a generous cash alternative capable of generating up to about 7.5% a year by investing in a low volatility index or the S&P 500, based on its performance over the last five years.

United Life’s Legacy Accel May Be a Profitable Haven in Today’s Difficult Investment Environment

No question, this is a tough time for investors. At current writing, the stock market has been on the verge of a correction. Bond interest rates, meanwhile, are shooting up sharply, depressing the value of bonds following a Federal Reserve proclamation that it will increase interest rates this year to combat inflation.

Moreover, interest rates currently are still low, which means plain vanilla fixed annuities are not particularly attractive, either.

Is there a way out?

In fact there is, and it’s in the form of an indexed universal life insurance policy offered by United Life’s Legacy Accel. Net of expenses you can expect returns from 0.50% to 7.50% annually. Investors can exit the investment at any time without penalty. Essentially, it’s a lucrative cash alternative.

The investment closest to this is a fixed indexed annuity, which is unlikely to have the same upside potential as Legacy Accel because of unusually low index participation rates today. And if you want a guaranteed income rider, that costs about 1% a year, further undermining returns in exchange for guaranteed income. Most importantly, FIAs, unlike Legacy Accel, charge hefty penalties for early withdrawal, which is no small thing in an environment of rising interest rates.

Why is this so? Odds are good that fixed annuities and other fixed-rate products will be offering better deals a year from now. But those locked into FIAs today won’t have the flexibility to shop around.

The minimum investment in Legacy Accel is $25,000. Investors can invest in S&P MARC 5% index, a low volatility index offering a 135% index participation rate, or in the S&P 500 with an annual cap of 7.5%.

Those who invest in this strategy are not intending to hold the policy until death like a standard life insurance contract. United Life’s Legacy Accel provides the opportunity to earn more interest than a savings account, or mutual fund, without having to assume the risks in the market. That said, this policy does offer a tax-free death benefit should the insured pass while the policy is in-force.

It’s important to note that a potential downside to Legacy Accel is that the health of its owner is not insignificant. To qualify for the product, prospective owners must answer “No” to 19 health-related questions, which may be difficult, in particular, for the older set. Those who had significant heart issues in the last five years, for instance, don’t qualify. The good news is that couples can work around this if one of them is healthy. If the husband has health issues, for instance, he can buy the policy and name the wife as the insured.

It’s impossible to know how a buyer of Legacy Accel today would fare financially down the road, but the odds seem good that they can generate average annual returns of perhaps 4% to 5%, depending, in part, on which of the two indexes they invest in. Most pundits don’t think the market moving forward will be as robust as it has been in the last three, unusually strong, years. But this doesn’t mean the markets still won’t fare modestly well.

Here is a summary of the key pros and cons of Legacy Accel:


  • It’s 100 % liquid at all times, with no penalty for early withdrawal.
  • United Life Insurance Company has a good A.M. Best rating of A-
  • Because of its exposure to the markets, returns are highly likely to beat those of fixed income products.
  • Death benefits, if employed, are on average about twice the principal invested in the product.
  • Although buyers have to answer medical questions, they don’t have to take a medical exam, which is required for other universal life policies.


  • People not in good health won’t qualify to buy the product, although they’re likely to get around this with the help of a healthy spouse, or child, if they have one.
  • Even though Legacy Accel is essentially a cash alternative, some buyers may not like the fact that it doesn’t offer checking account privileges, unlike, say, a brokerage account.
  • The maximum investment for most buyers is about $400,000 – ample for most investors but probably not all.
  • Like all indexed investments, there is no guarantee that buyers will reap a good return. While unlikely, unpleasant developments could intercede. The economy, for example, could fall into a recession – not an unrealistic scenario amid rising interest rates – and this could easily undermine financial performance.

As noted, the minimum investment is $25,000. But interested investors should try to invest at least $50,000. Investing more than $50,000 will reduce the drag created by some of the fixed costs in the policy, which will help garner the best potential returns. Regardless, investors can freely withdraw 10% of their investment annually if they so choose.

For more information about the product mentioned in this article contact us here:

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