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Variable universal life insurance

What is variable universal life insurance?

Variable universal life insurance is a type of permanent protection that offers flexibility and the potential for growth by investing some or all of your cash value in subaccounts that are tied to the stock market — similar to how mutual funds are structured.

What does it offer?

In addition to lifetime protection, variable universal life insurance offers a unique combination of benefits to help meet your needs, including:

Enhanced growth potential

A variety of high-quality investment options mean the potential to earn a higher-than-average rate on your cash value accumulation.

Supplemental retirement income

If you’re already making the maximum allowable contributions to your qualified retirement funds, a variable universal life policy offers you the potential to build additional savings for retirement.

Tax advantages

All life insurance products offer tax advantages, including a tax-free death benefit and tax-deferred cash value growth to help you make the most of your investment.

Policy customization

You can customize a variable universal life policy with a variety of optional features for an additional charge, including the Long-term Care Rider.

How does variable universal life insurance work?

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A portion of your flexible premium payment goes toward the insurance, which includes any fees and death benefit coverage.

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The remaining premium goes into a tax-deferred savings account, with the opportunity to invest that cash value into subaccounts.

You have the potential to earn more than you would with fixed life insurance products; however, you also run the risk of investing in an underperforming market. If you pass away, the policy pays an income-tax free death benefit to your beneficiary.

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Who may benefit from variable universal life insurance?

Variable universal life insurance is designed for people who:

  • Are looking for a permanent life insurance policy that has the potential to accumulate cash value
  • Want more variety and control over their investment options
  • Prefer the freedom to monitor and make decisions on where to allocate their funds over time
  • Understands that investing involves rewards, but also risks that may have the potential to reduce the policy’s cash value.

Could variable universal life insurance be right for you?

See how it compares to other types of life insurance (e.g., variable universal life vs. whole life) to get a better idea of whether it meets your needs.


Variable universal life Term life Whole life Universal life
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Designed for low cost
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Access to your money1 checkmark icon
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Flexible payments2 checkmark icon

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How to buy variable universal life insurance

You need to work with an insurance professional to buy this type of product. If you don’t have one, our life insurance specialists are here to help.

Give us a call today at 1-855-529-2729 for a no-obligation consultation.

Hours of operation are 9:00 a.m. to 8:30 p.m. ET, Monday through Friday.

[1] This assumes that the contract qualifies as life insurance under section 7702 of the Internal Revenue Code (IRC) and is not a modified endowment contract (MEC) under section 7702A. Most distributions are taxed on a first-in/first-out basis as long as the contract meets non-MEC definitions under section 7702A. Loans and partial withdrawals from a MEC generally are taxable and, if taken prior to age 59½, may be subject to a 10% tax penalty.

[2] This assumes there is sufficient cash value to cover monthly policy charges. Keep in mind that variable universal life insurance has market volatility so it’s possible that you may need to pay an additional premium on your policy.

Variable products are sold by prospectus. Carefully consider the investment objectives, risks, charges and expenses. The product and underlying fund prospectuses contain this and other important information. Investors should read them carefully before investing. To request a copy, go to nationwide.com/prospectus or call 1-800-848-6331.

Keep in mind that investing involves market risk, including the possible loss of principal. Also, know that underlying investment options are available only in variable annuity and variable life insurance contracts. They are not offered directly to the public.

Keep in mind that taking money from your policy immediately reduces both the cash value and the death benefit payable and can cause the need for more premiums to be paid into the policy in the future. You should always take care to ensure that your life insurance needs continue to be met over time subsequent to taking cash from your policy.

Guarantees and protections are subject to Nationwide’s claims-paying ability. They do not apply to the investment performance or safety of the underlying investment options.