Securian Financial offers a robust suite of universal life insurance products designed to provide permanent coverage while building cash value through interest-crediting strategies. Unlike traditional whole life insurance, which features fixed premiums and guaranteed growth, Securian’s universal life offerings provide flexibility regarding premium payments and death benefit adjustments, allowing policyholders to pivot as their financial objectives evolve throughout their professional and personal lives.
Understanding the Landscape of Universal Life Insurance
Universal life (UL) insurance is a form of permanent coverage that remains in effect for the policyholder's entire life, provided the premiums are paid and the policy’s cash value remains sufficient to cover the monthly cost of insurance and administrative charges. Securian Financial, headquartered in St. Paul, Minnesota, is a mutual holding company structure that historically differentiates its offerings through a focus on competitive interest-crediting potential and flexible underwriting guidelines.
When reviewing a Securian universal life policy, it is essential to distinguish between the various iterations of their products, such as Indexed Universal Life (IUL) and Variable Universal Life (VUL). While the core mechanism—the separation of the cost of insurance from the cash value growth—remains consistent, the method of determining the interest credited to the policy’s cash value differs significantly between these versions.
Core Features and Flexibility Mechanisms
The primary appeal of a Securian universal life policy lies in the structural flexibility it offers. Policyholders are not tied to a rigid premium schedule found in many whole life contracts. Instead, you have the ability to adjust the amount and frequency of your premium payments, provided the policy maintains a sufficient account value to sustain the death benefit.
Premium Flexibility
In the early years of a policy, paying more than the minimum "target premium" can accelerate cash value accumulation. Conversely, during periods of financial hardship, you may be able to reduce your payments or, in some cases, skip premiums temporarily, provided the policy’s internal cash value has accumulated enough to cover the monthly deductions. This level of control is a major advantage for business owners or individuals with fluctuating income.
Death Benefit Adjustments
Securian policies often allow for a choice between two death benefit options:
- Option A (Level Death Benefit): The face amount remains constant. As cash value grows, the "net amount at risk" for the insurance company decreases, which can be a cost-effective way to maintain coverage.
- Option B (Increasing Death Benefit): The death benefit is the face amount plus the current accumulated cash value. This option generally results in higher policy costs over time but ensures that the policy’s cash value is paid out alongside the initial face amount to beneficiaries.
Interest-Crediting Strategies and Growth Potential
The growth of cash value in a Securian universal life policy is linked to the performance of specific indices or interest-bearing accounts. Unlike the volatility of direct market investment, these policies often include "floors" (guaranteed minimum interest rates, often at 0% or slightly above) that protect the principal cash value from market downturns.
Indexed Universal Life (IUL) Components
Many of Securian’s modern universal life products are categorized as Indexed Universal Life. With an IUL, your cash value is credited interest based on the performance of a market index, such as the S&P 500. However, this growth is capped by "participation rates" and "caps."
- Participation Rate: The percentage of the index's growth that is credited to your policy.
- Cap Rate: The maximum interest rate credited to the policy, regardless of how well the index performs.
This structure allows policyholders to capture a portion of market upside while eliminating the risk of a negative return during a market crash. It is a conservative to moderate growth strategy suitable for those prioritizing long-term capital preservation over aggressive investment returns.
Comparison of Permanent Life Insurance Vehicles
| Feature | Whole Life Insurance | Universal Life (Securian) | Variable Universal Life |
|---|---|---|---|
| Premium Payments | Fixed/Rigid | Flexible | Flexible |
| Cash Value Growth | Fixed/Guaranteed | Linked to Indices | Linked to Sub-accounts |
| Risk Exposure | Low | Low to Moderate | High |
| Management Needs | Minimal | Moderate | High |
Eligibility, Underwriting, and Application Process
Securian Financial uses a risk-based underwriting approach. To apply for a universal life policy, an applicant must undergo a medical assessment. In 2026, the process typically involves:
- Financial Needs Analysis: A licensed agent or broker will determine the appropriate coverage amount based on your income, debts, and long-term financial goals.
- Medical Underwriting: This ranges from simple health questionnaires to full paramedical exams, including blood work and urine analysis. Your "class" (e.g., Preferred Plus, Standard, Substandard) determines your monthly cost of insurance.
- Policy Issuance: Once underwriting is complete, a formal offer is made. Review the "Illustration" document carefully, as it details the projected cash value growth based on current interest rate assumptions.
Note: It is crucial to distinguish between a "guaranteed" outcome and a "non-guaranteed" projection. Financial illustrations often show scenarios with higher interest rates than current market conditions might support in the long term. Always request a "stress test" illustration that assumes lower interest crediting to ensure the policy remains viable even during prolonged periods of economic stagnation.
Potential Limitations and Risks
While Securian provides a high degree of flexibility, there are inherent risks to universal life products that consumers must navigate.
The Risk of Lapse
If the cash value is depleted—due to excessive policy loans, high administrative fees, or long periods of low interest crediting—the policy may enter a "lapse" state. If a policy lapses, the death benefit is lost, and the owner may face significant tax consequences on the withdrawn or borrowed cash value.
Cost of Insurance Increases
In many universal life policies, the cost of insurance increases as you age. While the cash value growth is intended to offset these rising costs, if the growth underperforms the projections, the policyholder may be forced to pay significantly higher premiums later in life to keep the policy from lapsing.
Surrender Charges
Universal life policies often include a "surrender charge" period, typically lasting 10 to 15 years. If you decide to cancel the policy or withdraw significant funds during this window, the company will assess a penalty, which can substantially reduce the cash value you receive.
Frequently Asked Questions
Is a Securian universal life policy considered an investment?
While the cash value component allows for tax-deferred growth, universal life is primarily an insurance product. It should be viewed as a tool for permanent protection and wealth transfer rather than a primary vehicle for short-term investment or high-yield returns.
Can I access the cash value of my policy?
Yes, policyholders can typically access cash value through loans or partial withdrawals. Loans are generally tax-free as long as the policy remains in force, but they accrue interest and reduce the death benefit if not repaid.
What happens to the policy if interest rates stay low for a long time?
Because Securian’s universal life policies are interest-sensitive, prolonged low-interest environments may require you to pay higher premiums to maintain the same death benefit. It is recommended to review your policy illustration annually with a financial professional.
Is my policy protected if Securian Financial faces financial difficulty?
Securian Financial is a highly rated insurance carrier. Additionally, life insurance policies are protected by state-level guaranty associations. These associations provide a safety net for policyholders up to certain limits should an insurer become insolvent.
How does Securian compare to other carriers?
Securian is often noted for its competitive pricing on secondary guarantee universal life products and its innovation in indexed growth strategies. However, comparing "apples to apples" is difficult because universal life policies are highly customizable. Always compare the "Guaranteed Cash Value" and "Target Premium" lines across multiple company proposals.
Final Recommendation and Next Actions
A Securian universal life policy is best suited for individuals who require permanent life insurance but desire the ability to adjust premium payments to match the ebbs and flows of their cash flow. It is particularly effective for high-net-worth individuals focused on estate planning or business owners looking for a flexible funding vehicle.
Before committing, take these three steps:
- Request a current-assumption illustration: Do not rely on historical averages; look at current interest rates and how they affect your break-even point.
- Evaluate the "No-Lapse Guarantee": If the primary goal is death benefit protection rather than cash accumulation, ensure the policy includes a rider that guarantees the policy remains in force regardless of interest rate performance.
- Consult a fiduciary advisor: Because universal life is a complex financial contract, have a fee-only financial planner review the policy’s structure to ensure it aligns with your total financial picture, rather than relying solely on the input of the commission-based agent selling the product.
