Were You Sold an Indexed Universal Life Policy as a “Defined Benefit Plan”?
If a financial advisor, insurance agent, or marketing group told you that an Indexed Universal Life (IUL) policy could serve as a “defined benefit plan” for your business or retirement, you were likely misled. At RP Legal LLC, we represent clients across the country who were sold complex insurance contracts under the false premise that they were adopting a qualified retirement plan.
We are the national leaders in IUL litigation and have brought claims against agents, insurance carriers, and marketing organizations for deceptive practices involving IULs disguised as defined benefit plans.
Why This Marketing Pitch Is Misleading
A defined benefit plan is a qualified retirement plan governed by ERISA and the IRS. It comes with strict rules, contribution limits, tax compliance requirements, and legal protections. These plans are generally established by employers to guarantee a specific retirement benefit based on salary and years of service.
An IUL policy is not a defined benefit plan. It is a private insurance contract with no government oversight, no guaranteed payout, and no structural protections for the purchaser. When agents refer to IULs as “defined benefit plans,” they are blending terms to confuse clients and create the illusion of safety and legitimacy.
This tactic is often used in:
- Small business settings where the owner wants to maximize retirement savings
- Executive benefit scenarios involving high-income earners
- Professional service firms sold on “creative retirement solutions”
- CPA-led or attorney-coordinated plans without proper compliance safeguards
In nearly all cases, the IUL strategy fails to deliver on the promised tax treatment or income projections. And the client is left with a high-cost, underperforming policy that was never appropriate to begin with.
Red Flags in IUL “Defined Benefit” Sales
We have reviewed hundreds of these cases and often see the same problematic patterns:
- The plan is pitched as a tax deduction for the business, but the product does not qualify
- The agent claims the policy provides guaranteed retirement income, when it does not
- There is no third-party administrator, plan document, or legal review
- The funding design is not sustainable and creates long-term premium obligations
- The policy loans are presented as income, without disclosure of loan risks
- The client believes they are protected by ERISA, when they are not
In many cases, the strategy was sold in coordination with a premium finance loan, creating even more risk and compounding the exposure.
What Really Happens
After the first few years of premium payments, clients begin to realize:
- The tax deductions they expected never materialize
- The policy’s cost of insurance rises sharply, draining value
- The promised income projections are based on non-guaranteed rates
- The loan strategy fails, and they are forced to inject more capital or surrender the policy
- They are exposed to significant tax consequences and have no true retirement asset
Meanwhile, the insurance agent or marketing team that sold the product may have collected commissions of $50,000 or more, funded directly from your premium payments.
RP Legal LLC Has Led the Nation in These Claims
We have represented business owners, doctors, dentists, franchisees, and professional service firms who were sold IULs as defined benefit plans. In nearly every case, the policies were misrepresented, the risks were never disclosed, and the financial projections were completely unrealistic.
We know how to identify the marketing language, illustrations, and documentation used to mask IUL policies as qualified retirement solutions. We investigate:
- Whether your plan was ever properly reviewed by a legal or tax professional
- If the advisor made false claims about tax treatment or income guarantees
- Whether the policy was structured to benefit the agent, not you
- If you were encouraged to roll over existing retirement funds into the IUL
Financial and Insurance Firms We Target
Several large insurance firms have been implicated in class action IUL lawsuits. Below is a list of some of the brokerages and firms we might investigate:
Insurance Companies
- Allianz
- Columbus Life
- Family First Life
- Minnesota Life/Securian Financial
- National Life Group
- Pacific Life
- Protective
- Prudential
- Transamerica
Financial Firms
- Ameritas
- Equis Financial
- Equitable AXA
- Five Rings Financial
- Global Atlantic (Accordia)
- Integrity Marketing Group
- John Hancock
- LifePro Financial
- Mutual of Omaha
- North American
- Penn Mutual
- PHP Agency
- Symetra
- Symmetry Financial Group
- World Financial Group
You May Have a Legal Claim
If you were sold an Indexed Universal Life policy as part of a “defined benefit” or “executive retirement” plan and have experienced losses or unexpected tax bills, you may be eligible for legal recovery.
RP Legal LLC will conduct a review of your policy, plan materials, illustrations, and correspondence. We will help you understand how the product was structured, what went wrong, and what legal options you have to recover your losses.
Call RP Legal LLC today at (803) 805-7546 or fill out our secure contact form to schedule your consultation. Let the nation’s leading IUL litigation firm help you uncover the truth and hold the responsible parties accountable.