IUL Lawsuits in Pennsylvania

Have you recently purchased an indexed life insurance policy in Pennsylvania? Insurance agents and firms might market indexed universal life insurance as a no-risk source of retirement income. They might tell individuals that they can protect their loved ones and grow their wealth tax-free.

The reality is that indexed universal life insurance is anything but a good investment for most people. These firms might hide outrageous and cumbersome fees behind flashy marketing, promising risk-free growth and guaranteed income. However, the hidden costs of the policies can jeopardize policyholders’ financial security.

If you have purchased an IUL product in Pennsylvania and lost money due to fraudulent practices or unmade disclosures, the IUL lawsuit attorneys from RP Legal LLC are here to assist. Insurance companies must make honest statements and representations when promoting financial products. If your broker lied to you or misled you about potential returns, you may have a claim for financial compensation. Depending on your circumstances, you may be able to recover compensation for:

  • The cost of paid premiums
  • The lost cash value of the policy
  • Cost of excessive fees and expenses
  • Emotional distress from financial strain

Contact our offices today or call (803) 805-7546 to speak to an IUL lawsuit attorney in Pennsylvania.

What Is an IUL and How Do They Work?

Indexed universal life insurance (IUL) is a type of permanent life insurance that can last your entire life if you continue to pay premiums. The defining feature of IULs is that they have a cash portion that is tied to the growth of a stock or bond index. This allows IUL policies to grow according to market rates instead of non-market rates like other types of permanent life insurance.

When you pay premiums on an IUL, a portion of those payments goes into an equity index account that tracks a given index, typically, the S&P 500. The index tracks market value, so the policy gains and loses value as the market rises and falls. Most IULs have interest rate floors and caps to keep growth between a specific range.

It’s important to note that IULs are not investment products, even though firms might market them as such. Regulations prevent insurance companies from directly investing premiums, so you are not buying direct stock exposure. You may be able to take out loans against the policy’s value, though this can reduce your death benefit.

IULs Come with Hidden Fees and Expenses

IULs have become increasingly popular in recent years because firms realize they can make substantial amounts from fees and account charges. Insurance brokers and agents can receive a handsome commission when they sell a policy, with commission rates as high as 100 percent in some cases. This commission structure incentivizes brokers to sell policies even if they are not a good fit for the customer.

Once you buy a plan, there are fees. Firms can charge exorbitant fees and may not disclose details when requested. Applicable fees for IULs could include:

  • Premium charges to cover the cost of insurance
  • Agent commission fees
  • Mortality charges to compensate for the risk of death
  • Expense charges for account management

Excessive fees can drain the value of your policy, even if the chosen market index performs well. If the cost of premiums rises and policyholders can’t pay, they may have to surrender the entire value of the policy.

Common Types of Insurance Misconduct

Unfortunately, insurance misconduct is relatively common in the IUL landscape. Fortunately, IUL providers guilty of misconduct can be sued for their wrongdoing. Below are some of the most common types of insurance misconduct.

Breach of Fiduciary Duty

Financial advisors and insurance agents are fiduciaries and are obligated to act in their clients’ best interests. Advisors and agents can be guilty of negligence if they have a conflict of interest or do not have the proper training. Further, insurance brokerages can be held accountable if they don’t train their agents to make truthful claims and representations in presentations.

Recommending IULs to Older Customers

IULs require a specific time frame to mature and accrue value. Firms might market IULs to older customers who won’t live long enough to fully take advantage of policy growth.

Deceptive Marketing Practices

Brokers and agents often make false or misleading claims about fees or sell IUL products as investments when they are not. Unscrupulous companies might withhold details from policyholders when asked.

Misleading Illustrations

IUL presentations might utilize showy graphs with misleading or inaccurate earnings projections. These projections often make overly optimistic assumptions about index performance and neglect fees.

Fraudulent Practices

Some companies have faced lawsuits over illegal and fraudulent practices, such as violating insurance contracts or stealing premium payments.

MLM Sales and Recruitment Tactics

Some firms are known for their deceptive multi-level marketing and sales techniques. These tactics rely on recruiting people to the lower level of the organization and siphoning their money to the top through fees and other charges.

Misleading Marketing Phrases You May Have Heard

Misleading marketing and advertising material is a common problem in the IUL landscape. Materials often make grand promises without properly discussing the risks, or they deliberately conceal important facts from customers. Below are some common phrases and slogans that should set off red flags in your head:

  • “Tax-free retirement income”: This expression makes it sound like IULs work like Roth IRAs and ignores the risks of rising insurance costs, lapses, and loan defaults.
  • “Be your own bank”: Being your own bank sounds nice, but it leaves out that borrowing from the policy reduces your death benefit. Borrowing against the policy can also cause the policy to lapse if you can’t pay the loan back.
  • “No downside market risk”: Every financial instrument has risks, especially IULs. Most IULs have a floor guarantee, but the exorbitant fees can cause you to lose money. IULs are not necessarily safer than traditional market assets, like stocks or bonds.
  • “Indexed growth with no loss”: IULs are not investments, so any language that talks about them in this light is misleading. Treating them as investments also ignores issues like expenses and spreads that can reduce policy growth.
  • “Outperform your 401(k)”: Earnings projections typically rely on overly optimistic assumptions about market behavior. Projections may also ignore things like employer matches and historical 401(k) performance.
  • “Tax-shelter for high-income earners”: IULs have tax-deferred growth, but they don’t provide any tax loopholes. Additionally, life insurance policies can lose preferential tax treatment if they contain too much cash.

Firms That Market and Promote IULs

We have pursued indexed universal life lawsuits against several large firms for fraudulent IUL and insurance practices. If you have purchased an IUL from one of the firms listed below based on misrepresentations, contact us to discuss your case:

  • Pacific Life
  • Allianz
  • National Life Group
  • Minnesota Life (Securian)
  • Fidelity and Guaranty
  • Lincoln Financial
  • Transamerica
  • Mutual of Omaha
  • Penn Mutual
  • Protective
  • Prudential
  • Symetra
  • MetLife
  • Equitable AXA
  • Columbus Life
  • World Financial Group
  • PHP Agency
  • Family First Life
  • Integrity Marketing Group
  • Five Rings Financial

IUL Lawsuits in Pennsylvania

Although these lawsuits may not have been filed in Pennsylvania, Pacific Life Insurance Company operates in the Commonwealth. Legal action has been initiated against the company based on the contention of multiple clients that they were misled by Pacific Life when sold the Pacific Discovery Xelerator IUL Policy. The suit contends that the company secured an unfair advantage because the policy is essentially incomprehensible, and because of burdensome surrender terms and deceptive practices.

If you’ve had similar experiences with Pacific Life’s IUL policy, call RP Legal LLC for a consultation.

How Can an Attorney from RP Legal LLC Help You?

Confronting insurers about their fraudulent products and tactics can be difficult due to the complex nature of IUL policies. Rest assured, the attorneys at RP Legal LLC have extensive experience pursuing lawsuits against large insurance firms and organizations. We are the nation’s premier firm for IUL litigation and have more experience in IUL lawsuits than any other firm.

We know how these insurance groups operate and how to untangle their scams. With our help, you can pursue financial compensation for the cost of premiums paid, the lost value of your policy, and losses from excessive fees and expenses. Depending on your circumstances, you may also be able to pursue compensation for emotional distress due to loss of financial stability.

Our approach to each case starts with a meticulous investigation. We can assess your policy terms and look for contract breaches or violations of insurance regulations. We can help you identify common red flags, such as:

  • Not performing a suitability determination before promoting products
  • Failing to disclose all fees upfront
  • Making false statements or using misleading materials to market IULs
  • Not supervising sales representatives
  • Violations of company policy and procedure

Contact an IUL Lawsuit Attorney in Pennsylvania

If you believe you have been pressured into buying an IUL scam, it’s essential to act quickly. The longer you wait to file a lawsuit, the harder it will be to gather evidence. RP Legal LLC can investigate and manage your case efficiently, giving you a higher chance of a successful resolution. We have recovered millions of dollars for victims of IUL policies gone wrong and are here to assist however we can.

Contact our offices online or call (803) 805-7546 today for a case consultation with an IUL lawsuit attorney in Pennsylvania. Our firm is available 24/7, so feel free to get in touch whenever it is convenient for you.

Last Updated: 08-06-2025

Case Results Our Record Speaks For Itself
Recoveries for Victims of IUL and FIP Investment Fraud
$10,000,000

RP Legal LLC has recovered over tens of millions of dollars for victims in these cases.
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Jury Verdict for Failed IUL Retirement Strategy
$1,500,000

A jury awarded $1,526,156.54 for our client, ruling against Pacific Life Insurance Company.

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Featured on InsuranceNewsNet
LEADERSHIP

Robert Rikard, founding attorney of RP Legal LLC, was recently featured in a nationally recognized insurance publication.

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Any result the lawyer or law firm may have achieved on behalf of clients in other matters does not necessarily indicate similar results can be obtained for other clients.

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