How is variable life insurance regulated differently in Nevada?

Variable life insurance and variable universal life (VUL) are regulated differently from other permanent life insurance products in Nevada because the cash value is invested in separate accounts that fluctuate with market performance. This investment component subjects variable products to both insurance and securities regulation.

Agents selling variable life insurance in Nevada must hold both a Nevada life insurance license and FINRA securities licenses (typically Series 6 or 7, plus Series 63 or 66 for state securities registration). The dual licensing requirement ensures agents have training in both insurance and investment products.

Variable products are also subject to SEC registration as securities, meaning policyholders receive a prospectus disclosing all fees, investment options, and risks. Unlike whole life or IUL, variable product cash values have no minimum guaranteed floor—they can decrease if investment subaccounts perform poorly.

For Nevada consumers considering variable products, the investment risk is a primary consideration. Unlike IUL, which has a 0% floor protecting against market downturns (though cap rates typically 8–12% apply), variable life cash values can genuinely decrease to zero if subaccount investments perform poorly and fees are high.

The Nevada Division of Insurance and FINRA jointly oversee variable product agents and companies, providing dual regulatory oversight.

Agents in our network offer non-variable life insurance products (term, whole life, universal life, IUL) and can explain the distinctions between variable and non-variable permanent coverage options.