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1035 Exchange

A 1035 Exchange allows you to switch from one life insurance policy to another without triggering taxes on any gains. This is helpful if you want to upgrade your policy or move to a different type, like from a whole life policy to an IUL.

This exchange is named after Section 1035 of the IRS tax code, which permits these tax-free transfers. It’s a useful option for people who find a policy that better fits their current needs but don’t want to pay taxes on the policy’s cash value growth.