20 pay options

[scagnt83]

What about companies that have the best whole life rates for a 37yr old male smoker

Rates (meaning premiums) are irrelevant to someone who wants WL for CV.

Dividends and rate of return on CV are what they usually want to see.

NYL has the 2nd highest Dividend in the industry right now.

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It is hard to find a product that is substantially "better" than NYL WL.
NYL, Mass, Guardian, NWM, are all on the same level.
After that, I would list Penn, Ameritas, Lafayette as slightly under the first level.

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What you need to look at is policy design.
What is the 7-pay premium? (it is listed in his contract)
What is he paying now?

If there is a large gap between the two, you know the policy is not overfunded, therefore it is not designed to maximize CV.

IF that is the case, then you have a true prospect in a completely ethical way.

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I get that he is interested in IUL. Maybe that is indeed the right fit for him. But make sure it actually is. And also make sure you truly know what he has now.

If he is dead set on moving to a different policy, then find him the best one you can.

But there is nothing wrong with a NYL WL, generally speaking.

Does the product and the way it is funded meet the goals of the client? That is a different story.

 

[DHK]

What about companies that have the best whole life rates for a 37yr old male smoker

I sure hope I'm reading too much into your posts and requests.

The client wants a better rate (I'm assuming rate of return or ROR) in their current policy, but the way you're phrasing that you want the best whole life rates... appears that you want the lowest premium policy?

Rate of return is meaningless without sufficient balance to earn that ROR.

Here's how a whole life policy works:

• Cash values must equal the death benefit at maturity.
• Maturity is age 121.
• Since the proposed insured is currently 37, we're looking at the present value of payments for 84 years given current interest rate assumptions (which are LOW thanks to recent legislation regarding IRC section 7702). [EXTERNAL LINK] - A Small Tax Change Is a Boon for Permanent Life Insurance.

Get out your financial calculator:

• Since I don't know the death benefit you want to calculate for, I'm going to use $500,000 for an example.
• FV = $500,000
• PV = $0 (or if there's any balance to put into the policy via 1035 exchange)
• N = 84
• I = 3.5% (I'm assuming a decent interest rate factor, but that's not a bad number)
• Solve for PMT = -$1,030.12 for the minimum annual payment NOT including costs of insurance. (Btw, the number is negative because you're putting money out of your pocket to put into this policy.)

Now, if you want a shorter time period to accomplish this, the premium goes up substantially.

This is not something where you look to put in the LEAST amount - unless you're really solving for a permanent death benefit.

This is an area where you solve how much you want to put into the contract and why. The death benefit... in these cases... is secondary.

You're doing a money purchase case, not a death benefit solve case.