Access to CV w/o surrender charge?

May 10, 2019

  1. lcodilla
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    lcodilla New Member

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    Anyone know any carrier that offers an IUL with a rider allowing the owner to access the cash value without incurring any surrender charges during the surrender charge period? Please share if there are any.

    Thank you in advance!!
     
    lcodilla, May 10, 2019
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  2. pfg1
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    pfg1 Guru

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    LSW has it, I'm sure there are others
     
    pfg1, May 10, 2019
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  3. scagnt83
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    scagnt83 Worldwide Expert of Everything

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    Midland/North American has it. Allianz used to have it, probably still do. LFG has it but only for business cases.
     
    scagnt83, May 10, 2019
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  4. Allen Trent
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    Allen Trent Guru

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    many do. but keep in mind, the client pays additional ongoing costs many times for this privilege. Also, to offset that risk to the carrier, many carriers pay reduced compensation to the producer that spreads the compensation out over 3-7 years depending on the premium size to lessen the risk to the carrier that the client will walk with most of the cash after the carrier paid underwriting costs, options costs, taxes, commissions without a surrender charge protection

    like others have said, other than unique large business cases that need to see an asset stay level on their balance sheets, there really is no need for this & it impact the performance of the cash value slightly over the years.
     
  5. DHK
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    DHK "YOU CAN'T HANDLE THE TRUTH!"

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    High Early Cash Value policies may be different than waiver of surrender charge riders.

    I know Midland and North American offer this waiver... however the chargeback risk period is extended out to 3 years.
     
    DHK, May 10, 2019
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  6. lcodilla
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    lcodilla New Member

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    Ahh, got it. Thank you so much for all the responses! I forgot about the chargeback risk and comp spread if the rider is used.

    So only large business cases would make sense for it...understood

    Thanks again everyone!
     
    lcodilla, May 10, 2019
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  7. jdumond
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    jdumond Expert

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    Um....a loan? :)
     
    jdumond, Jun 13, 2019
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  8. Golfnut2112
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    Golfnut2112 Guru

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    It won’t work, you can only loan the cash value otherwise why have surrender charges
     
  9. jdumond
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    jdumond Expert

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    Sorry, I wasn't sure which emoji would indicate tongue in cheek. Apparently, I chose the wrong one. Yes, you are correct :)
     
    jdumond, Jun 19, 2019
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  10. Jason T Brown
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    Jason T Brown New Member

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    Yes, there's several accurate and good comments here on previous responses! I've worked with IUL since the late 90's and I know of several carriers that offer early cash value riders and/or waiver of surrender charges on their IUL products (way more than North American/Midland). Just remember, nothing is free! These riders can be the perfect prescription/remedy for the customer when this is needed, but your 1st year compensation will (naturally) be dramatically reduced. Furthermore, some of the premium finance companies will require this feature/rider be elected if you're doing premium finance and using IUL. For example, Allianz Life, Ameritas, LSW/National Life and Minnesota Life (Securian) are just a few examples. - JTB
     
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