Any Feedback On The Nationwide Insurance IUL?

[Allen Trent]

Most illustration software allows you to print off the year by year expense and earnings report. I just looked at one from Nationwide a few days ago, don't know if it is selected separately from the base illustration but it's called the 'Annual Cost Summary".

It list yearly premium, premium load, policy fee, per 1000 expense, COIs, Rider charges, Interest credits and cash value and death benefit. I think there are only a handful of companies that don't make that available.

most I have seen, the agent has to click to add the supplemental pages & most agents dont because they dont want the client to be able to clearly see the projected fees/costs. Plus, the ones I have seen show only the current fees/costs, not the worst case guaranteed potential costs/fees

 

[PrivClientSG]

Most illustration software allows you to print off the year by year expense and earnings report. I just looked at one from Nationwide a few days ago, don't know if it is selected separately from the base illustration but it's called the 'Annual Cost Summary".

It list yearly premium, premium load, policy fee, per 1000 expense, COIs, Rider charges, Interest credits and cash value and death benefit. I think there are only a handful of companies that don't make that available.

Thank you very much for the insight. I greatly appreciate it. All important information to know.

 

[Tahoe Ray]

most I have seen, the agent has to click to add the supplemental pages & most agents dont because they dont want the client to be able to clearly see the projected fees/costs. Plus, the ones I have seen show only the current fees/costs, not the worst case guaranteed potential costs/fees

That's not why they don't add them.

Most either don't know how to read them or that they exist at all lol.

 

[Allen Trent]

That's not why they don't add them.

Most either don't know how to read them or that they exist at all lol.

If that is the case, why are they even optional? I have my default set to include it on every illustration.

I think you might be kidding yourself if you don't think upline/IMO & even carrier help desk don't suggest to the agent to exclude the costs supplemental output.........better for client to have to use a calculator to figure out something must be happening in the sausage making cause the calculator isnt showing 5.6% growth in cash value like the column heading states

 

[Tahoe Ray]

If that is the case, why are they even optional? I have my default set to include it on every illustration.

I think you might be kidding yourself if you don't think upline/IMO & even carrier help desk don't suggest to the agent to exclude the costs supplemental output.........better for client to have to use a calculator to figure out something must be happening in the sausage making cause the calculator isnt showing 5.6% growth in cash value like the column heading states

Totally agree that uplines/carriers exclude them as well when sending.

Probably just so there are less pages to skip when scrolling to the main ledger...ha!

It a complex product that is normally funded with large premiums.

"Keeping it simple" is a great sales approach but when it comes to these products, knowing what you're getting yourself into (as both a consumer and an agent) is paramount.

 

[Allen Trent]

Totally agree that uplines/carriers exclude them as well when sending.

Probably just so there are less pages to skip when scrolling to the main ledger...ha!

It a complex product that is normally funded with large premiums.

"Keeping it simple" is a great sales approach but when it comes to these products, knowing what you're getting yourself into (as both a consumer and an agent) is paramount.

Amazes me to see people that are paying $25k or $50k or even $100k+ per year into a Roth/401k alternative savings plan wonder why after 3 years it has very little money in it................Uh, #1, cause your death benefit is 3-4x more than it needed to be to fit the same amount of premiums, thus making the policy issue fees in the early years that much higher, the surrender charges that much higher, etc.

the irony is the 5-10 page anniversary statements after purchase sure are clear about all the costs associated

 

[scagnt83]

I have never seen an expense report that shows guaranteed expenses.

Ive always had to go to the specimen policy to find the ratio of current/guaranteed, then work backwards to "best guess" the total.

Certainly not exact, but in general, if you know guaranteed expenses are 50% more, you can plan around that and run illustrations with that reduction in mind.

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An IMO or Carrier adding the expense report to an illustration without being asked?!

 

[scagnt83]

Amazes me to see people that are paying $25k or $50k or even $100k+ per year into a Roth/401k alternative savings plan wonder why after 3 years it has very little money in it................Uh, #1, cause your death benefit is 3-4x more than it needed to be to fit the same amount of premiums, thus making the policy issue fees in the early years that much higher, the surrender charges that much higher, etc.

the irony is the 5-10 page anniversary statements after purchase sure are clear about all the costs associated

Ive seen/heard some crazy stuff as well. Some are being told to even ignore the current illustration because "they cap those and the index returns will be way higher".

People put $100k into an IUL and its at $20k after 3 years. Instead of a $20k target it had an $80k target. How that agent slept at night I have no clue... literal stealing imo.

But they signed the 50 page illustration that showed them the performance at that level with current rates. They might not have looked at it... but they signed the signature page. Sh*t out of luck.

 

[ATM]

I have never seen an expense report that shows guaranteed expenses.

Ive always had to go to the specimen policy to find the ratio of current/guaranteed, then work backwards to "best guess" the total.

Certainly not exact, but in general, if you know guaranteed expenses are 50% more, you can plan around that and run illustrations with that reduction in mind.

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An IMO or Carrier adding the expense report to an illustration without being asked?!

The thing about guaranteed expenses is that the carriers do not have carte blanche to simply raise those charges to the maximums. They have some leeway but not total.

To get to the maximum charges, the carrier has to petition the state insurance departments to allow for it and the only way that's happening is in a situation where the carrier is going under.

Now that doesn't mean the carrier cannot raise charges without that state approval. They can. But the big charge is COIs, especially in later years, and the current COIs v. the max COIs are multiples higher on the guaranteed basis.

 

[scagnt83]

The thing about guaranteed expenses is that the carriers do not have carte blanche to simply raise those charges to the maximums. They have some leeway but not total.

To get to the maximum charges, the carrier has to petition the state insurance departments to allow for it and the only way that's happening is in a situation where the carrier is going under.

Now that doesn't mean the carrier cannot raise charges without that state approval. They can. But the big charge is COIs, especially in later years, and the current COIs v. the max COIs are multiples higher on the guaranteed basis.

All they have to show is that the increase in expenses is not for the purpose of increasing carrier profits. That is the only real benchmark. Which means they can easily increase expenses on most any policy... especially in an inverted interest rate environment.

Plenty of IULs have seen increases in expenses and COI over the past decade.