Definitions: Whole Life Insurance Vs Permanent Life Insurance

[Robert Barney]

Re: Definitions: Whole Life Insurance Vs Permanent Life Insuranc

Here is a presentation thats accessible through LFGs web portal, its a presentation from national underwriters though.

Its called "Understanding Life Insurance". Its an ok presentation, your question is answered on page 6.... I would suggest you read the whole presentation though...

OH THAT was very helpful.

scagnt83 has now introduced the term CASH VALUE INSURANCE into a thread defining the difference between the terminology "permanent life insurance" and "whole life insurance".

I searched the entire document that scagnt83 posted for the word "permanent" and it is not to be found. GREAT! Perhaps scagnt83 would be so kind as to identify who published this thing? LFG - what is that? I find it hard to believe that someone like that is publishing a document like this without any reference to the author or the full name of the publisher.

As to needing a license to comment on life insurance, that's just an excuse not an objection for not addressing the topic at hand. If you think I am breaking the law, feel free to report me. I haven't had some press in a while, and I could use some.

Apart from that, watching you guys try to define the terminology is underscoring the fact that you are all skating harder than an NHL team.
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I don't know what IANAL means, but whatever. If I were you, I would think twice about hitching your life insurance wagon to Robert. He's been unlicensed since '97 and gets mixed up when it comes to Universal Life and Whole Life. I do agree with Robert on giving clients maximum coverage, however. So he's not totally off his rocker. But at the end of the day, if you're comfortable receiving advice from someone like, say, Rick, I think that's the way to go.

You could try being a little more genuine.

I have defined whole life in the way I understand it, and the way many, many others understand it. It is life insurance in force for the "whole" of your life. Now that is the way it was taught to me, and I can find lots and lots of references on the web that prove I am not isolated in using that definition.

Now I am giving you guys a sincere opportunity to set me straight on definitions, but you are not trying to do that, you are trying to bob and weave and avoid pinning your own definitions down. And does everyone else agree with your definitions?

How about someone dig up an electronic copy of a current licensing manual for one of the 50 states, where the basics of this are explained. Give us a link to it here and let's see what it says.

 

[scagnt83]

Re: Definitions: Whole Life Insurance Vs Permanent Life Insuranc

OH THAT was very helpful.

scagnt83 has now introduced the term CASH VALUE INSURANCE into a thread defining the difference between the terminology "permanent life insurance" and "whole life insurance".

Ok. So it said Cash Value, instead of Permanent... any *** can fill in the blanks. Any form of Permanent Insurance is Cash Value Life Insurance, and vice versa.

I attached that as more of a guide for you to go by highlighting differences and illustrating the fact that "Whole Life" is a separate and specific product, not a broad term for all policies that are in force permanently.

Page 6, while not using the term permanent, does illustrate the fact that WL is not just some broad term.
If something as small as the term "cash value life insurance" throws your logic off, then its a good thing you dont have your insurance license anymore....

But it seems to me that now your just on a crusade to prove your point, when anyone who knows anything about life insurance knows that your wrong.


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Perhaps scagnt83 would be so kind as to identify who published this thing? LFG - what is that?

I did identify who published it. National Underwriters. I said that I accessed it through LFG (which is Lincoln Financial Group).

Its a non branded presentation for broker use.

I would post the chapter on WL and the chapter on UL from the "tools and techniques" series from National Underwriters for you, but I doubt you would take the time to read it.
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I have defined whole life in the way I understand it, and the way many, many others understand it. It is life insurance in force for the "whole" of your life. Now that is the way it was taught to me, and I can find lots and lots of references on the web that prove I am not isolated in using that definition.
.

Just because you find people on the web saying this, doesnt make it true. You have used random webpages and articles from non professional sources many times on this forum in trying to validate a position of yours.

Using crackerjack web references to prove yourself shows gullibility/ignorance

 

[Death Cab For Tootie]

Re: Definitions: Whole Life Insurance Vs Permanent Life Insuranc

OH THAT was very helpful.

scagnt83 has now introduced the term CASH VALUE INSURANCE into a thread defining the difference between the terminology "permanent life insurance" and "whole life insurance".

I searched the entire document that scagnt83 posted for the word "permanent" and it is not to be found. GREAT! Perhaps scagnt83 would be so kind as to identify who published this thing? LFG - what is that? I find it hard to believe that someone like that is publishing a document like this without any reference to the author or the full name of the publisher.

As to needing a license to comment on life insurance, that's just an excuse not an objection for not addressing the topic at hand. If you think I am breaking the law, feel free to report me. I haven't had some press in a while, and I could use some.

If you think I'm going to give you some pub based on this, you're sadly mistaken. But giving case-specific advice to a consumer without a license is illegal and you know it.

Apart from that, watching you guys try to define the terminology is underscoring the fact that you are all skating harder than an NHL team.

I've clarified several times what the definitions are. For the last time: Whole Life gives guaranteed death benefit, premium and cash surrender value. Guaranteed Universal life gives guaranteed death benefit and premium. It does not give guaranteed cash value. Both are forms of permanent life insurance. I don't know how much more clear I can be.
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You could try being a little more genuine.

I have defined whole life in the way I understand it, and the way many, many others understand it. It is life insurance in force for the "whole" of your life. Now that is the way it was taught to me, and I can find lots and lots of references on the web that prove I am not isolated in using that definition.

Yes, I've heard permanent insurance being called Whole Life insurance because you pay "for your whole life and get coverage for your whole life". It doesn't mean it's not an inaccurate statement.

Now I am giving you guys a sincere opportunity to set me straight on definitions, but you are not trying to do that, you are trying to bob and weave and avoid pinning your own definitions down. And does everyone else agree with your definitions?

You can't be serious. I've given my definition several times. It happens to be the correct definition. You continue to ignore it. But who cares? You're not licensed, so you don't have to answer to anyone when you give the wrong info out. Fantastic!

How about someone dig up an electronic copy of a current licensing manual for one of the 50 states, where the basics of this are explained. Give us a link to it here and let's see what it says.

I can't find a link to a state's licensing manual at 2 in the morning, so it's going to have to wait. Rest assured, I know for a fact that permanent life insurance is broken down into WHOLE LIFE and UNIVERSAL LIFE. They are different and not interchangeable terms. These are my definitions. You can pin me down on them. I'm not trying to "bob and weave" as you so put it.

Clear enough?

 

[Newby]

Re: Definitions: Whole Life Insurance Vs Permanent Life Insuranc

Robert you had me doubting myself but I checked in my CLU coursebook and it states that whole-life insurance MUST guarantee the cash value be equal to the face amount at some guaranteed point.
Universal Life is it's own catagory of life insurance.

 

[xrac]

Re: Definitions: Whole Life Insurance Vs Permanent Life Insuranc

Is whole life insurance permanent insurance, and is permanent life insurance whole life insurance?

Whole life insurance is permanent. Not all permanent life insurance is whole life insurance.

Is Universal Life whole life insurance?

Absolutely not.

Is Universal Life permanent life insurance?

Absolutely it is.

What say you?.

You are spot on.

 

[Robert Barney]

Re: Definitions: Whole Life Insurance Vs Permanent Life Insuranc

Ok. So it said Cash Value, instead of Permanent... any *** can fill in the blanks. Any form of Permanent Insurance is Cash Value Life Insurance, and vice versa.

This one got me laughing.

Death Cab do you want to handle this or do I have to continue being the bad cop?
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Robert you had me doubting myself but I checked in my CLU coursebook and it states that whole-life insurance MUST guarantee the cash value be equal to the face amount at some guaranteed point.
Universal Life is it's own catagory of life insurance.

Cash value = face amount is endowment and traditional, non-par whole life endows at age 100.

I would also agree that traditional Universal Life is NOT permanent life insurance in that you can tailor it to lapse before you die. Underfund it and it is toast.

And you can have a no lapse guarantee that is much less than the lifetime of the individual. For example, Genworth has rolled out Term UL, which is a UL product with term like guarantees for 10, 15, 20 or 30 years - definately not permanent insurance. West Coast offers all kinds of no lapse UL scenarios for ages that end well before a person's lifetime. None of that is permanent insurance.

On the other hand, I would argue that no lapse UL with a guaranteed face/premium to age 121 is permanent insurance simply because you can't outlive the coverage.

So when comparing to traditional whole life, you can buy a no lapse UL paid to 100. Same thing only different.

I can't imagine anyone living to age 100 wanting to take the endowment value of their traditional whole life policy simply because of the tax consequences. I know that in Canada people living to 100 could leave their policy as "paid up" and the face amount actually went up each year after age 100, and didn't create a taxable benefit while alive.

Is that the case in the U.S., or are you forced to declare the proceeds at age 100 if you are still alive? If so, then I would think you would agree with me that no lapse UL, paid up at age 100 has a distinct advantage over that.

 

[BNTRS]

Re: Definitions: Whole Life Insurance Vs Permanent Life Insuranc

Doesn't anyone here remember that UL was often called univeral whole life insurance around the time it started showing up and well into the 90s.

It's kind of a play on words, that UL could (if missing secondary guarantee) last for ones whole life.

But...

As many other's have pointed out, there are very distinct differences between Whole Life insurance and Universal Life insurance.

Yes both are considered permanent types of insurance, both are considered cash value types of insurance (not reall important, but I'll mention it anyway)

However, Whole Life insurance has a guaranteed charge for mortality, expenses, and rate of return, established at inception. UL does not, that was the major change upon it's creation--we'll offer higher returns, but we are going to lay more risk on the insured.

Also, as has been pointed out, WL is designed to endow at age 120 (formerly age 100), where guranteed death cash value must equal guaranteed death benefit. This is not the case with UL. It can equal this amount, but there is no requirement that it do so.

Robert is correct in remembering that the phrase Universal Whole Life insurance used to be used frequently, and is still sometimes found today.

But traditionally today Universal Life and Whole Life insurance mean two completely different things, though both are a form of permanent insurance.

Personally, I've always had a tough time referring to plain UL as permanent insurance, as it's not necessarily the case.

 

[Robert Barney]

Re: Definitions: Whole Life Insurance Vs Permanent Life Insuranc

You are spot on.

OK, that's one vote for Death Cab's definitions although it looks to me like Universal Life cannot/should not be in his Permanent category based upon newby's observations.

Do you agree or disagree.

And is xrac or Death Cab going to straighten scagnt83 out?

 

[VolAgent]

Re: Definitions: Whole Life Insurance Vs Permanent Life Insuranc

Universal life is definitely a form of permanent insurance, but it is not a form of whole life insurance.

WL, VUL, UL, GUL, IUL are all forms of permanent insurance.

Additionally, most WL is now designed not to mature or endow yet to solve that tax problem. It still works exactly the same as before, except the company holds onto the money at age 121 until death. Now, I don't know if the cash value continues to build and dividends continue to be paid at that point, but I would assume so.

 

[Death Cab For Tootie]

Re: Definitions: Whole Life Insurance Vs Permanent Life Insuranc

Originally Posted by scagnt83
Ok. So it said Cash Value, instead of Permanent... any *** can fill in the blanks. Any form of Permanent Insurance is Cash Value Life Insurance, and vice versa.

Technically, he's correct. Both WL and UL can have CSV. GUL will not have CSV. More specifically, a chart of the growth of the cash inside of a GUL will look like a bell curve. There is some during the middle parts of the policy, but the expenses take over and erode whatever cash is inside the policy. With WL the CSV goes in a straight line up.

However, my point was to clarify your definitions. Universal Life insurance is NOT Whole Life insurance. The chassis are different, they work differently, and have different functions.