I’m not in favor of IULs.

[REI_Velocity]

How would a House bill like that also get passed by Democratic controlled Senate & signed by a Democratic President that both just approved it a few months ago?

Political gamesmanship isn't so much about passing bills, but stalling them at times.

 

[scagnt83]

In his mind, I think he believes if the S&P started at 1,000 on 1/1/xx & 5 years later it is back to 1,000 on 12/31/ 5years later, that the policy holder got 5 consecutive 0. In reality, they could have had 1 0% in a huge negative 40% sell off year & then gotten 4 consecutive cap years of 8-10% each.

Market crashes are the best thing in the world for index policies. He acts like agents have only sold them the past 5 years. I have 15 year old IULs on the books that have seen multiple years of 0% returns.

He also acts like the expenses are a big deal. WL has MUCH HIGHER expenses than IUL does, especially in the first 20 years of the policy. And IUL averages well below 1% of CV in old age.

The biggest risk to IUL are renewal rates..... which he has not even mentioned once.... lmao

 

[REI_Velocity]

You obviously have never stress tested an IUL using the illustration system.

Your OPINION is wildly off base and has zero facts to back it up.

There are IUL policies that have seen multiple years of zero returns. The sky didnt fall. Still humming away like planned. You forget that IUL returns are not based on calendar years.

You need to properly analyze and learn a product before you make factually incorrect statements about it on a public forum.

I'm still waiting on you to produce me one that passes your sniff test. The thing with a lot of IUL promises is just that, it's a lot of talk.

The other thing I ask IUL agents is, "how much money do you put into it?" That often adds realism to their claims.

 

[Allen Trent]

The biggest risk to IUL are renewal rates

I think the other 2 biggest risks are

1. proper design by agent for max funding, not max compensation------------seen way, way too many of the max compensation ones whether UL, IUL, VUL, WL

2. Client actually sticking with the entire plan of both funding & also not bailing on it in old age after bleeding the cash value for supplemental retirement distributions. I can just imagine long decades after agent that wrote the policy is gone, the client getting statements (whether WL or IUL) & seeing horrible looking annual statements going backwards in values due to maxxed out loans. If they are not vigilant to keep them active, it will trigger the massive 1099 because of the loan compounding, etc. That is one of my biggest fears for clients is not remembering the plan & no agent or carrier reminding them not to cancel/surrender it.

 

[REI_Velocity]

Some of the IULs that illustrate the best use a 10 or 15 year cumulative floor. But the best illustrating IUL is not necessarily the best choice for a client... usually is not, especially these days in a market full of non guaranteed multipliers and hybrid indexes.

Exactly. It's a crap shoot. The ones that look really good on paper can't be trusted, so honest agents will write inferior looking ones to offset the smoke and mirrors, which is all just based on future "what ifs" and really just hoping and praying the agent is correct. To me it defies the purpose of doing these policies when we constantly leverage the cash value (another issue with IUL and how loans can affect them.). Again, my goals may not be yours.

 

[Allen Trent]

Political gamesmanship isn't so much about passing bills, but stalling them at times.

the inflation reduction act was passed by both chambers of congress & signed by Biden a few months ago. How can Republicans with a very slight majority in the house in a few weeks stall a bill that already was enacted into law?

 

[REI_Velocity]

In his mind, I think he believes if the S&P started at 1,000 on 1/1/xx & 5 years later it is back to 1,000 on 12/31/ 5years later, that the policy holder got 5 consecutive 0. In reality, they could have had 1 0% in a huge negative 40% sell off year & then gotten 4 consecutive cap years of 8-10% each.

Yes, it's based over a number of years but it's still just insurance company options in the market. The insurance company won't lose before it's customers do. Not sure how any of this would make me a comfortable client. I mean, maybe someone talked into paying 300/mth and not touching it could try it out, but what about people putting in 100k or more a year who want to use loans to invest? And again, it's all based on what could happen, but the absolute worst could happen just as easily. There is someone else in the drivers seat. The true stress test will be this year moving forward with all the fake economics out there. It should be an interesting time, but one I think properly structured WL products will weather just fine.

 

[Allen Trent]

Exactly. It's a crap shoot. The ones that look really good on paper can't be trusted, so honest agents will write inferior looking ones to offset the smoke and mirrors, which is all just based on future "what ifs" and really just hoping and praying the agent is correct. To me it defies the purpose of doing these policies when we constantly leverage the cash value (another issue with IUL and how loans can affect them.). Again, my goals may not be yours.

How is that different than one of the prime benefactors of infinite banking, etc (Ohio National) basically eliminating dividends on WL after selling off to a Canadian Pension fund or the other half dozen WL carriers that completely quit selling Life insurance all together. it is a crap shoot for all products based on 50-100 years of what you believe the carrier will do & how the fixed interest rate market place will function.

Again, I own mostly WL & GUL myself, but I wouldnt have any issue if I was insurable to buy IUL today that I design for myself or my kids. helped agents issue almost $1M of IUL on 70 cases this year, $7M of term/WL & about $15M of SPWL.

one is not better than the other. Client needs/wants should dictate what the solutions are for that specific client, not yours or my personal affection for our own purchases or in most cases the producers use of only a hammer as a tool because they have chosen to only have a hammer in their toolbox

 

[REI_Velocity]

Market crashes are the best thing in the world for index policies. He acts like agents have only sold them the past 5 years. I have 15 year old IULs on the books that have seen multiple years of 0% returns.

He also acts like the expenses are a big deal. WL has MUCH HIGHER expenses than IUL does, especially in the first 20 years of the policy. And IUL averages well below 1% of CV in old age.

The biggest risk to IUL are renewal rates..... which he has not even mentioned once.... lmao

If you're bragging about 0% years then in no way did your IUL perform as illustrated. THIS is my point. The biggest question is 30 yrs from now. Your IULs haven't been tested yet in a full life span. We already know they aren't performing as illustrated… and that's on the front end of things.

And yes, I did mention renewal rates early on in this thread. That's a huge deal… was it you or someone else who gave the example of the 90 yr old and cash value compensating for a cheaper insurance cost?

The thing with WL is you know up front what the future holds. No 11th hour grenade drops.

 

[DHK]

I'm still waiting on you to produce me one that passes your sniff test. The thing with a lot of IUL promises is just that, it's a lot of talk.

The other thing I ask IUL agents is, "how much money do you put into it?" That often adds realism to their claims.

Here's the problem and I get this with Primerica agents and the financial entertainers (like Dave Ramsey and Suze Orman) who trash talk ALL life insurance policies but term:

You're talking product. It's EASY to trash-talk product. Every product has their weak points and weak people who sell them.

Here's what I believe: the product structure reflects the quality of the agent who sold it.

I don't trash talk products. Not anymore.

I look at the product as a reflection on the agent. Then I criticize how the agent SHOULD'VE done it.

I also believe that there's a place for every kind of product (that's legal and approved for sale). I also believe that the more open-minded we are, the more we can find ways to use these products in the most ethical ways we can.

For example, I'll reference the post I made earlier in this thread about PPLI. I'm a complete novice on this, but I'm learning from one of the world's experts on it... and it's a term or GUL wrapper to do these. But if I'm too closed-minded, I may miss opportunities.

So I do have a belief. I do prefer limited pay whole life for the work I do. But I'm not opposed to using IUL. And seeing the number of mutual companies shrinking... it may not be long until we're ALL selling IUL.

Just my thoughts.