I’m not in favor of IULs.

[REI_Velocity]

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.

That's fair and I largely agree. I just find it interesting when talking with people who claim his IUL is WL on steroids won't produce the illustration (privately). I want to learn more as well and want to clear blind spots. Thus far, in my research I haven't been impressed at all with IUL. I'm willing to be persuaded otherwise.

My first intro to IUL was at a Starbucks appointment in 2014 (I was the client) and the agent touted how well he does and his many years of experience. He then went on to tell me how the Rockefellers used IUL, and then used WL soundbites, like, Walt Disney and JC Penney used loans from their "IULs." I didn't know much about the topic at the time. Last I checked he's the VP of an insurance brokerage in a large city. He was trying to sell me on a 13k a year policy. Suffice it to say, that's when I started my quest researching on the topic and found out how IUL first came about around 1997. I do not like unscrupulous agents who would sell a life long product to someone for a nice payday. If the agent isn't aggressively doing what he's selling then I'd walk.

I think some agent's slogans should be, "What I'm selling you is SO GOOD that not even I will put my money in it!!"

 

[Lloyds of Lubbock]

Then I criticize how the agent SHOULD'VE done it.
It is very easy to criticize another agent, but remember you were not in the room.
You did not hear the conversation between the client and the agent.
You may hear the clients version of it but that version is like a pancake...no matter how thin you make it...it still has two sides.

 

[REI_Velocity]

Then I criticize how the agent SHOULD'VE done it.
It is very easy to criticize another agent, but remember you were not in the room.
You did not hear the conversation between the client and the agent.
You may hear the clients version of it but that version is like a pancake...no matter how thin you make it...it still has two sides.

I was the client in the above story. As an agent now, I've also seen a ton of bad policies.

 

[DHK]

Then I criticize how the agent SHOULD'VE done it.
It is very easy to criticize another agent, but remember you were not in the room.
You did not hear the conversation between the client and the agent.
You may hear the clients version of it but that version is like a pancake...no matter how thin you make it...it still has two sides.

Always a fair point.

But some agents actually set up their IULs on a minimum-funded (or at least 'less than target') basis.

It goes like this: "Can you afford $100/month today? Okay, do you think in a couple of years, you could increase that to $250/month? We'll set it up so you can do that in a couple of years, but we'll get started with $100/month now."

Then the unspoken part goes like this: "Good luck finding me when I fail out of the business and don't remind you to increase your contribution to the policy as was originally agreed."

So it can really depend on how the expectations were established in the beginning... and not all expectations were good.

 

[Lloyds of Lubbock]

I was the client in the above story. As an agent now, I've also seen a ton of bad policies.
Let me ask you a question....how long have you been in the business?
The how much can you afford sale happens a lot....unfortunately.
But what also happens is that a client says I will start with this and then step up the funding which never happens.
All I am saying is before you condemn, make sure you understand the whole picture.

 

[Allen Trent]

Always a fair point.

But some agents actually set up their IULs on a minimum-funded (or at least 'less than target') basis.

It goes like this: "Can you afford $100/month today? Okay, do you think in a couple of years, you could increase that to $250/month? We'll set it up so you can do that in a couple of years, but we'll get started with $100/month now."

Then the unspoken part goes like this: "Good luck finding me when I fail out of the business and don't remind you to increase your contribution to the policy as was originally agreed."

So it can really depend on how the expectations were established in the beginning... and not all expectations were good.

Completely agree, but I see that also happen to a lesser extent with WL & PUAR. Set it up now with larger base face than needed, based on client being able to afford more later & plan to utilize PUAR to a greater extent later. Client & agent all forget & almost all premium is going into base policy & minimum PUAR to keep the door open for more PUAR.

While it won't perform near as good as max PUAR up front, at least the base policy will be ok & won't have near the negative consequences of the UL/IUL setup with plans to be able to pay more later.

My thought is max fund what you can now, buy some convertible term if you hope to be able to do more funding later. Don't make the permanent bucket bigger now based on the long shot more committed funding will appear later.

More often than not, not only does the increased funding not come around, but more common is the client wanting to back down funding when life happens like lifestyle creep, divorce, car/house/vacation/toy envy, etc.

 

[Lloyds of Lubbock]

"buy some convertible term if you hope to be able to do more funding later. Don't make the permanent bucket bigger now based on the long shot more committed funding will appear later.
+1

 

[scagnt83]

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.

Im still waiting on you to address the facts I provided initially.

If you dont know what the difference between GPT and CVAT is, looking at an illustration is useless. You dont even know the basics yet you want to argue about pros/cons.

 

[scagnt83]

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.

That is why its your job as an agent to actually understand the product and how it works.

You realize why those illustrations are bs and what illustrations are not bs. You educate the client on why the best looking illustration is not necessarily the best option for their needs. That is your job.

Its no different than WL. 99% of WL policies on the market do not fit the needs of someone looking to max out CV. Its your job as an agent to weed out the bs and present the best options.

IUL is no different, its your job to weed out the bs and present the best options. You just dont understand the product, so you are incapable of doing so.

You could have gained an understanding of the product by asking questions. Instead you make false statements out of fear and ignorance.

 

[REI_Velocity]

I was the client in the above story. As an agent now, I've also seen a ton of bad policies.
Let me ask you a question....how long have you been in the business?
The how much can you afford sale happens a lot....unfortunately.
But what also happens is that a client says I will start with this and then step up the funding which never happens.
All I am saying is before you condemn, make sure you understand the whole picture.

Again, I was the client in that scenario. He literally lied about the history of IULs.

But generally speaking, yes, there is always a context.