Is this agent's explanation of my whole life policy accurate?

[Charlielor]

I have an IUL agent who wants to sell me an IUL policy and asked to look at my current whole life policy. When he's looking at my current policy, he looked at the "guaranteed" column and said my policy will laps at age 54 since I did not pay the target value and there is simply not enough cash value to keep the policy afloat until age 120. On the "non-guaranteed" column, he said the policy will laps at age 62 with same reason. So if I died after age 62, my "guaranteed" face value amount on the policy will be zero unless I keep paying the high premiums after age 62 to keep the policy going. Is this a fair and accurate assessment of my whole life policy? Thank you.

 

[Todd King]

If there is a "target premium" with your existing policy,it's now WL, it's a UL product.

WL does not implode like a UL will.

Go back and look at the front of your policy. Down at the bottom (usually), does it say Flexible Premium or something to that affect? If so, it's UL

 

[Baseball7]

Whole life doesn’t lapse as long as premiums are paid sounds like the guy is talking out his ass to make a sale.

 

[Charlielor]

I'm sorry Todd is correct. It's UL. At the bottom of the first of the illustration page, it says this. Does this mean based on the guaranteed assumptions there is no laps until 8/12/2096 with the current payment?

 

[Lloyds of Lubbock]

How old are you?
How old is the policy?
Is the information regarding lapse dates based on a current inforce illustration?
If not before you do anything I would suggest you get an inforce policy showing you the premium necessary to guarantee the coverage at least to 100.

 

[Charlielor]

I'm 45. The policy is about 8 years old. Yes, the information is based on current inforce illustration.

 

[shooter]

Charlie, why do you have the coverage?
What problem does it solve for you?

Knowing that, I am sure one of the professionals
here could give you some good advice.
Shooter

 

[scagnt83]

I'm sorry Todd is correct. It's UL. At the bottom of the first of the illustration page, it says this. Does this mean based on the guaranteed assumptions there is no laps until 8/12/2096 with the current payment?
View attachment 7704

Yes. This means if you pay the current premium, your policy is Guaranteed not to Lapse until the year 2096. That is regardless of any interest rates adjustments, expense increases, index returns, etc. Pay the premium, the DB will be guaranteed until age 2096.

The agent is is selling you a load of bs. At least to the extent of the policy lapsing.

Now... the potential issue is the purpose you own this policy. Is the DB your only concern? Or did you buy it for CV accumulation? Because a UL or IUL with a "no lapse feature" will keep the DB intact regardless of the CV. So the policy "not lapsing" could be a very different conversation vs. what your actual expectations are of the policy you bought.

 

[Charlielor]

The purpose I purchased this policy is not for investment, cash value, or loaning my own money. The sole purpose is to guaranteed to my beneficiaries that when I'm gone, they got the face value of the policy that was initially promised to me when I purchased and continuing to pay the premium that is due monthly.

 

[scagnt83]

The purpose I purchased this policy is not for investment, cash value, or loaning my own money. The sole purpose is to guaranteed to my beneficiaries that when I'm gone, they got the face value of the policy that was initially promised to me when I purchased and continuing to pay the premium that is due monthly.

What that screenshot is showing is that if you pay the planned premium, for the life of the policy, it will not lapse until year 2096.

If you planned on stopping premiums at a certain age, then that calculation is not relevant. You need to have an "inforce" illustration run to show the projected values based on the current point in time.

What is that screenshot from? The original sales illustration? Or a recent statement?

What time period do you plan on paying premiums for? If its for the life of the policy then you are fine.