IUL Organizations
- Thread starter BrianRios
- Start date
- 15,041
IULs are the next insurance fiasco, mark my words. If this forum is any indication, there are way too many people jumping on this product without a clue.
- Thread starter
- #3
Yep. It's going to be a total debacle, which is sad because I think IUL can be a good fit for some folks.
If you want to have some fun, listen to the Q & A at the end of an IMO or carrier webinar on this product. You will either laugh or cry.
- 15,041
It was nothing personal, just an observation on where things are going. Learn about life insurance in general. Then you'll see where an IUL is an appropriate solution.
x2. Bring on the regulatory scrutiny...
- 10,318
IULs commission structure is no different than any other UL.
And per premium dollar it probably pays the lowest of all ULs on average.
Clients usually contribute more premium to IULs vs. a typical UL if they are using it as extra savings; but if the policy is designed correctly its overfunded and the target is much loweer than the actual premium.
Per premium dollar, GUL probably pays the most; and would be an excellent product for a FE guy to get their feet wet in the UL world with.
Any IMO that is pushing IUL real heavy I would be leery of. Especially if they are marketing it as "big commissions" or as "a 401K alternative" or as "the ultimate tax free retirement savings".
You need a well rounded IMO that can teach you not just IUL, but about ALL UL & WL products. It is impossible to know suitability if you do not know the other possible solutions.
And if the IMO says that everyone is a candidate for IUL then thats not helping much at all.
Also, to market & sell just IUL would make you have a very limited clientele..
Join ILIAA and they can teach you some basics. Find an IMO that has decent training available.
But dont be "that agent" that goes and markets the most complicated UL product out there, because it "pays really good" when you dont have a clue about it! Ultimately thats bad for you, the client, and my industry.
All UL products "pay really good" so does WL & term; its just a matter of whats suitable for the client.
I will say that Brokers Alliance seems to have a decent understanding of IUL; this is judging from his posts on here.
Next Generation Financial has IUL products and a knowledgeable staff.
Both of those along with ILIAA, would be a good start.
- 15,041
Rick over at TGP has often said that agents who push UL products as better than WL are bad at math. I'd take it a step further, and say they are bad at math or unethical.
The ethical agents who push UL over WL are bad at math. If you put enough premium into a cash accumulation UL to make it perform, you're at or near WL premium. They'll perform fairly close. The UL should do a little better, but the WL will give more guarantees. Oh, and the WL will pay better.
The unethical agents just make sure the premium hits target to get the maximum commission and don't care if the product can support itself.
Feel free to flame on. I'm not saying that UL is bad and WL is good. I'm bashing the agent who believes UL is the answer to everything, just as I would the agent who believes WL is the answer to everything.
The ethical agents who push UL over WL are bad at math. If you put enough premium into a cash accumulation UL to make it perform, you're at or near WL premium. They'll perform fairly close. The UL should do a little better, but the WL will give more guarantees. Oh, and the WL will pay better.
The unethical agents just make sure the premium hits target to get the maximum commission and don't care if the product can support itself.
Feel free to flame on. I'm not saying that UL is bad and WL is good. I'm bashing the agent who believes UL is the answer to everything, just as I would the agent who believes WL is the answer to everything.
Brad W.
New Member
The unethical agents just make sure the premium hits target to get the maximum commission and don't care if the product can support itself.
Soooo TRUE.
Soooo TRUE.
- 958
All permanent forms of life insurance fall into two planning categories: indemnification and income. Indemnification covers an exposure to liability, whether temporary or permanent. I don't want to pay any more for life insurance than I want to pay more for home, auto, PUPs, etc. So I like GUL offered by a strong balance sheet carrier becasue the guarantees in the policy are only as good as the company issuing the contract. I'd consider WHL, but it generally it costs more.
I do consider WHL for income scenarios when the assumed crediting rate for current assumption UL, VUL or IUL falls to 6%. Carriers like Mass Mutual are major players in long term funding scenarios. Their numbers are impressive, with decent historical returns and a big financial balance sheet. When the crediting rate goes higher to 7-8% I consider IUL. NACOLAH is a major player here. And when an aggressive client has the stomach for beta risk...looking for 15% returns I look at VUL. I'm looking at several players here, but in my opinion the beta risk and expense loads are way to high to play with VUL.
In all long term funding income scenarios I purchase the lowest non MEC death benefit option B switching to A as soon as the "force out rule" allows and then drop the death benefit to the minimum DEFRA corridor to reduce COIs expenses at every opportunity. And since most of these income scanerios are non quailifed I generally use a female becasue her COI charges are less and underwriting is more favorable with women.
The goal is a lifetime average annual expense load below 100 basis points, all in. When it's done right Orman and Ramsey have nothing to say.
I do consider WHL for income scenarios when the assumed crediting rate for current assumption UL, VUL or IUL falls to 6%. Carriers like Mass Mutual are major players in long term funding scenarios. Their numbers are impressive, with decent historical returns and a big financial balance sheet. When the crediting rate goes higher to 7-8% I consider IUL. NACOLAH is a major player here. And when an aggressive client has the stomach for beta risk...looking for 15% returns I look at VUL. I'm looking at several players here, but in my opinion the beta risk and expense loads are way to high to play with VUL.
In all long term funding income scenarios I purchase the lowest non MEC death benefit option B switching to A as soon as the "force out rule" allows and then drop the death benefit to the minimum DEFRA corridor to reduce COIs expenses at every opportunity. And since most of these income scanerios are non quailifed I generally use a female becasue her COI charges are less and underwriting is more favorable with women.
The goal is a lifetime average annual expense load below 100 basis points, all in. When it's done right Orman and Ramsey have nothing to say.
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