Justifying a Whole Life Policy

[LGilmore]

And actually I haven't called you ignorant in that prior post either. I chastised you for b itching about UL in a WL thread. I think I did slip in this one maybe because it's the second time I am asking why complain about UL in a WL thread?

 

[Larry Tew]

Everything that I could comment on this has already been done so by me more than once. I'm not going to keep typing the same thing over and over when all you have to do is comprehend better.

Yeah, I'm sure that's the answer. It would have been nice if you could have addressed my 70-year old example and enlightened me on how I damaged him for filthy immoral gain, but as is your pattern, you never seem to address posts from a factual basis.

Consider that your misguided position may be costing you and the people you say you're trying to help. I'm not interested in more back-and-forth about this with you, so if you want a final word, go for it.

 

[scagnt83]

A UL is totally capable of being contractually Guaranteed. Just like a WL Policy. Not all are, not all are designed to. But just because you have a rising COI does not mean it cant be guaranteed.

As Ive pointed out a GUL is extremely similar to an FE policy. If you pay the premium its guaranteed to age 121. If you dont it lapses.

Same with a UL that is Guaranteed to a certain age on the Guaranteed Column.


Also, a UL has more than just 2 parts. It also has a DB Option that is changeable and a GPT or CVAT method of testing. Both can dynamically effect the policy, admin charges, & COI. (and guarantees)



Jerard. You have proved you are incapable of having a logical and professional discussion.

I provided the facts. Even provided references for them. Yet you say they "mean nothing".

In previous threads I pointed out your inaccuracies. Go back and read them if you really care.

You refuse to have an adult discussion or either are not capable of it.

Ive wasted enough time on this nonsense.

FE policies statistically have done more harm to consumers than ULs have. (according to the industry leading research you dismissed as meaningless)

A professional does not listen to wikipedia and dismiss top research firms like LIMRA. At this point you are just making yourself look more and more bias and misinformed.

 

[rousemark]

Jerard, if you understood the products, you would realize they ALL can break if not used properly. I and others have posted enough educational material over time that all one has to do to gain a more complete understanding is to simply READ the material. but you would rather stick your fingers in your ear singing "LaLaLa" to drown out the information.

If this sounds harsh it's because I meant it to. I wouldn't have commented on your posts in this or the other thread until you played the "morals" card. You as much as said anyone who sold a UL lacked morals and cared only about the commission even if it hurt the client.

Here's why I use UL when it fits. Last month I had a 70-year old who had to convert his 10-yr term. I showed him a couple of WL plans with monthly premiums of $380, $460, and $660. Each had its own set of benefits.

He needed the premium to be around $275. I showed him UL at $260. He understood it may not last forever and that it never paid up - reduced or otherwise. But being FULLY INFORMED, he chose the UL.

If I had a crystal ball and knew when he was going to die, I might could have made a better recommendation, but that's not how it works.

Larry; just curious what company you used.. Many ULs now have the reduced paid insurance as a non forfeiture option.

 

[Larry Tew]

Larry; just curious what company you used.. Many ULs now have the reduced paid insurance as a non forfeiture option.

Ohio National. It was a term conversion and he was super-preferred. Including the term conversion credit along with the rate class, it was his best option.

 

[Jerard]

It would have been nice if you could have addressed my 70-year old example and enlightened me on how I damaged him for filthy immoral gain, but as is your pattern, you never seem to address posts from a factual basis.

Show me what facts I have stated that are incorrect. Quote me, then produce what you have in opposition. Anything would work. A copy of a policy. A reputable website that defines the components of a UL differently than I have stated. I doubt you could even show me a photo of spray painted wall that says that a UL is made of anything OTHER than ART and an interest dependent cash value. What I have stated is factual. You have offered none.

As far as your 70 year old goes I think you did the right thing. I have already stated several times that those of you that sell UL's the right way by informing the client about the limitations are not to blame. If the 70 year old knows that it may not last until he dies then you did the right thing by him.

Consider that your misguided position may be costing you and the people you say you're trying to help. I'm not interested in more back-and-forth about this with you, so if you want a final word, go for it.

The only way my position can be "misguided' is if you can show me any UL that is contractually guaranteed. Upload a policy scan. If you don't want to show it publicly then there are other ways you could send it. I have asked all of you for this and I'm still waiting.

I say there is no such thing as a contractually guaranteed UL policy. The only way you can prove me wrong is to show me a contract that states otherwise. Unless and until you can do that then you have not proved anything.

----------

A UL is totally capable of being contractually Guaranteed. Just like a WL Policy. Not all are, not all are designed to. But just because you have a rising COI does not mean it cant be guaranteed. As Ive pointed out a GUL is extremely similar to an FE policy. If you pay the premium its guaranteed to age 121. If you dont it lapses.

OK...show me one. Scan a policy and upload it.

Same with a UL that is Guaranteed to a certain age on the Guaranteed Column.

I have no problem with a UL that is sold showing ONLY the guaranteed rate. However, if the client skips premiums then that guarantee is will no longer be valid. Most, not all, but most agents tell the client they can skip payments and the policy will be "OK".

Also, a UL has more than just 2 parts. It also has a DB Option that is changeable and a GPT or CVAT method of testing. Both can dynamically effect the policy, admin charges, & COI. (and guarantees)

I agree that GPT and CVAT can effect the policy. But they can't change the root components of the policy. Underneath all that you still have ever increasing term with a interest dependent cash value. You can repaint your car but that dosn't change what is under the hood.

Jerard. You have proved you are incapable of having a logical and professional discussion.

I provided the facts. Even provided references for them. Yet you say they "mean nothing". In previous threads I pointed out your inaccuracies. Go back and read them if you really care.

The only thing you have provided is a statistic on how soon one plan lapses over another. You have yet to show anything to show that any UL is either contractually guaranteed or that the root components of the UL is any different than I have stated. I have asked you and others to show any policy that would prove otherwise and as yet none have been provided.

FE policies statistically have done more harm to consumers than ULs have. (according to the industry leading research you dismissed as meaningless)

A professional does not listen to wikipedia and dismiss top research firms like LIMRA. At this point you are just making yourself look more and more bias and misinformed.

I never dismissed LIMRA. Stop making things up. I said that the different lapse rates you sited does not prove that the root components of a UL are anything other than what I have said. That upload was interesting, I saved it for myself. But it doesn't prove that what I have said is wrong.

If you don't like Wikipedia, there are others:

What is Universal Life? definition and meaning
A quote from this site:
"The danger is that falling interest rates may cause premiums to increase and even cause the policy to lapse if interest can no longer pay a portion of the insurance costs."

Retirement Disaster Looms For Universal Life Policyholders - Forbes
A quote from this site:
"But most skipped the fine print, signed the papers, and squirreled them away in their safe deposit boxes where they’ve been for decades. Hidden in those policies was this potential time bomb: if the projected investment returns fail to materialize, the insurance company can make up the difference by reducing the cash value—taking money out of your cash value savings account—right down to zero, if necessary. And when that’s exhausted, they can require the policyholder to make up the difference in the death benefit premiums, or risk the policy expiring worthless."

Universal Life Insurance vs. Whole Life Insurance
A quote from this site:
"Interest rates in this case are a double-edged sword. As with any attractive option, there is an associated risk. In this case, you are betting long-term interest rates will remain where they were when you bought the policy. If rates fall significantly after you purchase the policy, the odds are good that the premium stream won't cover the cost of keeping the universal life insurance policy in force and maintaining the death benefit payable sometime in the future."

Life Insurance Law & Legal Definition
A quote from this site:
"Universal life policies provide individuals with a wider array of investment choices and higher projected interest rates. They are essentially similar to a term policy with a fixed rate of interest guaranteed for a year at a time."

Pros and Cons of Universal Life Insurance - Ask.com
A quote from this site:
"Another possible drawback is, though the policy is permanent, the mortality charge may become more than your premium. As you get older it will get more expensive to maintain the policy. You will, after all, die eventually and the company will have to pay something. The insurance company can use your savings to make up the difference, but that will deplete your investment and if it runs out, the policy can be cancelled."

----------

I tried to find sites that you would approve of, other than Wiki, of course. One thing I noticed in all the sites I went through is that they all say the same thing with regard to the components of a UL policy. Term plus an interest dependent cash value. Ohh...one mentioned the policy fees, my bad.

Once again, and this makes about the 6th time I've asked. Prove me wrong by showing any website that offers a different definition (if a definition is provided) or, show me a contract that says a UL is made up of something other than the 2 components I have said or show me a contract that states it is guaranteed for the life of the client. It can't be done. I know it and you know it. But if all you can do is throw personal insults then have at it if that's all you got. Proof of such:

You refuse to have an adult discussion or either are not capable of it.

 

[sman]

I'm just curious, what does the 'G' stand for in GUL? And when the contract states if you pay x dollars each month your coverage will stay in force until age 121, is that not guaranteed?

 

[scagnt83]

I agree that GPT and CVAT can effect the policy. But they can't change the root components of the policy. Underneath all that you still have ever increasing term with a interest dependent cash value. You can repaint your car but that dosn't change what is under the hood.

This statement shows your lack of knowledge on the subject.

To use your car analogy:
The testing method is not the paint. It directly effects how the engine runs.

GPT uses lower COI.

Can you tell me why that is?

Without researching it do you know exactly how each testing method effects the policy?

 

[Jerard]

I'm just curious, what does the 'G' stand for in GUL? And when the contract states if you pay x dollars each month your coverage will stay in force until age 121, is that not guaranteed?

It's better than the rest, but if agents sell it like other UL's (ability to skip premiums) then that guarantee is voided. Or if they are late on payments.

Citations:
What Is Guaranteed Universal Life Insurance? | eHow
Quote from the site:
"Guaranteed UL policies also have very specific terms that must be met in order for the guarantees to be valid."

And again from Wikipedia: (Reference)
"This guarantee will be lost if the policyholder does not make the premium as agreed, although the coverage itself may still be in force. Some policies do not provide for the possibility of reinstating this guarantee. Sometimes the cost associated with the guarantee will still be deducted even if the guarantee itself is lost (those fees are often built into the cost of insurance and the costs will not adjust when the guarantee is lost). Some policies provide an option for reinstating the guarantee within certain time frames and/or with additional premiums (usually catching up the deficit of premiums and an associated interest). No-lapse guarantees can also be lost when loans or withdrawals are taken against the cash values."

I would like to read the contract of one of these to see what other restrictions it has (if any). It seems similar to a plan that a company named Mid-Continent used to sell in the early 90's. Sort of a term/whole life but the structure of it was the same as WL. If you or anyone can scan a GUL and upload it, that would be great.

----------

This statement shows your lack of knowledge on the subject.

Again with the insults but do you have a contract to upload to prove me wrong?

GPT uses lower COI.

Lower COI is still COI. Or does "lower" give it a completely different definition?

Can you tell me why that is? Without researching it do you know exactly how each testing method effects the policy?

No, I can't. I don't sell UL's...not in 20 years. What does this have to do with what I have said? Can you prove the structure of the UL is not term plus interest CV? No, you can't. All you can do is toss insults and statements not relevant to my points.

I keep asking for you to prove me wrong. I'm still waiting. Please hurry, I won't live forever.

 

[scagnt83]

The only thing you have provided is a statistic on how soon one plan lapses over another. You have yet to show anything to show that any UL is either contractually guaranteed or that the root components of the UL is any different than I have stated. I have asked you and others to show any policy that would prove otherwise and as yet none have been provided.

You claimed that ULs were bad for consumers, dangerous, and that you had no respect for agents who sell them. You even challenged the ethics of agents who actively sell ULs.

So if you do not define "bad" as a lapse and loosing coverage. What do you define it as?
In my opinion a client with active coverage is good and a client with lapsed coverage is bad.



A ULs Guarantee (assuming no secondary guarantee) is based on the assumed funding level at issue.

Yes, if the client skips a premium that Guarantee is altered.
Yes, if the agent implies otherwise they are being unethical.

If you think that most ULs are sold in an unethical way you are out of touch. And the statistics back that statement up.
Maybe among FE agents ULs are sold that way. But in other markets that is not the majority.


If you want to read the Guarantee on a UL, go run some illustrations from some decent companies and read away.

----------

Again with the insults but do you have a plan to upload yet to prove me wrong?

It is not an insult. It is a fact. You even admit your lack of knowledge below in this very quote...


Lower COI is still COI. Or does "lower" give it a completely different definition?

No one is saying that ULs do not have an increasing COI. But my point is that the "increase" and exactly how much that costs, is often very misunderstood.

You act like it would be the same COI as a retail bought ART. And it is no where near that cost on a quality policy.

Also, WL has COI. Its level, but it is significantly more to begin with. And averaged out for the life of the policy it is not as much as the UL bashers make it out to be.
At 30 or 40 years out on an overfunded UL the total cost including COI is most often less than 1% of the CV.


No, I can't. I don't sell UL's...not in 20 years. What does this have to do with what I have said? Can you prove the structure of the UL is not term plus interest CV? No, you can't. All you can do is toss insults and statements not relevant to my points.

Seriously??
I called you ignorant on the subject of ULs. You say your not. That is how it is relevant.

You cant tell me how one of the fundamental aspects of how the policy works? A feature so important that it can cause significantly higher internal costs!?

I think that for statements so strongly worded about a product, the accusers knowledge level about that product is extremely relevant.


I keep asking for you to prove me wrong. I'm still waiting. Please hurry, I won't live forever.

You keep saying to prove you wrong but we have. Over and over. We do not disagree that UL has an increasing COI along with interest dependent CV. But it has more to it than that. And the "more" can be just as important when you sell the product.

It goes to my point of your lack of education on the product.
You have made blanket statements and insults on a subject that you clearly lack knowledge on.

_______________________________________________________


And your references are not good references.

You did not provide one single reputable industry related reference.
The closest thing was a basic UL definition on a lead generation website.

If you want a detailed explanation of a UL policy and all that goes into it I would suggest reading an illustration. Not Forbes and Wikipedia.