Low Interest Rates Effecting LTC & Life Ins.

[Tothetop]

originally posted by Tothetop



Then I would assume that with very low interest rates as we see today, now would be the time to sell non-guaranteed UL's?

Why do you assume that?

 

[Arthur Rudnick]

originally posted by Tothetop


Then I would assume that with very low interest rates as we see today, now would be the time to sell non-guaranteed UL's?

Why do you assume that?

Only because if rates are not guaranteed and interest rates are at an all-time low, they can only go up, which would improve the performance of the policy.

Bad assumption?

 

[Tothetop]

originally posted by Tothetop


Then I would assume that with very low interest rates as we see today, now would be the time to sell non-guaranteed UL's?



Only because if rates are not guaranteed and interest rates are at an all-time low, they can only go up, which would improve the performance of the policy.

Bad assumption?

Oh ok. I wanted to make sure that I was clear on where you were coming from. It's not that your assumption is bad because naturally it sounds like the sensible thing. However, it's where your starting. If someone sold UL's because of interest then they shouldn't be selling insurance. They should sell investments. UL is life insurance first then it has other benefits that can address other concerns. So interest rates possibly going up in the future hopefully shouldn't inspire someone to sell more UL. Also low interest rates play a role in the policy's performance today up until to the point when rates go up (whenever that may be).

Most importantly, interest sensitivity is just a piece of the pie. What makes UL really special is its flexibility i.e. flexible premium payments, death benefit options, cash value accumulations, etc. Interest sensitivity just plays a role in its flexibility as the other benefits just mentioned.

I am a "guarantees" type of guy. I want what the policy says it will do it will do. My market isn't millionaires and I don't do wealth planning. I work with everyday folks who don't have the luxuries to take chances. So I have never sold a UL policy but I know agents that do. I know agents that use them for complex cases. I just personally don't sell them and that's not necessarily a knock on the agents that do.

 

[Arthur Rudnick]

Thanks Tothetop,

I'm no life expert but I have sold a number of Term and some UL policies in my career.

I only wind up in a UL conversation with someone who is not happy with a Term product not being there when he's 85 or 90. So, my only selling point is that UL will cover them until the day that they die.

I know that in putting together a UL policy, there's a lot of moving parts. I don't focus on cash value, because for the most part, that's not what my clients are looking for, they're looking for a life insurance policy with lifetime coverage.

I'll run an illustration out to 106, keep the CV low and therefore keep the premium low. I only focus on the Guaranteed column, not the non-guaranteed numbers.

This may not be how it's taught in Life Insurance 101, but it serves my purpose and takes care of my client's needs & concerns. I try to keep it simple. Anything more complicated and I'll turn the case over to a life specialist.

 

[Tothetop]

Oh ok. Nothing to thank me for. We're just having a conversation. Yeah, I get what you are saying. Hey, as long people know what they are getting and agents know enough about what they are selling, that's all that matters. The products today are better than some of the in-force products of yesteryear.

 

[ltcadviser]

originally posted by Tothetop



Then I would assume that with very low interest rates as we see today, now would be the time to sell non-guaranteed UL's?

No Arthur. Write guaranteed ul.

 

[Arthur Rudnick]

originally posted by ltcadviser

No Arthur. Write guaranteed ul.

Thanks Jack but I would only do a GUL policy.

 

[ltcadviser]

originally posted by ltcadviser



Thanks Jack but I would only do a GUL policy.

Yiddishe kops think alike!