Policy Cash Value vs Premiums paid

[WinoBlues]

Way to many unknowns to answer.

Is it truly Whole Life? Anniversary date - it is is the same date on the policy and what is listed on last year's annual report.

I would suggest you get together with an experienced Life Insurance agent. Start with a three way call to get the details. Including inforce illustrations and beneficiaries. They should be more qualified than the customer serve clerk or you are to understand where she is currently. Not difficult just a little time consuming.

As far as if she has been taken advantage of - if she had made one payment and died the company potentially would have paid the beneficiaries thousands. On your home and auto insurance, how much cash values have accumulated? She has an insurance policy, not an investment.

You made a wise decision reaching out to Life Insurance agents. To many times people listen to well meaning but uneducated friends.

Lee

 

[STIBROKER]

I would ask if you stopped paying on the policy how long would it last......

 

[jboussea]

I'm trying to find out information for my mother regarding a Whole Life Insurance policy she has.

She started this policy roughly 10 years ago (I had no idea this whole time) and is in her early 70's. As her English is not the greatest either, the possibility that she may have been taken advantage of sits in the back of my mind.

I took a look at her account today and saw that she's been paying her premiums monthly, for the past 10 years.

But the Cash Value amount of the Whole Life Insurance policy does not match the Premiums she has been paying. The Cash Value amount is roughly $2,000 less than the total Premium amounts she has paid (i.e.: Cash Value of $27,000 and Total monthly premiums paid for 10 years = $25,000).

Where is this gap coming from? Just a note, I'm not too familiar with Life Insurance as well so I'm trying to help my mother out.

Also is it the policy of Insurance companies to mail out the Notice of Anniversary date on the exact Anniversary date? She wanted to change her policy but was told that she had to have done it before the anniversary date or wait until the next anniversary date. Well, she couldn't exactly do that as she didn't receive the letter until 5 days after her policy anniversary date.

Thanks in advance.

The most important question should be who is her Life insurance agent , who sold her the policy? You should be asking him first and then verify what he's saying if you're skeptical.

What was the reason for getting the life insurance policy?
How much is the death benefit?
What's making you think that she got taken advantage of other than the cash value?

At first glance, the fact that she's 70 and has had it for 10 years , if I would take a wild guess, I would assume her primary reason for getting the life insurance would be death benefit, if the cash value is that close to the premiums paid, chances are she didn't get taken advantage of .. but again that's a guess.

 

[FinalExpenseDojo.com]

That's not too bad of a policy. $2,000 for 10 years of life insurance is extremely cheap!

 

[Robert Barney]

That's not too bad of a policy. $2,000 for 10 years of life insurance is extremely cheap!

Do you know what the face amount is?

 

[WinoBlues]

Do you know what the face amount is?

Again, way to many unknowns. This could be a UL, IUL Par or Non Par WL.


DB - since the policy is 10 years old and the CV is $25,000. Lets guess the the DB is at least $35,000+ Probably more like $50,000+

Just for comparison a $35,000 MoO SIWL on a 72 non Female in NJ is about 203.mo

 

[WinoBlues]

If that's the case, I'm wondering when that is.

My mother has had the policy for close to 12 years now but there is still a gap of $2,000.

What kind of plan and with which company?

 

[FinalExpenseDojo.com]

Do you know what the face amount is?

Nope but if the CV is around $25,000 it has to be higher than that. Even if it was $25k death benefit... for $200 a year that's a good deal!

 

[Robert Barney]

Today if she was 60, a preferred plus non-smoker could buy $150,000 of Columbus Life No Lapse UL for $168.74 per month (Preferred Plus), $182.99 per month (Preferred) or $207.37 (standard). This assumes the buyer was looking for death benefit when they die.

You could cut the death benefit to $125,000 and make a similar product paid in 20 years or cut the death benefit to $75,000 and make it 10 pay.

 

[Tahoe Ray]

Today if she was 60, a preferred plus non-smoker could buy $150,000 of Columbus Life No Lapse UL for $168.74 per month (Preferred Plus), $182.99 per month (Preferred) or $207.37 (standard). This assumes the buyer was looking for death benefit when they die.

You could cut the death benefit to $125,000 and make a similar product paid in 20 years or cut the death benefit to $75,000 and make it 10 pay.

I think they're saying it would be 200/yr, not 200/mo.