Promoting Index Universal Life Insurance

Mar 17, 2008

  1. IUL Agent
    Offline

    IUL Agent New Member

    Posts:
    4
    Likes Received:
    0
    Is there anybody here selling Index Universal Life (IUL) This is a really powerful product and y'all should check it out. You need a Life Agent license obviously, but the product is very easy to sell if you find the right client.

    It combines investment laws and life insurance laws, making IRA, Mutual Funds, 401(K) etc look like jokes.

    Anybody who wants to know more can contact me. I'm located in Cali.

    Also please share your views about this product.
     
  2. LGilmore
    Offline

    LGilmore Guru

    Posts:
    4,105
    Likes Received:
    162
    State:
    Washington
    gee ok, I guess I'll throw all the other stuff out tonight....;)
     
    LGilmore, Mar 17, 2008
    #2
  3. Mr. Bill
    Offline

    Mr. Bill Guru

    Posts:
    2,045
    Likes Received:
    10
    Which companies do you like for IUL? I like it but there are a lot of moving parts in the product...
     
    Mr. Bill, Mar 18, 2008
    #3
  4. Dave020
    Offline

    Dave020 Super Moderator Moderator

    Posts:
    3,357
    Likes Received:
    50
    State:
    California
    I'd think that if you are comparing an insurance product to an investment grade product, you'd also need at least a series 6 & 63 as well as an appointment with an NASD approved Broker-Dealer??
     
    Dave020, Mar 18, 2008
    #4
  5. JMO Fan
    Offline

    JMO Fan Guru

    Posts:
    403
    Likes Received:
    1
    I agree, that's probably what FINRA (aka NASD) would say, as well as many state securities officials.

    My concern with index UL is similar to EIA. Insurer investments are the same as for non-indexed, except for the extra money to buy the stock index options. Also, higher commissions for index products have to come from somewhere -- and it won't be from the company's profits.

    Long-term, extra company costs must come out of the current credits to the product. Insurers won't accept lower profits just to sell indexed versions of their other products. With extra commissions, the product will sell, but the clients will pay for it -- that part is guaranteed.
     
    JMO Fan, Mar 18, 2008
    #5
  6. IUL Agent
    Offline

    IUL Agent New Member

    Posts:
    4
    Likes Received:
    0
    I need a series 6 and 63 just to talk about it? The comparison was only in passing. IUL cash value can be used as retirement through policy loans. The loans attract an interest but not taxes (obviously) because the cash value is taken from after tax dollars.

    It also has a feature that allows you to borrow from the cash value without penalty, a feature that kills almost all qualified accounts. U also don't have to contribute forever in IUL. You can stop whenever and you'll still have Life protection and retirement.

    This is a powerful product, y'all should check it out.
     
  7. Mr. Bill
    Offline

    Mr. Bill Guru

    Posts:
    2,045
    Likes Received:
    10
    No you don't need that, you need a 65.

    Other than that, and with no disrespect, you need to understand the history of ULs and what happened to the policies in the 70's and 80's before making the statement "U also don't have to contribute forever in IUL. You can stop whenever and you'll still have Life protection and retirement".

    You sound very inexperienced, which isn't necessarily a bad thing, it's just that you have a lot more "learning" to do, and it isn't "product knowledge".

    IULs are NOT the be-all and end-all product. You might want to look into whole life as well. I doubt your current FMO will give you any info whatsoever, though.

    Good luck to you!
     
    Mr. Bill, Mar 19, 2008
    #7
  8. Dave020
    Offline

    Dave020 Super Moderator Moderator

    Posts:
    3,357
    Likes Received:
    50
    State:
    California
    Yes, if you are discussing an investment grade, NASD/SEC regulated product, even in passing, in terms of comparison to the performance of a product you are recommending, you need to be securities licensed.

    Are you sure that what you are saying here is approved by your carrier's compliance department? It sounds like you are recommending the use of life insurance as a retirement vehicle, which is not permitted by NAIC and most if not all state DOIs. It's a major no-no.

    Also, it sounds like you may be new. Are you familiar with the term "Surrender Squeeze"? Have you ever heard of Dan Burnnett or Tom Lipscomb? You might want to do some research. What would you tell a client at age 72 when the policy is in danger of imploding and the have the choice of either paying premiums again, repaying the loan(s) or letting the policy collapse and incurring a significant taxable event?

    See my point above concerning the surrender squeeze. Your strategy is not only a compliance nightmare, but is a recipe for disaster, especially with a UL product without the perfect target premium.

    No penalty, but accruing interest at what %? 5, 7, 8% or more? You can borrow from ANY permanent insurance product's cash surrender value with no penalty, this is not a big deal or new thing. That's been around since, oh, the mid 1800's.

    Bah, it probably does not outperform any of the quality Par Mutuals over an extended period of time.
     
    Dave020, Mar 19, 2008
    #8
Loading...