So did you decide it was suitable or no? In my experience (this case aside because too many details are unknown) if an agent has to ask if sale is suitable then 99% of the time it is not. Normally the agent knows that it isn't really and is looking for an outsider to validate the sale so their conscience is clear. Not saying that's the case here. No way to tell with so few details (mainly the clients future plans and intentions for the money). If you're that worried about future ltc needs, have you spoken with her about ltc insurance?
Suitability Question
- Thread starter spartuna
- Start date
- 1,641
Does this include mva? After they take back the bonus and it's earnings, $8,100, a 10% surrender would leave her with $65,600. Surely interest rates today are lower than they were 3.5 years ago.
If she dies, will the benes be forced to take a payout over 10 years?
What is her account value if you get her a 10% bonus?
If she dies, will the benes be forced to take a payout over 10 years?
What is her account value if you get her a 10% bonus?
On the master dex10 there was annuitization at death but it changed sometime in 2006 due to all the class actions. Same with Aviva.
There are a LOT of unknowns here as mentioned above but I don't think I'd say that this is completely unsuitable.
Those older Allianz contracts were pretty bad and were almost never sold properly, leaving the client with either to much income or not enough due to strict payout options.
So I would not listen to everyone on here (except for the fasion advice, that was good advice) and read up on that contract as much as possible and make an intelligent comparison, I'm guessing that you got blasted and that why you took the post down.
Is she really planning on taking income if so when, is she still working, does she have other assets (not counting house), if so how much and how liquid is it?
There are a LOT of unknowns here as mentioned above but I don't think I'd say that this is completely unsuitable.
Those older Allianz contracts were pretty bad and were almost never sold properly, leaving the client with either to much income or not enough due to strict payout options.
So I would not listen to everyone on here (except for the fasion advice, that was good advice) and read up on that contract as much as possible and make an intelligent comparison, I'm guessing that you got blasted and that why you took the post down.
Is she really planning on taking income if so when, is she still working, does she have other assets (not counting house), if so how much and how liquid is it?
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- 10,806
The masterdex 10 was a terrible contract. My grandmother had one.... 
(at least I think it was the masterdex)
Your basically locked into the contract forever; even after the surrender period is up your forced to annuitize for a minimum of 10 years if you want to get your hands on your money.
If you want to lump sum out after the 10 you get 90% of premium back and its credited something like 2% or 3% for the 10 years (and of course you loose that big 10% bonus) .... terrible terrible terrible contract....
And if I remember correctly the surrender charges where fairly high. I will try to find the old literature I had for this and post it for you.
(at least I think it was the masterdex)
Your basically locked into the contract forever; even after the surrender period is up your forced to annuitize for a minimum of 10 years if you want to get your hands on your money.
If you want to lump sum out after the 10 you get 90% of premium back and its credited something like 2% or 3% for the 10 years (and of course you loose that big 10% bonus) .... terrible terrible terrible contract....
And if I remember correctly the surrender charges where fairly high. I will try to find the old literature I had for this and post it for you.
Dont remember the exact charges but i thought it was something like 15, 15, 15, 15, 15, 13, 11, 8, 6, 4, 2, 0.
Those figures aren't exact cause Allianz used to use numbers like 6.54%, 4.38% they weren't all even numbers.
Even if those arent exact they are gonna be high and in the 3rd year def still the same as the first.
Basiclly this policy will never really be out of surrender because to keep her bonus and all her gains she must annuitize.
If this does not meet her needs there are probably some more suitable options for her.
The key to this is really in her contract because there were changes right around this time with allianz so it hard to say.
Those figures aren't exact cause Allianz used to use numbers like 6.54%, 4.38% they weren't all even numbers.
Even if those arent exact they are gonna be high and in the 3rd year def still the same as the first.
Basiclly this policy will never really be out of surrender because to keep her bonus and all her gains she must annuitize.
If this does not meet her needs there are probably some more suitable options for her.
The key to this is really in her contract because there were changes right around this time with allianz so it hard to say.
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- Thread starter
- #16
I appreciate everyone's input on this case. I looked at her contract very carefully and tried to calculate different income scenarios to compare the two.
I computed future growth of the existing contract at 4%, then using the life income settlement option at annuitization vs. the possible new contract with the guaranteed income for life.
There are some advantages to replacing, especially if she needs long term care, which is a big concern of hers due to her health, (I looked into a separate LTC policy and she would be highly rated and it would not be affordable for her)
I gave her the information and told her to consider everything, she says she definitely wouldn't need to touch until rmd's in 7 yrs.
I computed future growth of the existing contract at 4%, then using the life income settlement option at annuitization vs. the possible new contract with the guaranteed income for life.
There are some advantages to replacing, especially if she needs long term care, which is a big concern of hers due to her health, (I looked into a separate LTC policy and she would be highly rated and it would not be affordable for her)
I gave her the information and told her to consider everything, she says she definitely wouldn't need to touch until rmd's in 7 yrs.
