As mentioned, both have their place. For me, I just favor WL because I know there will be no surprises. It will do what you tell your clients it will...and with no risk. Its been around for ever and always has. That is not to imply that IUL won't....there is just no guarantee that it will perform as most are illustrated. IUL is a relatively new product in the big scheme of things, to it doesn't have the long standing track record to look at (yet). Hopefully it will down the road.
I run my IUL illustrations at 5.95%. (yeah, that's lower than most) That way I'm not showing pie in the sky, but something that is actually (and according to studies) much more likely to happen. If it does better, great. If it does worse, it probably won't be alot worse.
Most carriers and many practitioners will automatically default to the max allowed in the illustration system. This varies but often its over 8%. So you end up showing an illustration where the numbers are huge. Could it do that, certainly possible. Will it? We don't know. I personally lean on the more conservative side. I feel like this is why IUL is so popular. You can illustrate this amazing super sexy result down the road that is very attractive to clients...which often leads to bigger cases, which equals higher commissions. When you compare an IUL at 8+% to a WL, of course the WL doesn't look as good. When you compare at a lower rate, they aren't so different.
When I offer (or sell) and IUL, I let them know that there is no guarantee it will do what we are outlining (but a good chance it will), and if they are comfortable with that... great. I also let them know that to have the best chance of having success long term, all we can control is the design of the policy and making sure they max fund it. If its done that way, there is a good chance it will be a nice policy down the road.
You mentioned commissions.... I agree, do the right thing for the client and commissions will take care of themselves. If you sell at target or below... imo, you are setting your clients up for failure down the road. If they just need permanent covg for the least cost, go GUL.
I run my IUL illustrations at 5.95%. (yeah, that's lower than most) That way I'm not showing pie in the sky, but something that is actually (and according to studies) much more likely to happen. If it does better, great. If it does worse, it probably won't be alot worse.
Most carriers and many practitioners will automatically default to the max allowed in the illustration system. This varies but often its over 8%. So you end up showing an illustration where the numbers are huge. Could it do that, certainly possible. Will it? We don't know. I personally lean on the more conservative side. I feel like this is why IUL is so popular. You can illustrate this amazing super sexy result down the road that is very attractive to clients...which often leads to bigger cases, which equals higher commissions. When you compare an IUL at 8+% to a WL, of course the WL doesn't look as good. When you compare at a lower rate, they aren't so different.
When I offer (or sell) and IUL, I let them know that there is no guarantee it will do what we are outlining (but a good chance it will), and if they are comfortable with that... great. I also let them know that to have the best chance of having success long term, all we can control is the design of the policy and making sure they max fund it. If its done that way, there is a good chance it will be a nice policy down the road.
You mentioned commissions.... I agree, do the right thing for the client and commissions will take care of themselves. If you sell at target or below... imo, you are setting your clients up for failure down the road. If they just need permanent covg for the least cost, go GUL.
