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Hi there.
For those of you most experienced with writing IUL, how much of the Premiums do you direct to the fixed account to cover COI/Fees, etc? Allocating 100% to index accounts seems to short-change the clients growth as COI/Fees are taken out monthly but Index credits are general annual or 2 years. Fixed account (similar to UL) credits interest monthly. Just trying to figure out if 10 or 15% is best in the first few years so that the client doesn't forfeit making any index credit on potentially 11 months of COI/Fees deducted that wont be in the CV at end of index cycle to receive an index credit.
Also, if you do advise on X% of initial premiums, do you then advise client to later back down the allocation to fixed account as the CV account grows as the COI/fees may not be as high in later years as a ratio to total CV.
Lastly, I am a believer in Dollar Cost averaging into the index accounts any annual premiums or lump sums/1035 to create the most buckets & avoid risking 1 single day for the index credit to live or die by. Anyone out there against DCA of annual/lump sums?
Thank you in advance
For those of you most experienced with writing IUL, how much of the Premiums do you direct to the fixed account to cover COI/Fees, etc? Allocating 100% to index accounts seems to short-change the clients growth as COI/Fees are taken out monthly but Index credits are general annual or 2 years. Fixed account (similar to UL) credits interest monthly. Just trying to figure out if 10 or 15% is best in the first few years so that the client doesn't forfeit making any index credit on potentially 11 months of COI/Fees deducted that wont be in the CV at end of index cycle to receive an index credit.
Also, if you do advise on X% of initial premiums, do you then advise client to later back down the allocation to fixed account as the CV account grows as the COI/fees may not be as high in later years as a ratio to total CV.
Lastly, I am a believer in Dollar Cost averaging into the index accounts any annual premiums or lump sums/1035 to create the most buckets & avoid risking 1 single day for the index credit to live or die by. Anyone out there against DCA of annual/lump sums?
Thank you in advance