Whole life cash value automatically adjusts in high interest rate environment?

[Lloyds of Lubbock]

The value of a whole life policy is not in the returns of the cash values.
The permancy of the death benefit allows you to maximize other assets.
My wife is 15 years younger than me.
My pension and annuities are straight life.
If I die they are gone but she gets a boatload of death benefit so we get to enjoy a better lifestyle now and she does not take an income hit upon my death.
In 3 years I have to start taking distributions from my 401k.
When the market is down I can take a minimum distribution (let the market hopefully bounce back) and and subsidize it with a distribution from my life policies if need be.
I could create a very long list, but I think you get the point.

 

[Lloyds of Lubbock]

Are we talking about Ohio National policies here since its 0%??

That's cruel

 

[Lloyds of Lubbock]

NML did keep their 5% scale.
Mass kept their 6% scale.
https://www.masslive.com/business/2...d-record-payout-for-172-year-old-company.html
It is interesting: Years ago in these announcements they always referenced mortality and expenses.
If you read the statement fro Mass it says it maintained it's 6% interest rate.
No mention of the other components

 

[Allen Trent]

NML did keep their 5% scale.
Mass kept their 6% scale.
https://www.masslive.com/business/2...d-record-payout-for-172-year-old-company.html
It is interesting: Years ago in these announcements they always referenced mortality and expenses.
If you read the statement fro Mass it says it maintained it's 6% interest rate.
No mention of the other components

And every policyholder & most agents read that & believe policyholders made 6% on their policies. How do these dividend announcements not fall under the deceptive advertising insurance regulations. Carrier capital does not equal client cash values. I am very certain a mass policy with 100k cash value last year now has $106k cash value plus annual premium paid

 

[Lloyds of Lubbock]

Alan it is much worse than that.
I have heard experienced agent tell clients that they get a guaranteed 4% rate.
Going back quite a few years NML took out an ad in the NY Times that said NML paying an 8% dividend.
The disclaimer or CYA statement covers litagation

 

[Allen Trent]

Alan it is much worse than that.
I have heard experienced agent tell clients that they get a guaranteed 4% rate.
Going back quite a few years NML took out an ad in the NY Times that said NML paying an 8% dividend.
The disclaimer or CYA statement covers litagation

Just crazy insurance regulators don't force clarification

 

[Lloyds of Lubbock]

I think it is a training issue also.
You need to know what you dont know.
If you are going to live by the numbers...you will also die by the numbers.
NML has a net dividend rate. Guardian is a hybride rate.
If a Guardian agent keeps hyping that their dividend is higher than NML but NML has a better looking illustration, how does he reconsile that to a potential client?
Don't use numbers you cannot explain.

 

[Al3x Lee]

Are you buying one from me if I explain it to where you can understand it?

Ray and DHK are gonna sell me on it today lol. Plus I need 2 things, to understand it AND be proven that there is value that I'm not seeing

 

[scagnt83]

Ray and DHK are gonna sell me on it today lol. Plus I need 2 things, to understand it AND be proven that there is value that I'm not seeing

To sum it up, its tax-free growth of your money.
Then tax-free distribution of your money.
At a rate of return similar to that of a taxable bond.
Then it provides a tax-free death benefit, that is higher than the actual account value.

Depending on your tax bracket and carrier used, it would take a taxable return of 4.5%-7% to equal the tax-free return of a WL that returns 3%-4% (internal rate of return).

And it has zero risk of loss. Therefore it makes an excellent bond alternative, CD alternative, etc., and can be very suitable for high income earners who are already maxing out qualified plans.

It can also provide a Long Term Care or Chronic Illness Benefit, Critical Illness benefit, & Terminal Illness Benefit. (its a portion of the DB)

It can also guarantee approval for future increases in life insurance coverage, regardless of your health.

Also, a certain amount of permanent insurance can make sense for a lot of people. Tons of term buyers from 20 & 30 years ago are now forced to purchased high priced GUL with zero cash value because they "surprisingly" still need life insurance coverage after age 55.

 

[WinoBlues]

Tons of term buyers from 20 & 30 years ago are now forced to purchased high priced GUL with zero cash value....

If they are lucky enough to qualify for it.

Had this conversation with a 76 yo terming out client yesterday.