Whole Life Vs Universal Life?

[caddison]

Ok.... So after 8 years as a captive agent and never having a UL product to offer, as the company didn't believe in them, oh but we did have a "Interest Sensitive Product" that we quit offering due to poor performance and speculative sales approach used by some agents as being a paid up policy, I was taught that most ul's were not a good plan.

I do know that a limited pay whole life product is just that. You pay for a limited time, the policy is paid up and will continue to grow face value if participating and continue to grow cash value. No mater what the market does the policy will always be in force as it is paid up and the rate of reurn will never be less than the policy guarantee. A life pay policy will also be in force with no premium increase, no increase in insurance cost and no market affiliation as long as you pay the premium.

My question is, I know "finally", is there a UL or IUL product out there that can offer the same guarantees? I am a firm believer in that the only good policy is the policy that is in force when the need arises for the insured and I don't want my clients getting a letter telling them they need to contribute and additional $2,000 to their policy for it to remain in force when they reach their retirement years. I would like to find a good company that offers a solid whole life product with limited pay options and decent cash value accumulations, a single premium paid up additions rider would be beneficial also.

Thanks for the impute!

 

[DHK]

The more guarantees you want... the more you want whole life.

Whole life is a bucket without any leaks in it. Sure, it doesn't grow as fast as others, but you're not losing money out the back end due to additional fees and increasing costs of insurance.

With UL, if you're looking for guarantees, then you're looking for a GUL - with little to no cash values, but a guaranteed premium for the rest of the insured's life.

Depending on the age and premium commitment, you may want to consider UL or IUL as long as you are maximum funding a minimal death benefit. That's the only way to help 'beat' the costs.

The concepts are attractive (cause we're all brainwashed to think that higher returns are what finances are all about)... but you still have to deal with the slow leak out of the UL/IUL bucket.

 

[Franz Kafka]

Ok.... So after 8 years as a captive agent and never having a UL product to offer, as the company didn't believe in them, oh but we did have a "Interest Sensitive Product" that we quit offering due to poor performance and speculative sales approach used by some agents as being a paid up policy, I was taught that most ul's were not a good plan.

I do know that a limited pay whole life product is just that. You pay for a limited time, the policy is paid up and will continue to grow face value if participating and continue to grow cash value. No mater what the market does the policy will always be in force as it is paid up and the rate of reurn will never be less than the policy guarantee. A life pay policy will also be in force with no premium increase, no increase in insurance cost and no market affiliation as long as you pay the premium.

My question is, I know "finally", is there a UL or IUL product out there that can offer the same guarantees? I am a firm believer in that the only good policy is the policy that is in force when the need arises for the insured and I don't want my clients getting a letter telling them they need to contribute and additional $2,000 to their policy for it to remain in force when they reach their retirement years. I would like to find a good company that offers a solid whole life product with limited pay options and decent cash value accumulations, a single premium paid up additions rider would be beneficial also.

Thanks for the impute!

It's not so much the product but the way the policy is designed. Interest Sensitive WL can be a wonderful product if designed properly. Also ... although the majority of people want guarantees when the economy's down (low interest rate) and are willing to take the risk when the economy's up (high interest rate), it should be the other way around - that guaranteed payments aren't the wisest when interest rates are as low as they are today (but then always sell them whatever they want to buy).

 

[BNTRS]

To answer your questions:

No, there is no such thing as a UL that will offer the same guarantees as Whole Life insurance. If it did, it would be called whole life insurance.

Are there products that can get you close? Maybe, it depends a lot on the circumstances. If you want to drill down a little more into the specifics, we can help you, here.

As for the company you are looking for. Couple of suggestions:

Guardian, Ohio National, and Lafayette Life would be good bets for what you've specified you're looking for.

Now, if you're lucky, a certain someone will stop by and begin his cheer leading for UL. We might go back and forth a bit, it'll be entertaining if nothing more.

 

[jdeasy]

We really needed a discussion on the difference between whole life and UL. Maybe throw in some term insurance too.

Never been discussed here before.

 

[VolAgent]

No, there is no such thing as a UL that will guarantee offer the same guarantees as Whole Life insurance. If it did, it would be called whole life insurance.

Someone should frame that. You can bash WL all you want, but at the end of the day, it has guarantees that nothing else has.

 

[Guest]

How is guaranteed no lapse UL to Age 121 with guaranteed premiums and benefits any less valuable than much higher priced Whole Life? Who needs cash value and dividends that much higher Whole Life premiums provide when they're Age 60+???

 

[medsuptage]

Someone should frame that. You can bash WL all you want, but at the end of the day, it has guarantees that nothing else has.

and your going to pay dearly for them.

 

[VolAgent]

and your going to pay dearly for them.

Guarantees aren't cheap.

People repeatedly get burned when they try to get a policy to do everything whole life does, but not at that price.

 

[Newby]

How is guaranteed no lapse UL to Age 121 with guaranteed premiums and benefits any less valuable than much higher priced Whole Life? Who needs cash value and dividends that much higher Whole Life premiums provide when they're Age 60+???

Someone who wants them. You are making the assumption that no one ever pulls money out of their policy.

You are also making the assumption that no one ever ends their policy before death.

GUL is cheaper for a reason. If it's the right fit, it's good. If it's not the right fit, it's bad.

If people are sold GUL and never even offered whole-life, the agent was weak and the client is much more likely to screw it up. Happens all the time.