Lloyds of Lubbock
Guru
- 714
The Variable Loan Interest Rate on Whole Life products has decreased from 6.20% to 5.33% effective April 1st and will remain at that rate at least through June. The May 31st ending value for the applicable Moody’s rate will determine if interest rates are changed for July-September. You may want to reconsider re-running any recent illustrations that show any loans coming from the policy.
· The Premium Deposit Account rate is decreasing in May. Through April, we have a 12% enhanced rate for the first year, followed by 6% in subsequent years for clients who pre-fund at least four years of future premiums. On 5/1, these rates will decrease to 10% and 5%, respectively. The PDA is used to fund a Custom Whole Life, Custom Survivorship Whole Life, Secure Wealth Plus, VUL Accumulator II, or Market Wealth Plus policy in a lump sum without creating a modified endowment contract. The PDA interest is applied to premiums to reduce the client’s out-of-pocket costs. Rates are locked in at the time the policy is issued and are not based on the application date.
The drop on the interest rate is interesting. It is a big drop.
· The Premium Deposit Account rate is decreasing in May. Through April, we have a 12% enhanced rate for the first year, followed by 6% in subsequent years for clients who pre-fund at least four years of future premiums. On 5/1, these rates will decrease to 10% and 5%, respectively. The PDA is used to fund a Custom Whole Life, Custom Survivorship Whole Life, Secure Wealth Plus, VUL Accumulator II, or Market Wealth Plus policy in a lump sum without creating a modified endowment contract. The PDA interest is applied to premiums to reduce the client’s out-of-pocket costs. Rates are locked in at the time the policy is issued and are not based on the application date.
The drop on the interest rate is interesting. It is a big drop.
