Which WL Carrier has a rider to put in excess PUAs?

[REI_Velocity]

Example: You have 100k this year but not sure about future years, so you set up a 100k policy (premiums + PUA) for 10 years. If next year you only have 30k, cool. The following year you have 60k, great. But you have the bucket to put PUAs in up to 100k. (And I’m not looking for the lump sum option). The use case would be for a client who gets windfalls (like a real estate investor, business owner, etc).

Someone online was teaching there is a rider for this with a specific company but wouldn’t name it. Of all the carriers I’m familiar with I haven’t seen it.

Thanks!

 

[Allen Trent]

Example: You have 100k this year but not sure about future years, so you set up a 100k policy (premiums + PUA) for 10 years. If next year you only have 30k, cool. The following year you have 60k, great. But you have the bucket to put PUAs in up to 100k. (And I’m not looking for the lump sum option). The use case would be for a client who gets windfalls (like a real estate investor, business owner, etc).

Someone online was teaching there is a rider for this with a specific company but wouldn’t name it. Of all the carriers I’m familiar with I haven’t seen it.

Thanks!

So, you are saying this is like a catch up contribution based on what was originally approved for, correct?

I would also like to know as many actuaries worry about those type where a person who has major change in health would be more prone to want to max out PUAR that they hadn't been.

Most experience I have is with one that is less flexible. As long as client has not missed making a deposit into PUAR for 5 consecutive years, they can always put in 1x into PUAR equal to the base policy premium.

To put anyore than 1x, the client had to be putting that higher amount in. So, putting large amount in 1 year, but lower the following year will shut the door to that higher amount forever & reset to the higher of the current year amount or 1x base premium

 

[REI_Velocity]

So, you are saying this is like a catch up contribution based on what was originally approved for, correct?

I would also like to know as many actuaries worry about those type where a person who has major change in health would be more prone to want to max out PUAR that they hadn't been.

Most experience I have is with one that is less flexible. As long as client has not missed making a deposit into PUAR for 5 consecutive years, they can always put in 1x into PUAR equal to the base policy premium.

To put anyore than 1x, the client had to be putting that higher amount in. So, putting large amount in 1 year, but lower the following year will shut the door to that higher amount forever & reset to the higher of the current year amount or 1x base premium

Basically an opportunity bucket to put up to 100K (in my example). I'll note the the person talking about this said the insurance company takes the average of 5 yrs and that will be the new cap for the next 5 years. So if they put in 100, 50, 50, 60, 90, the average of that is 70K, so then that would be the max allowed moving forward for 5 yrs... so it will decrease if one doesn't pay 100% of the 100K each year for the first 5 yrs. The same with the next 5, etc.

 

[Allen Trent]

Basically an opportunity bucket to put up to 100K (in my example). I'll note the the person talking about this said the insurance company takes the average of 5 yrs and that will be the new cap for the next 5 years. So if they put in 100, 50, 50, 60, 90, the average of that is 70K, so then that would be the max allowed moving forward for 5 yrs... so it will decrease if one doesn't pay 100% of the 100K each year for the first 5 yrs. The same with the next 5, etc.

This sounds like maybe Lafayette Life. If I recall, named something like Level premium paid up additions rider that has a min & max for a period, then average resets after the period

 

[Lloyds of Lubbock]

Guardian has a very liberal addds rider.
It really is not a catch up, you are just using the limits of PUA contributions.
For Example: Guardian allows 13x base in year 1 and 3x base 2-10.
There are also limits as when when your adds purchase 1,000,000 of face amount
So I buy a 20k base policy with a $1000 scheduled PUA rider.
In year 1 I add an additional 20 k as an unscheduled payment.
In year two i only add an additional 10k as an unscheduled payment.
In year 3 I add 30k. (20 as planned plus 10 extra to make up for last year)
While it looks like a catch up payment, it is really just staying within their limits.
I would also recommend you make sure you stay within MEC limits

 

[Lloyds of Lubbock]

Every carrier has an adds rider.
Some are more liberal than others

 

[scagnt83]

Guardian has a good rider for this type of flexibility.

 

[pfg1]

This sounds like maybe Lafayette Life. If I recall, named something like Level premium paid up additions rider that has a min & max for a period, then average resets after the period

Lafayette does do that, but it averages the first 7yrs of PUA, then yrs 8+ reduces to set the max PUA allowed at that average. That might be what he is referring to.