can anyone tell me a good dividend paying whole life co. and give me some info on paid up policy's?
The companies that XRAC mentioned are all good companies that I guess have participating whole-life policies. Participating policies pay dividends.
But don't confuse a policy that the dividend helps pay the premium with a paid up policy. They are two very different things. People often confuse them and many policies lapse because of it. Dividends are NEVER guaranteed.
A paid up policy is one that was sold as either a single premium, 10-year pay, 20-year pay or paid up at age 65. These policies are actually paid up once you reach the end of the payments and the client will NEVER have to worry about making another payment or the policy lapsing.
A lifetime pay policy will NEVER be paid up until it reaches the endowment age (usually 95 or 100) and even if the dividends made the full payment for the last 10-years that doesn't mean it will make them this year or next year. It's never paid up.
------------------------------------
J Scott Burke
Funeral Preplanning
Life Insurance
Medicare Supplements
Long-Term Care Insurance
Annuities
Indiana, Kentucky, Tennessee www.newburyfinancial.com
Thanks for the info. I knew about ten pay single pay but I keep hearing people talk about dividend paying and after so many years it can give you a paid up policy if thats what you choose. There's probably know way to estimate just a guess since we don't know for sure about the cash. I have seen 10 and 20 and single but not paid up at 65. Do all the whole life company's offer this and I have been missing it?
Thanks for the info. I knew about ten pay single pay but I keep hearing people talk about dividend paying and after so many years it can give you a paid up policy if thats what you choose. There's probably know way to estimate just a guess since we don't know for sure about the cash. I have seen 10 and 20 and single but not paid up at 65. Do all the whole life company's offer this and I have been missing it?
You need to correct them when they think a dividend paying the payment is the same as a paid up policy. It is NOT and people thinking that incorrectly is a HUGE mistake.
What happens is; once the dividend has a year that pays the entire premium, the client thinks they have a paid up policy and quits paying anything.
On years where the dividend doesn't make the whole payment, the policy takes an automatic policy loan against the cash value and makes the payment that way.
The client doesn't understand what's happening and still thinks everything is fine and their policy must be paid up. Eventually (usually when they are very old) the cash value runs out and the policy lapses. At that point they have lost their coverage and everything they ever paid in. Then they are MAD at how they think they got screwed.
It is VERY illegal and unethical for an agent to EVER tell someone that their dividends will make their premium payment on any policy. Dividends are NEVER guaranteed with any company. Dividends are unpredictable. They are just a return of excess company profits if any.
I run into a LOT of policies that have lapsed or are about to lapse due to this very reason. And the clients ALWAYS say they have a "paid up" policy.
How about offering a No Lapse Guarantee UL paid up at age 100 with coverage to age 121. No worries and substantially lower cost! It could also be paid up on a guaranteed basis in 10, 15 or 20 years, for example.
I was with a new client last week and she got a friend on the phone who then got her agent on the phone and he is a Met Life agent and was telling me to sell her a dividend policy that could be paid up later with cash value. I thought you just have to call when you want to stop paying and see what your cash value will get you in paid up? Or can you tell someone pay this amount for 20 yrs for $50,000 coverage than stop paying and you will have lets say a $12,000 life policy. Do you get my questions? Maybe I could call you and speak with you directly? I was not happy with the Met agent.Are they a good co.and how good are their products and commissions if you know? Thanks
I was with a new client last week and she got a friend on the phone who then got her agent on the phone and he is a Met Life agent and was telling me to sell her a dividend policy that could be paid up later with cash value. I thought you just have to call when you want to stop paying and see what your cash value will get you in paid up? Or can you tell someone pay this amount for 20 yrs for $50,000 coverage than stop paying and you will have lets say a $12,000 life policy. Do you get my questions? Maybe I could call you and speak with you directly? I was not happy with the Met agent.Are they a good co.and how good are their products and commissions if you know? Thanks
The term you are looking for is "reduced paid up". This occurs when there is enough cash surrender value in the policy to buy a certain level of coverage that is forever paid for.
For example, 150,000 policy in 10 years at 6% will produce enough internal value to drop the 100,000 down to say 20,000 that is forever paid for (even at the guaranteed interest rate). The client can choose to do three things with such a policy:
1. Take the reduced paid up policy (which will still grow) and never pay premiums again on it
2. Continue paying premiums on the full 150,000 policy until either #3 or #1 options are exercised
3. If a mutual, use the dividend to pay some of all of the premium depending on the annual dividend amount (this can be the most dangerous because of rate sensitivity. If dividend scale drops too low, person may have to start making premium payments again)
How about offering a No Lapse Guarantee UL paid up at age 100 with coverage to age 121. No worries and substantially lower cost! It could also be paid up on a guaranteed basis in 10, 15 or 20 years, for example.
Different product altogether than whole-life. Could be good in some situations.
What carriers do you prefer with 20 year pay UL with a no lapse guarantee?
How about offering a No Lapse Guarantee UL paid up at age 100 with coverage to age 121. No worries and substantially lower cost! It could also be paid up on a guaranteed basis in 10, 15 or 20 years, for example.
No worries...? Well if the Insured can pay the prem to age 100, why not just pay it to 121...? Anyone beside me see this is as a gimmick...? So the lucky (or unlucky) client that lives pas 100 get to take one or two years off from paying prems, before they die at 102...?
Syd, I'm not poking fun at your post, just the concept that is presented by the ins industry. 100 vs. 121.... I suppose medical science could fool us, but currently we can't afford for these old folks to hang around untl 100+, so the mortality rate will likely start going the other way soon...
------------------------------------
"A successful man is one who can lay a firm foundation with the bricks others have thrown at him." David Brinkley
No worries...? Well if the Insured can pay the prem to age 100, why not just pay it to 121...? Anyone beside me see this is as a gimmick...? So the lucky (or unlucky) client that lives pas 100 get to take one or two years off from paying prems, before they die at 102...?
Syd, I'm not poking fun at your post, just the concept that is presented by the ins industry. 100 vs. 121.... I suppose medical science could fool us, but currently we can't afford for these old folks to hang around untl 100+, so the mortality rate will likely start going the other way soon...
Where is the gimmick?
That you can "choose" your payment options with the UL policy; or that you believe in a conspiracy theory involving the gov't killing off old people .............LOL
I am still trying to see the relevance of your post; please enlighten me.
------------------------------------ Direct 1-866.417.9580 X 109 mail@ngfgllc.com
That you can "choose" your payment options with the UL policy; or that you believe in a conspiracy theory involving the gov't killing off old people .............LOL
I am still trying to see the relevance of your post; please enlighten me.
Why not a paid up policy at age 65... or 70...? when income usually changes for a retiree....? Paid up at 100... hmmm, what percentage of folks will live long enough to reach "paid-up status"...? That is what is odd to me... kind of like your wife telling you that age 112 it will be fine for you to start seeing other women... Gee Hun, thanks.
The giimick is for most folks that hear the words "paid-up" and think that they will live long enough to experience the event... (Ya know, the high BMI Tbl 3 smoker... that is the one I am talking about). That will happen like a snowballs chance in he!! But they do get the pleasure of paying a higher than high prem for faster c/v accumulation, but still get the same d/b as if they had paid 90% of the same prem if calculated to lapse at age 121... Nothing wrong or weird with that in your eyes I-Exec...?
Why not a paid up policy at age 65... or 70...? when income usually changes for a retiree....? Paid up at 100... hmmm, what percentage of folks will live long enough to reach "paid-up status"...? That is what is odd to me... kind of like your wife telling you that age 112 it will be fine for you to start seeing other women... Gee Hun, thanks.
The giimick is for most folks that hear the words "paid-up" and think that they will live long enough to experience the event... (Ya know, the high BMI Tbl 3 smoker... that is the one I am talking about). That will happen like a snowballs chance in he!! But they do get the pleasure of paying a higher than high prem for faster c/v accumulation, but still get the same d/b as if they had paid 90% of the same prem if calculated to lapse at age 121... Nothing wrong or weird with that in your eyes I-Exec...?
I must say that is a very compelling point. As I am sure you are well aware there are many premium options associated with a UL.
With respect to your argument just remember when Social "In"security was created and cross-reference the mortality tables from then. Same Argument; from in which I agree!
The table 3 smoker that you are referencing would have the same premium options as a preferred risk case; but who said anything about paying a higher premium for C/V accumulation?
What I think the individual was speaking of, and correct me if I am wrong, was buying a UL policy with a "coverage protection guarantee" of some sort. You can have this added to your policy with a single payment or a myriad of other choices.
The greatest problem I have seen, as of late with UL, is the individuals that bought UL polices back in the late 70's to the mid 80's with high assumed interest rates, due to rampant inflation; and their contracts have crashed.
Granted disclosure is the key, but there were NO guarantees in these particular contracts with respect to the DB. Totally different argument.
What about the conspiracy theory? Did I completely miss the mark?............LOL
Aviva's rates are good, but they were recently downgraded from A to A- and are having a lot of issues with their annuity side from what I can gather. I was also told by my GA that they are not very good on working around apps that aren't perfectly clean compared to some of the other major carriers.
Aviva's rates are good, but they were recently downgraded from A to A- and are having a lot of issues with their annuity side from what I can gather. I was also told by my GA that they are not very good on working around apps that aren't perfectly clean compared to some of the other major carriers.
I definitely agree.
Another company I would look at would be North American and Lincoln. Both have good products and their underwriting is a little more liberal.
We just shopped a 20K premium life case for one of my agents and found that both of these companies came out on top!
Dividend Whole Life
Linear Mode
