Your Opinion - WL versus Term with ROP

myinsurebiz · 09-23-2008, 06:54 PM

We had this debate in a training today and I would like your opinions please. All the little kiddies try to be serious k?

Would you recommend Term with ROP or Whole Life in the following instances:

#1 - Married couple - both 30 - good health.

#2 - Single Guy - 40 - has 3 kids - divorced - good health.

#3 - Single Lady - 60 - HBP and Diabetes - controlled.

Choice and Why please . . .

Thanks,

Tom

joshril · 09-23-2008, 08:19 PM

Term without ROP... Permanent insurance should rarely be used in a case when mere insurance protection is needed. I have sold permanent insurance when there were estate tax issues, buy/sells, etc... but not for mere insurance protection.

Since you gave no details, I assume these people are looking at income replacement and final expenses? Frankly, this is not enough info to make a judgment, but I will NEVER recommend a ROP term.

On a side note... the commission on a whole life policy on a 60 year old with diabetes wouldn't be bad... for the agent... Now if this lady owns a business and wants to setup a buy/sell or a key-man policy, I would change my tune.

Not to be rude, but I don't think you're qualified to be offering permanent insurance, Tom.

OHInsAGNT · 09-23-2008, 08:35 PM

I think that in any of those situations it would depend on the needs and desires of the client. Talk to them about what they want to achieve with the insurance plan and guide them into what you feel best meets those needs with a framed pro and con discussion. They make permanent term insurance plans now, as well. It's essentially a universal life policy with a minimum payment that will never allow the policy to lapse and no cash value accumulation. They still payout at 100.

I couldn't make a decision based on the information given.

# 3 would be a tough premium to sell, once it's rated, regardless of product.

Mr. Bill · 09-23-2008, 08:36 PM

Well, how's the retirement plan going? Could be a really really really good reason for a permanent policy. (Ouch)

joshril · 09-23-2008, 08:58 PM

Originally Posted by Mr. Bill

Well, how's the retirement plan going? Could be a really really really good reason for a permanent policy. (Ouch)

Good plan... let's sell out of our investments and buy a VUL or WL/UL... then we lock in our market losses...

Mr. Bill · 09-23-2008, 09:04 PM

Nice try, I didn't say that at all and I'm sure you meant no offense. You and I both know that many, many people are underfunded for their retirement and leave their spouse in the lurch. It's definitely worth considering while people are insurable.

BTW, still liking those tax-deferred plans? Can't wait to see what the taxes will look like coming out. Ouch!!!

SportsNut · 09-23-2008, 09:32 PM

Originally Posted by myinsurebiz

We had this debate in a training today and I would like your opinions please. All the little kiddies try to be serious k?

Would you recommend Term with ROP or Whole Life in the following instances:

#1 - Married couple - both 30 - good health.

#2 - Single Guy - 40 - has 3 kids - divorced - good health.

#3 - Single Lady - 60 - HBP and Diabetes - controlled.

Choice and Why please . . .

Thanks,

Tom

Not really enough info about each situation to make a recommendation.... but... assuming that these are avg income and expense folks... (ass-u-me)

1 & 2) 30 yr term.... either with or w.o ROP. I am not a fan of ROP personally.

3) definitely not enough data... you don't even state the face amt./need/desires. It will likely come down to the cost of the plan/affordability, then backing into a max face amt that this will purchase. This will not be cheap with 2 conditions, may be looking at a tbl 4 to 6, or worse, depending upon her weight... Then on the other hand, how long is this gal going to live with her conditions...? Maybe 15 yr term does the trick... (joke)

Now let me ask you a question... how much is 457 +.... = ____ . You should be able to figure out the answer.

GreenSky · 09-23-2008, 11:28 PM

Originally Posted by myinsurebiz

We had this debate in a training today

Isn't training supposed to answer those kind of questions? I can't imagine you're doing the training.

By the way, the answer to those questions is almost obvious.

Rick

joshril · 09-23-2008, 11:32 PM

Originally Posted by Mr. Bill

Nice try, I didn't say that at all and I'm sure you meant no offense. You and I both know that many, many people are underfunded for their retirement and leave their spouse in the lurch. It's definitely worth considering while people are insurable.

BTW, still liking those tax-deferred plans? Can't wait to see what the taxes will look like coming out. Ouch!!!

Agreed...

TXINSURANCE · 09-23-2008, 11:37 PM

1. Straight Term & CI - ROP if it makes them warm and fuzzy.
2. Straight Term & CI - ROP if it makes them warm and fuzzy.
3. Straight Term NO CI or ROP - Price is a big issue with conditions listed and age is a huge factor.

Of course I have not enough data about the clients to remotely recommend anything, this answer is generic at best.

A lot depends what the clients is trying to accomplish or protect.