2) With whole life, if you keep paying your premiums, your heirs will ALMOST DEFINITELY GET PAID. For instance, if you have a $1mn policy at $10k/year of premium, you know with near certainty that your spouse and kids will one day get $1mn. Even if you are paying in $10k per year which is a lot of money, then if you start at age 30, you will pay in $500k cumulatively by age 80. If you die at 80, your heirs get $1mn. Also keep in mind that this benefit is generally NON-TAXABLE!


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In the 1980s and 1990s, the SOA 1975–80 Basic Select & Ultimate tables were the typical reference points, while the 2001 VBT and 2001 CSO tables were published more recently. As well as the basic parameters of age and gender, the newer tables include separate mortality tables for smokers and non-smokers, and the CSO tables include separate tables for preferred classes.[12]
Accidental death and AD&D policies very rarely pay a benefit, either because the cause of death is not covered by the policy or because death occurs well after the accident, by which time the premiums have gone unpaid. To know what coverage they have, insureds should always review their policies. Risky activities such as parachuting, flying, professional sports, or military service are often omitted from coverage.
All points have merit but, like any service, unprofessional service can be punished by walking. However, point #4, “market blocking” is a particularly confounding practice in P&C (I don’t think this occurs in LIfe & Health). Market blocking is a matter which Insurance Commissioners could easily correct nationwide to the immediate benefit of the customer.

Your point is valid in that everyone has different risk tolerances objectives etc. so what is good for me is not good for someone else. As for, is the insurance enough for my children; I added an additional purchase benefit where they can add ten times as much coverage no matter what health issues they have. They don’t have to go through a medical. So of they develop juvenile diabetes and they want to add more coverage when they are 18, the company still looks at them in perfect health. They don’t need a medical exam when they add more coverage.

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Finally, everyone who accumulates assets will have a life insurance policy of one type or another. Social Security currently is “a life insurance policy”. Will it be around in 30 years? Who knows…who knows what will be there. All I know is that a good plan will have a guaranteed income source that they can not outlive. Many people with assets take Social Security before age 70 because they want to be sure to get something out of it…this is a life insurance decision. They reduce their life time income by taking payment early. If they owned a permanent life policy, they could reduce their investment risk by spending assets and leverage the insurance policy to replace the assets they use while they delay taking income from SS and the increased payment the benefit provides can increase their life style, pay the premium and create a legacy for their children, grand children or favorite charity. Life insurance “loans” are not income. They are loans. So if a person planned ahead, they could receive 10’s of thousands of dollars from the cash value of their policy (and ROTH IRA money) and not pay a dime of income tax on the social security benefit. If inflation happens and interest rates and taxes increase, the SS benefits will increase and this person will have increasing income that won’t be consumed by an increase in taxes as all their income would be tax free.

Limited risk of catastrophically large losses: Insurable losses are ideally independent and non-catastrophic, meaning that the losses do not happen all at once and individual losses are not severe enough to bankrupt the insurer; insurers may prefer to limit their exposure to a loss from a single event to some small portion of their capital base. Capital constrains insurers' ability to sell earthquake insurance as well as wind insurance in hurricane zones. In the United States, flood risk is insured by the federal government. In commercial fire insurance, it is possible to find single properties whose total exposed value is well in excess of any individual insurer's capital constraint. Such properties are generally shared among several insurers, or are insured by a single insurer who syndicates the risk into the reinsurance market.

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My husband and I have been using the same Independent Insurance Agent for over 15 years and I can't imagine getting insurance from anyone else! I like the personalized service we get. As bad as customer service is everywhere else, it's nice to know that I can go to my local office and get the help I need. I'm rarely put on hold when I call and I'm always helped by a knowledgeable staff member, not someone reading from a script. I've compared our insurance rates with many other companies, and our agent makes sure we get the best insurance for the best price. We've dealt with brokers and captive agents too, but our best experiences have been with Mr. Johnson.
Certain insurance products and practices have been described as rent-seeking by critics.[citation needed] That is, some insurance products or practices are useful primarily because of legal benefits, such as reducing taxes, as opposed to providing protection against risks of adverse events. Under United States tax law, for example, most owners of variable annuities and variable life insurance can invest their premium payments in the stock market and defer or eliminate paying any taxes on their investments until withdrawals are made. Sometimes this tax deferral is the only reason people use these products.[citation needed] Another example is the legal infrastructure which allows life insurance to be held in an irrevocable trust which is used to pay an estate tax while the proceeds themselves are immune from the estate tax.
Whole life insurance is by definition undiversified. You are investing a large amount of money with a single company and relying entirely on their goodwill to give you good returns. The insurance company will make their own investments and then decide what portion of their returns they would like to pass on to their policyholders. You are completely at their whim. If that one company goes bankrupt, has some bad years, or simply changes their outlook on paying out to customers, your return will suffer.
2Partial withdrawals and surrenders from life policies are generally taxed as ordinary income to the extent the withdrawal exceeds your investment in the contract, which is also called the "basis." In some situations, partial withdrawals during the first 15 policy years may result in taxable income prior to recovery of the investment in the contract. Loans are generally not taxable if taken from a life insurance policy that is not a modified endowment contract. However, when cash values are used to repay a loan, the transaction is treated like a withdrawal and taxed accordingly. If a policy is a modified endowment contract, loans are treated as a taxable distribution to the extent of policy gain. On a modified endowment contract, loans, withdrawals and surrenders are treated first as distributions of the policy gain subject to ordinary income taxation, and may be subject to an additional 10% federal tax penalty if made prior to age 59½. Loans, if not repaid, and withdrawals reduce the policy's death benefit and cash value.
The Business Benefits Group is a full-service agency offering affordable, comprehensive insurance strategies for businesses. Our aim is to protect your assets by providing professional risk-management solutions. Whether you are a new or established business, you need the right type of insurance to protect your interests. When you contact BBG regarding our business insurance services, we will determine the best plan for you according to the needs of your business, the number of staff you have, risks that you may be facing, and similar factors. Call our office today to learn more about how we can protect your business or request a consultation online.
Insurance Brokers work the consumer vs. insurance agents who work for the insurance company.  Brokers are very knowledgeable with both personal and commercial insurance. Utilizing state-of-the-art rating software to find the most affordable insurance policies to fit your needs and budget. Insurance Brokers save time, money and energy when shopping for lower cost insurance.
In his memoir “Am I Being Too Subtle?” Sam Zell, a billionaire investor and chairman of Equity International, writes, “I’m always on the lookout for anomalies or disruptions in an industry, in a market or in a particular company…. Any event or pattern out of the ordinary is like a beacon telling me some new interesting opportunity may be emerging.”

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You’re typically asked about your current and past health conditions, and your family health history. The insurer may ask for your consent to get your medical records and may ask you to take a life insurance medical exam. Insurers will also check other data sources to determine term life insurance quotes. More: What you need to apply for term life insurance
This is not an offer of securities in any jurisdiction, nor is it specifically directed to a resident of any jurisdiction. As with any security, request a prospectus from your Registered Representative. Read it carefully before you invest or send money. A Representative from The Business Benefits Group will contact you to provide requested information.
At the same time, the first insurance schemes for the underwriting of business ventures became available. By the end of the seventeenth century, London's growing importance as a center for trade was increasing demand for marine insurance. In the late 1680s, Edward Lloyd opened a coffee house, which became the meeting place for parties in the shipping industry wishing to insure cargoes and ships, and those willing to underwrite such ventures. These informal beginnings led to the establishment of the insurance market Lloyd's of London and several related shipping and insurance businesses.[6]
Often a commercial insured's liability insurance program consists of several layers. The first layer of insurance generally consists of primary insurance, which provides first dollar indemnity for judgments and settlements up to the limits of liability of the primary policy. Generally, primary insurance is subject to a deductible and obligates the insured to defend the insured against lawsuits, which is normally accomplished by assigning counsel to defend the insured. In many instances, a commercial insured may elect to self-insure. Above the primary insurance or self-insured retention, the insured may have one or more layers of excess insurance to provide coverage additional limits of indemnity protection. There are a variety of types of excess insurance, including "stand-alone" excess policies (policies that contain their own terms, conditions, and exclusions), "follow form" excess insurance (policies that follow the terms of the underlying policy except as specifically provided), and "umbrella" insurance policies (excess insurance that in some circumstances could provide coverage that is broader than the underlying insurance).[32]
Back to guaranteed growth…. Whole Life policies are interest rate driven based on the economy, but your “Cash Account” will increase every year, regardless of the market. Compound, tax-free growth. The dividends paid to the policy owners are also not taxable. Dividends are not guaranteed, but take a look at the dividend history for companies like Mass Mutual, Penn Mutual and Guardian. They might as well be guaranteed.

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Whole life is insurance not an investment. You buy it so the day you pass on your family will have money to ease their grieving by giving them time off, financial security, and most importantly for whole life insurance to pay the cost of your funeral, etc. It can mean a lot to people to have a nice funeral for their loved one as a proper send off. I view whole life as a product, like my house, which I also don’t view as an investment.
Annuities provide a stream of payments and are generally classified as insurance because they are issued by insurance companies, are regulated as insurance, and require the same kinds of actuarial and investment management expertise that life insurance requires. Annuities and pensions that pay a benefit for life are sometimes regarded as insurance against the possibility that a retiree will outlive his or her financial resources. In that sense, they are the complement of life insurance and, from an underwriting perspective, are the mirror image of life insurance.
In determining premiums and premium rate structures, insurers consider quantifiable factors, including location, credit scores, gender, occupation, marital status, and education level. However, the use of such factors is often considered to be unfair or unlawfully discriminatory, and the reaction against this practice has in some instances led to political disputes about the ways in which insurers determine premiums and regulatory intervention to limit the factors used.

Are you asking about people with terminal illnesses? If so, then I’ll admit that my knowledge in that particular area is limited. But my understanding is that a term policy would be very difficult if not impossible to find and there are some special kind of whole life policies you may be able to get. If that’s the situation you’re asking about, then it’s really not a whole life vs. IRA decision. It’s a decision on whether you should invest or whether you should insure. That’s a very different question than what’s being discussed in this article.

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If you have a persuasive personality, a strong aptitude for working with numbers and a desire to help others, you might enjoy a career as an insurance salesperson. Your options include a path as an insurance broker or insurance agent. While both occupations involve the sale of insurance policies, there are also some important differences to consider.
There are a number of explanations for this difference, including fees and the way in which the interest rate is applied. But the bottom line is that you can’t take that “guaranteed return” at face value. It is incredibly deceptive. Run the numbers for yourself and see if you’re happy with the result. The reality is that you can often get better guaranteed returns from a savings account or CD that’s also FDIC insured.
The first is that, as you say, no one invests all their money at the beginning of the period and cashes out at the end. Usually you invest some at the beginning and more at various points along the way. For example, someone who contributes part of their monthly paycheck. And since the stock market generally goes up, that means that you will inherently get lower returns than if you had invested all of your money at the beginning, simply because some of your money will not have been invested for the entire ride.

This isn’t entirely accurate. Whole life insurance isn’t a product designed to replace term insurance. It wouldn’t make sense to have a retirement account disappear in the event of someone passing early. This would be irresponsible on the part of an agent to suggest this. Whole life has to be used with the intent of using it as collateral for loans, enhanced retirement and for leaving a legacy. In the early years it should be set up with a term rider to ensure a family’s needs will be met. Yes this is more expensive but it is a tool with an objective and if that’s not the objective then whole life makes no sense at all. It is not right for everyone.
Second, what that means is that your decision should be based solely on how you expect each option to perform going forward. You can evaluate what you expect to get from the whole life policy going forward vs. what you might expect from other options, and then decide which options give you the best chance of achieving your personal goals. I can’t honestly answer that question for you, but I hope some of the information in this article and others throughout the site do give you a sense of your options.
Muslim scholars have varying opinions about life insurance. Life insurance policies that earn interest (or guaranteed bonus/NAV) are generally considered to be a form of riba[60] (usury) and some consider even policies that do not earn interest to be a form of gharar (speculation). Some argue that gharar is not present due to the actuarial science behind the underwriting.[61] Jewish rabbinical scholars also have expressed reservations regarding insurance as an avoidance of God's will but most find it acceptable in moderation.[62]
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An insurance broker is experienced in different types of insurance and risk management. They help individuals and companies procure insurance for themselves, their homes, their businesses or their families. Brokers may focus on one particular type of insurance or industry, or they could provide advice on many different types of insurance. They provide a service to their customers in helping them find and buy insurance — usually at no cost to their client.

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Auto insurance isn’t only great protection for your vehicle, it’s also the law. All states require some degree of insurance for your vehicle to protect you and other motorists. Coverage requirements will vary based on your financial responsibility for your car and your state’s requirements. Some states even require you to have liability insurance before you even get a license.


Marine insurance and marine cargo insurance cover the loss or damage of vessels at sea or on inland waterways, and of cargo in transit, regardless of the method of transit. When the owner of the cargo and the carrier are separate corporations, marine cargo insurance typically compensates the owner of cargo for losses sustained from fire, shipwreck, etc., but excludes losses that can be recovered from the carrier or the carrier's insurance. Many marine insurance underwriters will include "time element" coverage in such policies, which extends the indemnity to cover loss of profit and other business expenses attributable to the delay caused by a covered loss.
They cannot provide you with any final answers. Calculators only allow you to perform "hypotheticals," recalculating and generating new results as you make and input new assumptions. Using these tools and educating yourself on the workings of life insurance and other financial products, however, can help you feel more comfortable when discussing your needs with professionals like a New York Life agent.

The questions we ask on our site are used only to determine which insurance companies and products best match your unique needs. Each insurance company bases its final prices on its own criteria. To more accurately match you with the best company, product and policy for your needs, we gather some general health, lifestyle, family history, and contact information on our site. A licensed representative will then review your submission and, if necessary, either call or email you to clarify any outstanding issues and provide you with the information you request.
Progressive Home Advantage® policies are placed through Progressive Specialty Insurance Agency, Inc. with affiliated and third-party insurers who are solely responsible for claims, and pay PSIA commission for policies sold. Prices, coverages, privacy policies, and PSIA's commission vary among these insurers. How you buy (phone, online, mobile, or independent agent/broker) determines which insurers are available to you. Click here for a list of the insurers or contact us for more information about PSIA's commission. Discounts not available in all states and situations.
Are you asking about people with terminal illnesses? If so, then I’ll admit that my knowledge in that particular area is limited. But my understanding is that a term policy would be very difficult if not impossible to find and there are some special kind of whole life policies you may be able to get. If that’s the situation you’re asking about, then it’s really not a whole life vs. IRA decision. It’s a decision on whether you should invest or whether you should insure. That’s a very different question than what’s being discussed in this article.
Nice write up. I personally have been able to save with an independent agent. A big concern of mine was finding an agent that worked with more reputable insurance carriers. There seems to be alot of agents who will use non-standard insurance carriers to provide cheaper coverage. I've heard some horror stories about customer service, sub-par adjustments, and claims services. I'd definitely do alot of research into the insurance companies the independent agent is appointed with.
The benefit to you is enormous. Boomer Benefits provides back-end policy support that you cannot get directly from an insurance company and that none of our competitors offer: a dedicated Client Service Team for our existing policyholders only with 10 full-time employees on call to immediately fix very common Medicare hiccups which are otherwise stressful for you.

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Collision and comprehensive only cover the market value of your car, not what you paid for it—and new cars depreciate quickly. If your car is totaled or stolen, there may be a “gap” between what you owe on the vehicle and your insurance coverage. To cover this, you may want to look into purchasing gap insurance to pay the difference. Note that for leased vehicles, gap coverage is usually rolled into your lease payments.


Your premise is that whole life insurance is a bad investment. Fine, however, it is not a bad purchase. It is insurance and when thinking about the defined purpose of insurance then it can be a different story. Your electric service is a bad investment but think of the difficulty in living without electricity. Sure you could invest the bill amount each month into a nice Roth IRA but we seek the benefits of the service and willingly pay the bill. I suggest that people look at insurance the same. In my case and for my intent, whole life insurance was prudent. Like any car lease deal or stock purchase, there can be good and bad deals; one should not declare all forms at all points in time to be definitive. I gifted my child a whole life policy. The rates for a young person are as good as they get; she will never have insurance bills nor be without insurance. There is much left to explain but in short her $25,000 baby policy is growing $1,000 per yea. She will never have to pay a premium but will have $225,000-$350,000 payout one day while providing some protection also during the income/mortgage/child rearing adult years because I purchased it for her at the cost of $120.25 per year! No way could a poor farm kid without inheritance or wealth and limited income but high student loan debt create that kind of wealth for his children in the immediate or most vulnerable time period. To leave her in the same boat, as my parents did, is in no way wealth building. I got married and had mortgage, student loans, and large term life insurance bills because to go without any seemed irresponsible having no wealth but whole life was too expensive. So yes, it is far from a great investment but it is the most responsible gift I ever gave my child. It will not depreciate like a car and it is more certain than lottery tickets! Could I really produce that protection for her with liquidity via investing for only $120 per year? Tip: an insurance agent once told me (he should not have mentioned it) they have NEVER paid out on a life insurance policy because people always eventually let them expire and quit paying on them. Rates are so cheap for young healthy people because they are not likely to die. So this is also an exercise in discipline and responsibility not just finding the right stream to pan for gold.


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An insurance broker is experienced in different types of insurance and risk management. They help individuals and companies procure insurance for themselves, their homes, their businesses or their families. Brokers may focus on one particular type of insurance or industry, or they could provide advice on many different types of insurance. They provide a service to their customers in helping them find and buy insurance — usually at no cost to their client.

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If she still needs the insurance, then you’re right that she may just be stuck between a rock and a hard place. I have some independent insurance experts that I work with and could potentially run it by them just to see what the options might be. If you’d like to talk things over in more detail, please feel free to email me directly at matt@momanddadmoney.com, or you can call me at 850-426-4034.
Well, actually, that was a fairly slanted article from someone who is advocating in his best interest from his point of view. Most Brokers are highly ethical and Brokers (not agents) DO have a fiduciary responsibility to their clients. Most CFO’s also do not allow their Brokers to “last minute” them nor have an uncontrolled process. One of the biggest problems is not the Broker or Agent, but divisional reluctance to co-ordinate safety and loss prevention efforts WITH the CFO so that the CFO has a basis to negotiate with first of all, and for the organization to take a portion of it’s risk and self-insure where financially appropriate. For example, the adoption of telematics in fleets has moved very slowly and their is no good reason for proactive management to have allowed that to happen. That takes proactive risk management and coordination which is why many CFO’s have a risk manager position in their department.
Did someone say convenient? Life can be complicated, which is why we make insurance so easy. Our customer service is accessible and personal. You can choose from different payment options, and you’re able to manage your account online for anytime, anywhere access. Just in case you want to view your policy at 2 a.m. while on vacation. Not that you would, but you could.
Hi James. Sorry for the late reply! So I’ll be honest that I’m not an expert on this exact strategy, but my understanding is that it’s generally something you might look to implement later in life, closer to when you’re actually making the decision about what type of pension payout you want. That’s simply because there are a lot of variables involved that could make it either more or less advantageous, and if you’re in your early 30s it’s just hard to know what all of those variables will look like 30 years down the line.
I have worked in the Banking Business for over 7 years. After years of working for a company/corporation, I decided to start my own business in the same business field. I am now a Financial specialist with New York Life Insurance Company for almost 2 years. I get to do the same thing as before but now I’m running my own business. Trust is everything and I make it my mission to earn my clients trust.

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And I agree with you Matt. People that just try to make a buck on someone else’s loss or something they truly can’t afford is despicable to me. And I apologize for my “are you licensed?” Comment. Your actually doing a noble thing as a father and informing people that need to hold on to what they can or invest it correctly in this economy. I have a lot of business owners and high end clients and I sell them whole life for a ton of reasons. But for my blue collar average joe or even white collar for that matter, I just wanna take care of them and their families. They’re not my customers their my clients. And that’s drilled into us by New York Life, I hope you have continued success in your Financial Planning career. God bless you.
When insured parties experience a loss for a specified peril, the coverage entitles the policyholder to make a claim against the insurer for the covered amount of loss as specified by the policy. The fee paid by the insured to the insurer for assuming the risk is called the premium. Insurance premiums from many insureds are used to fund accounts reserved for later payment of claims – in theory for a relatively few claimants – and for overhead costs. So long as an insurer maintains adequate funds set aside for anticipated losses (called reserves), the remaining margin is an insurer's profit.
Studies have shown that roughly half of a stock's price movement can be attributed to a stock's industry group. In fact, the top 50% of Zacks Ranked Industries outperforms the bottom 50% by a factor of more than 2 to 1. By focusing on the top stocks within the top 50% of Zacks Ranked Industries, you can dramatically improve your stock picking success.
Still, although I believe that persons without adequate income either to fund adequately retirement vehicles or to pay monthly bills without using a home equity line of credit or leaving any credit card balances unpaid, should probably only purchase term insurance, if you earn more than that, I am thinking that purchasing 15% to 25% of needed life insurance coverage though whole life policies may be a way to mitigate against the needed guessing that goes into picking the length and amount of term policies. Do you agree?
Here are a few more important items to keep in mind when dealing with Agents and Health Insurance: * There is no cost to using a Broker or Independent agent. If an agent helps a client purchase a plan with a specific company, the insurance company will pay the agent a small stipend each month in which the health insurance plan is kept in place. * With Affordable Care Act - ACA in effect insurance companies are dropping the multiple network option for more specific smaller networks, or only one network. Agents, whom do their job correctly, will help to make sure that your doctor is in network with the insurance company that you choose. * If you work with a Captive Agent make sure to check other options with non-captive agents so that you have all the information you need to make an informed decision. * Using an Agent as your personal representative should go beyond just purchasing a plan. When you have an issue with if a doctor is on a plan or if your medications are covered you should be able to refer back to your agent for help in getting these issues answered or resolved. A good agent will go above and beyond just "selling" a plan to you. * Agents are aware of the Open Enrollment times in which you can change plans. A good agent will send an email out reminding their clients each year that now is the time to move plans or insurance companies since there is only a small period of time (Open Enrollment in the Fall) in which you may move to a different insurance company each year for a Jan 1st effective date. * Each year when rates increase Brokers and Independent Agents will be able to see all the companies rates and plans for the new year and help you decide if you should move to a new insurance company or plan for the new year *Agents are aware of what a Qualifying Event is and if you can change plans each year, how to do that and what is required. With all the knowledge agents possess...why not take advantage of free!

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In the United States, brokers are regulated by the state (or states) in which they work. Most brokers are required to have an insurance broker license, which involves taking courses and passing an examination. Each state has different requirements for insurance brokers, which a broker must meet to be licensed in that state. Most states require insurance brokers to take continuing education courses in order to maintain their license.
Premiums paid by the policy owner are normally not deductible for federal and state income tax purposes, and proceeds paid by the insurer upon the death of the insured are not included in gross income for federal and state income tax purposes.[28] However, if the proceeds are included in the "estate" of the deceased, it is likely they will be subject to federal and state estate and inheritance tax.
Once you write the check, it’s insurance company money. After some time, you may have the right,to borrow some money from them. They decide how much insurance they will pay and how much you can borrow. Let’s take a look at what they have named a universal policy. Let’s say you want to get the savings started right out the door. So you write them a check for $5000. Next month you have an emergency an ,you kneed $25.0/0. Too bad! In a few years, you’ll have a few dollars in cash value. First year or two – none! Now let’s say they have have a guaranteed return of 4%. N ow if you actually have a “cash value” of some kind, don’t you think there would be something there? 4% of WHAT = $0 ??? It’s all insurance company money – they said so to the US government in 1985.
In the United States, economists and consumer advocates generally consider insurance to be worthwhile for low-probability, catastrophic losses, but not for high-probability, small losses. Because of this, consumers are advised to select high deductibles and to not insure losses which would not cause a disruption in their life. However, consumers have shown a tendency to prefer low deductibles and to prefer to insure relatively high-probability, small losses over low-probability, perhaps due to not understanding or ignoring the low-probability risk. This is associated with reduced purchasing of insurance against low-probability losses, and may result in increased inefficiencies from moral hazard.[52]
The insurance agents at Boomer Benefits work full-time on Medicare-related insurance products. That means our agents are not distracted by trying to sell other specialty forms of insurance. Because of this, we feel confident that our staff members are among the most well-educated Medicare insurance brokers around. We are hands-down the best Medigap insurance broker that we can be.
State Farm (including State Farm Mutual Automobile Insurance Company and its subsidiaries and affiliates) is not responsible for, and does not endorse or approve, either implicitly or explicitly, the content of any third party sites hyperlinked from this page. State Farm has no discretion to alter, update, or control the content on the hyperlinked, third party site. Access to third party sites is at the user's own risk, is being provided for informational purposes only and is not a solicitation to buy or sell any of the products which may be referenced on such third party sites.
Hi, Matt. My parents are actually talking to an agent to get the whole life insurance and their premium monthly is about $1000 so which makes them to pay $120000 (since it’s the 10 yr plan) and the agent presented that the guaranteed value will be $250000. I have very little knowledge about the whole life insurance plan but wouldn’t it be easier for them to just get it and be insured with that guaranteed value if they are not the type to find where to invest and all that? or is it something that they shouldn’t relay on.. they are doing it for more their retirement and asked me for help but i am very confused about this whole life plan. Thanks!
In any case, I thought I might chime in given that I disagree with your statement about all of these policies being legal robbery. As a disclaimer, I should point out that I agree that unscrupulous life insurance agents definitely do have a tendency to oversell these policies where term life would do, and I do not disagree that commissions are often the likely motivation in many of these cases.
While you won’t be able to pinpoint the amount you’ll need to the penny, you can make a sound estimate.  Your goal should be to develop a life insurance plan that, following your death, will allow your family to live comfortably without your economic contribution. Also consider the effect of inflation over time. The amount needed for retirement or college 20 years from now is likely to be significantly higher than today.

4The monthly rate shown is for Preferred Elite based on a Male, age 37, and a 20-year level term period. Terms and limitations will apply. Rates shown are monthly as of January 1, 2018. Allstate TrueFit® is a term life insurance to age 95 policy issued by Allstate Assurance Company, 3075 Sanders Rd., Northbrook IL 60062 and is available in most states with contract/series ICC14AC1/ AC14-1. In New York, issued by Allstate Life Insurance Company of New York, Hauppauge, NY with contract/series NYLU818. The premiums will be the same for the level term period selected. Beginning with the anniversary following the level term period, the company reserves the right to change premium rates each policy year, but rates cannot be more than the maximum guaranteed amounts stated in the policy.
Definite loss: The loss takes place at a known time, in a known place, and from a known cause. The classic example is death of an insured person on a life insurance policy. Fire, automobile accidents, and worker injuries may all easily meet this criterion. Other types of losses may only be definite in theory. Occupational disease, for instance, may involve prolonged exposure to injurious conditions where no specific time, place, or cause is identifiable. Ideally, the time, place, and cause of a loss should be clear enough that a reasonable person, with sufficient information, could objectively verify all three elements.
Boomer Benefits’ office is easy to find on Google places. We are staffed Monday – Friday and some Saturdays so that you can reach us by phone, email, or in person when you need help. Some agents who sell Medicare products work by themselves out of their homes. Unfortunately, that means that whenever the agent is in a meeting with another client, your call goes straight to voicemail. Who knows how long you will wait for a return call? It’s in your best interest to work with a bigger Medicare broker that has numerous representative standing by to take your call. Our agents will know you and care about you.
But a question for you. Do you have clients that have had an overfunded life policy when markets are tanking and can use that cash to float their business and still earn money while their money is loaned out? Talk about a winner. I have a lot of clients that are in business today because of their policies (and the people still employed). Especially when the interest can be written off. But then again some super conservative clients love them. I guess I’m just bummed you didn’t go any further but I am on a site not geared for my clientele. So here is another free post to build up the conversation and the controversy so you can cash in on the traffic.
To echo what everyone else has said, great article! My wife and I were pitched this idea earlier today and I thought it sounded great until she made me read this article. I then returned to the paperwork they had given me to find it riddled with “these values are not guaranteed”. The footnotes even went as far as to say these projections were based on their dividend schedule for 2014 and that future years could be “higher or lower” and the went on to recommend looking at a hypothetical lower schedule illustration available upon request. My question for you is in regards to your conclusion. I’m self employed and put 30k into a sep-Ira and also utilize a tIRA->Roth conversion for my wife. You said this might be worth it if it was ossicle to front load the plan, the one I was presented with called for 15k/yr. are you saying it would be worth hit if I could put say 30-45k into each of the first few years? I’d still be a little skeptical after reading the brochure where it says the dividends are essentially at the discretion of he carrier
Good question Eski. I would encourage you to look into long-term disability insurance as a potentially more effective way to provide coverage for the exact risk you’re talking about. In general you’ll get better, more comprehensive coverage from a disability insurance policy that’s specifically designed for this than from a life insurance policy that includes it as a limited add-on.
Full Circle, one time I thought whole life insurance was great. Then I cashed it in, bought at least 5 new automobiles, a house, a couple motorcycles and more bullshit. Then I learned how to properly use life insurance as a bank, instead of borrowing money from a bank, I borrow the money from myself and pay myself back what I would have paid banks. I get to collect all the interest I would have paid the banks. I get to grow my money tax free. I get to pass my hard earned money on to my family tax free. The key is understanding Whole life vs creating your own banking system.

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The first life table was written by Edmund Halley in 1693, but it was only in the 1750s that the necessary mathematical and statistical tools were in place for the development of modern life insurance. James Dodson, a mathematician and actuary, tried to establish a new company aimed at correctly offsetting the risks of long term life assurance policies, after being refused admission to the Amicable Life Assurance Society because of his advanced age. He was unsuccessful in his attempts at procuring a charter from the government.
7Variable universal life products are long-term investments designed to provide life insurance protection and flexibility in connection with premium payments and death benefits. You should carefully consider the investment objectives, risks, charges, and expenses of the investment alternatives before purchasing a policy. These policies have limitations and are sold by prospectus only. The prospectus contains details on the investment alternatives, policy features, the underlying portfolios, fees, charges, expenses, and other pertinent information. To obtain a prospectus or a copy of the underlying portfolio prospectuses, please contact Allstate Assurance Company. Please read the prospectuses carefully before purchasing a contract.
For all of the above advantages, I believe the actual returns seen were far less then the 8% a year on the simulation. The reason was probably fees similar to Reason#2 in the above article. I wish I had the tables that were presented so I could verify this (I have asked my friend for the tables). At any rate, after my reading, I am leaning toward not purchasing this product because it seems to give weaker results (after fees) compared to other tax advantaged and non tax advantaged investment accounts which I have barely begun to invest in. It may be useful in some cases if all the better investments have been maximized and one is looking for a tax free long term low yield conservative investment account that allows one to withdraw tax and interest free and provides a life insurance payout in the event of death.
Annuities provide a stream of payments and are generally classified as insurance because they are issued by insurance companies, are regulated as insurance, and require the same kinds of actuarial and investment management expertise that life insurance requires. Annuities and pensions that pay a benefit for life are sometimes regarded as insurance against the possibility that a retiree will outlive his or her financial resources. In that sense, they are the complement of life insurance and, from an underwriting perspective, are the mirror image of life insurance.
In times of need, we stand by you. We’re here to make sure you have the right coverage for your needs. And should an accident occur, our claims service will be there to help when you need it most. If you’re comparing our quote or policy to another insurer, be sure to understand the value of the coverage you’re considering. Compare apples to apples. Make sure driver and vehicle information are the same. Our auto policy is the only one backed by an On Your Side promise.
Advanced economies account for the bulk of global insurance. With premium income of $1.62 trillion, Europe was the most important region in 2010, followed by North America $1.409 trillion and Asia $1.161 trillion. Europe has however seen a decline in premium income during the year in contrast to the growth seen in North America and Asia. The top four countries generated more than a half of premiums. The United States and Japan alone accounted for 40% of world insurance, much higher than their 7% share of the global population. Emerging economies accounted for over 85% of the world's population but only around 15% of premiums. Their markets are however growing at a quicker pace.[40] The country expected to have the biggest impact on the insurance share distribution across the world is China. According to Sam Radwan of ENHANCE International LLC, low premium penetration (insurance premium as a % of GDP), an ageing population and the largest car market in terms of new sales, premium growth has averaged 15–20% in the past five years, and China is expected to be the largest insurance market in the next decade or two.[41]

The insurance company calculates the policy prices (premiums) at a level sufficient to fund claims, cover administrative costs, and provide a profit. The cost of insurance is determined using mortality tables calculated by actuaries. Mortality tables are statistically based tables showing expected annual mortality rates of people at different ages. Put simply, people are more likely to die as they get older and the mortality tables enable the insurance companies to calculate the risk and increase premiums with age accordingly. Such estimates can be important in taxation regulation.[10][11]


Life insurance can be very confusing. What is term life insurance? What is whole life insurance? How can you get the information you need and make the right decision about life insurance for you and your family or other beneficiaries? We’ll provide an overview of these two popular types of life insurance so you can get an idea of what might be a good fit for you. Find out more by contacting an insurance agent in your area.
“In the policy that was attempted to be sold to me, the “guaranteed return” was stated as 4%. But when I actually ran the numbers, using their own growth chart for the guaranteed portion of my cash value, after 40 years the annual return only amounted to 0.74%. There are a number of explanations for this difference, including fees and the way in which the interest rate is applied.”
These reviews are all from Medicare beneficiaries just like you. Our clients consistently rate us 5 stars for both our up-front help, but also the phenomenal back-end support you get from our Client Service Team. We have some of the very best Medicare supplement agents in the country. These independent Medicare advisors truly care. You can read our reviews here. Notice how many of them are from clients who called us when Medicare denied their claim or rejected their bills or their doctor mis-codes a service or when they are standing at the pharmacy and can’t get their medication. Normally you would call the insurance company yourself to try to figure out how to fix these things.

2)The lack of cash flow flexibility is troubling in that the largest assumption driving my analysis is that I am able to continue paying the premiums and keeping my policy current. If I want to take time off for travel (which is a near-term goal) or lose my job before this becomes self-funding, the policy can lapse and I would get only the cash surrender value at what is most likely a loss depending on timing
Through these educational requirements and experience in the field, brokers gain a significant level of knowledge in insurance. They are well informed about specific types of insurance and how claims of a particular type are covered. For example, a broker can explain to an individual exactly what types of risks a homeowner’s insurance policy will cover and what it will exclude (such as acts of god, intentional acts, negligent acts, slip and falls, loss of theft of valuable items, etc.). With this knowledge, clients can make better informed choices about what type of insurance they need, along with how much coverage is necessary. This is a broker’s job: to help clients understand the liabilities that they have and how those risks can be adequately managed through insurance. Brokers can then help clients review a number of insurance options to pick the policy and premium that best fits their needs and budget.
An insurance broker is experienced in different types of insurance and risk management. They help individuals and companies procure insurance for themselves, their homes, their businesses or their families. Brokers may focus on one particular type of insurance or industry, or they could provide advice on many different types of insurance. They provide a service to their customers in helping them find and buy insurance — usually at no cost to their client.
Gap insurance covers the excess amount on your auto loan in an instance where your insurance company does not cover the entire loan. Depending on the company's specific policies it might or might not cover the deductible as well. This coverage is marketed for those who put low down payments, have high interest rates on their loans, and those with 60-month or longer terms. Gap insurance is typically offered by a finance company when the vehicle owner purchases their vehicle, but many auto insurance companies offer this coverage to consumers as well.
Although some aspects of the application process (such as underwriting and insurable interest provisions) make it difficult, life insurance policies have been used to facilitate exploitation and fraud. In the case of life insurance, there is a possible motive to purchase a life insurance policy, particularly if the face value is substantial, and then murder the insured. Usually, the larger the claim, and the more serious the incident, the larger and more intense the ensuing investigation, consisting of police and insurer investigators.[30]

When the market experiences “down years” you will want to used a fixed investment to take your distributions in order to give your market-exposed vehicles time to recoup losses. This is one of the best pieces I have seen regarding “Taming a Bear Market” where one uses whole life insurance to supplement 401(k) distributions in bad years: http://www.becausewearewomen.com/documents/LEGACY10-RETIREMENTSUPP.pdf
Also a comment on the “non-guaranteed” argument. Yes if you do business with a company not named Mass Mutual, Northwestern Mutual, or New York Life, you are likely getting ripped off. But if you work with a reputable company, they have paid dividends every year for 150+ years. So yes, legally speaking, returns are not guaranteed, but every year for 150 years sounds pretty good to me. Just as asset class diversification is important, so is tax and risk diversification, which permanent insurance provides.
2)The lack of cash flow flexibility is troubling in that the largest assumption driving my analysis is that I am able to continue paying the premiums and keeping my policy current. If I want to take time off for travel (which is a near-term goal) or lose my job before this becomes self-funding, the policy can lapse and I would get only the cash surrender value at what is most likely a loss depending on timing
Moreover, with hindsight, because I suspect that the conversion options in the term policies, as I look into them, won’t prove all that attractive, I am thinking that it would have been optimum to have had universal or whole life coverage for closer to 20% of our aggregate, total original insurance coverage, rather than 10%. Still, while I am pretty satisfied that my prior decision-making was close to right, I do wonder if you see this all very differently.
As for your question, USAA is a fantastic company and I would happily recommend them for many things, like auto, home, and umbrella insurance. With that said, I have never reviewed one of their whole life insurance policies and therefore can’t really comment on that specifically. I will say that I would be careful about taking that 4.5% return at face value, as I describe in the post. I would encourage you to run the numbers for yourself to see what it really comes out to.

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