Life insurance actuary spills beans about Indexed Universal Life

Many moons ago, Yours Gluteny was a Managing General Agent for the oldest insurance company in the world.

Now before you OoOoOoOo and "awwwww", my agency was in a small jerkwater town so... big fish in a little pond.

Tiny pond actually.

More like a mud puddle.

Anyway, the title doesn't mean a hill o beans...

The reason I bring it up is because it gave me opportunities I otherwise wouldn't get.

Example: One of the coolest people I met during that time was Jason Konopik, who is one of the most well-known actuaries in the life insurance industry.

Why he so important?

He designed (or helped design) many of the indexed universal life products on the market.

And... he just so happened to (also) create some of the indexed universal life (IUL or Indexed UL) products at the insurance company I was contracted with...

One time he and I are chatting on the phone and he emails me a custom spreadsheet of his where he had worked out investment potential for many of the players in the life insurance industry.

So anyway... most of the companies were overselling (overpromising) on their indexed UL policy illustrations and under-delivering on actual policy returns.

Have things gotten better since then?

Well...

Jason wrote an article a few years back (the intended audience was insurance agents) to update us all on the state of affairs.

In it he said, "IUL is a non-guaranteed product, and as an actuary who has worked with the pricing actuaries at many carriers, I can guarantee you one thing: Insurance companies won’t lose money on a non-guaranteed product. What this means is that this carrier will make up for losses they are incurring…by lowering cap rates on their indexed crediting strategies...

"... From time to time, life insurance companies come out with policy benefits that can significantly reduce an individual client’s risk by spreading that risk over all their customers. This isn’t one of those times! In today’s environment it is more important than ever that agents truly understand what they are selling. Otherwise you will be making promises to your clients that will never be realized.”

Let me tell you something...

I've spoken with A LOT of insurance agents and even investment advisors now who are making promises that they know they can't keep (and sheepishly admit it when pressed hard enough).

Do with that info what you will.

Me?

I prefer to keep things simple.

Here's why: neither you (nor I) knows what will happen in 20 or 30 years.

What if I get hit by a car next year and am not here to help you if you get into trouble later on?

Wouldn't you like a plan so simple, you could manage it yourself?

Yes?

When you're old and gray... wouldn't you like to spend your precious time worrying about which country you're going to visit... who you're going to spend your day with... what museum you're going to visit... who you're going to take hiking or bowling or whatever?

(instead of worrying about whether you can pay your utility bills?)

 

Hop on my email list and I'll show you how it's done.

David Lewis

This post brought to you by //The Rogue Agent//. David has been a life insurance agent, and worked with some of the oldest and most respected mutual life insurance companies in the U.S., since 2004. Learn more about him and his business, here.

This post brought to you by //The Rogue Agent//. David has been a life insurance agent, and worked with some of the oldest and most respected mutual life insurance companies in the U.S., since 2004. Learn more about him and his business, here.