When purchasing a life insurance policy, the potential to achieve a higher rate of return than a fixed-rate product has made variable life insurance an increasingly attractive option for consumers over the last two decades. With the option to invest the policy’s cash value in separate accounts (commonly referred to as “sub-accounts”), which function similar to mutual funds, policy owners can participate in gains from [...]
Dividends are a return of premium when carrier results exceed a very conservative projection for investments, income, and expenses. Dividends are paid annually on participating whole life insurance and determined at the discretion of the board of directors. They are paid in addition to the guaranteed cash values in the policy, but the dividends themselves are not guaranteed and will fluctuate. Over the last twenty [...]
In the 1980s when current assumption universal life (CAUL) hit the market, sales illustrations were created showing cash value returns of 10% and more every year – for a product that was invested in fixed instruments. When equity markets soared and variable universal life (VUL) became the rage, many sales illustrations projected 12% returns – again, every year. Life insurance illustrations are at best a [...]
An online survey about life insurance found that 33% of life insurance policy owners do not understand how their policy works. (1) I suspect that this number is probably low. Perhaps the other 67% think they know how it works, but I imagine they could get a refresher lesson. Even if a policy owner does understand how it works, do they understand how a decade [...]
Millions of businesses worldwide have drafted or purchased business continuity plans, some have even practiced or simulated implementation of said plans, but few ever dreamed a worldwide pandemic would force these plans into action. The rapid spread of the Covid-19 virus has impacted all of humanity, including thousands of businesses which include fiduciary services. For those who serve as a fiduciary or provide fiduciary support [...]
A TOLI trustee we work with received a request from a grantor tired of gifting to pay premiums on his portfolio of whole life policies. His agent suggested that the three policies be replaced with one policy with a reduced death benefit. The existing portfolio totaled $5.7 million of coverage. The agent proposed transferring the $2.1 million of cash value into a $3 million equity [...]
Sally Wylie, a retiree living on an island in Maine, was stunned when her long-term care (LTC) policy premium almost doubled. According to the Wall Street Journal article that recounted her dilemma, the one-time learning specialist took on part-time work to help with the finances, and she and her husband cut back on expenses to afford the premium for the policy that was purchased to [...]
On August 1st of this year, RIC joined the Longevity Holdings family of companies. RIC is a leading provider of fiduciary risk management solutions for institutional trustees and wealth management organizations. Longevity Holdings is also the parent company of ITM TwentyFirst. Both ITM TwentyFirst and RIC provide industry leading solutions for Trust Owned Life Insurance. This combination will ensure that we can continue to build on [...]
In the last two posts, we explained the popularity of the equity index universal life policy, as well as the mechanics of the policy. While the policy is tied to an equity index, it is a fixed product, with the bulk of the premium going into the carrier’s general account to satisfy the floor and the balance – a much smaller amount – going [...]
Last month, ITM TwentyFirst was proud to sponsor FIRMA’s (Fiduciary & Investment Risk Management Association) 35th Annual National Training Conference in Nashville, TN. This marks the 16th consecutive year ITM TwentyFirst has sponsored this important industry event for trust fiduciary risk, compliance and audit professionals, and this year’s event represented the first in-person event since 2019. FIRMA’s Executive Director, Hale Mast, reflected on the [...]
