Low interest rates: for a significantly long period have had a serious impact on the investment results of permanent life insurance contracts.
Older contracts should be stress tested: New contracts have been injected with a guarantee of the death benefit to the investment performance concern.
But Guaranteed Life comes with some hurdles. Guarantees are set to keep the contract in place to age 100, and in some instances age 125.
- premiums need to be paid on time. Is there a chance an 80 year old policy holder might be late or miss?
- there is no skipping premiums
- cash value, if any, disappears early and cannot be used as a back stop
An end result of an insured’s policy inadvertently lapsing is a concern and steps should be taken to prevent this outcome.
If you have a policy needing stress testing or clarification of the term of a guarantee, Shepard Insurance can help.