1. “Life as we know it” Exploring the different types of life insurance

2. Today’s Agenda…
A History Lesson
Whole Life
Term Life
Universal Life

3. The history of life insurance

4. Life history…
The Presbyterian Synod of Philadelphia sponsored the first life insurance corporation in America for the benefit of Presbyterian ministers and their dependents.
1837 – The Panic of 1837 leads to Mutualization of Life Insurance between 1838 – Met Life, New York Life, Mass Mutual and John Hancock all formed.
1858 – A.P. Giannini, the founder of Transamerica, brings life insurance and financial services to the “common man”.
1861–1865 – The Civil War leads to the creation of Non-Forfeiture Laws.

5. Life history continued…
1930s – Life Insurance reaches a peak before Great Depression when 120 million policies are in place…a 1:1 ratio to the amount of people living in the US at the time.
1965 – Serviceman’s Group Life Insurance (SGLI) formed This is also when the concept of “Buy Term and Invest the Difference” was formed.
1977 – A.L. Williams founds A.L. Williams and Associates under the BTID Concept (later became Primerica).
1979 – E.F. Hutton pioneers “Total Life”…also known as Universal Life.

6. WL
Whole Life Insurance

7. Whole Life history…
1837 – The Panic of 1837 leads to Mutualization of Life Insurance between 1838 – Met Life, New York Life, Mass Mutual and John Hancock all formed.
1858 – A.P. Giannini, the founder of Transamerica, brings life insurance and financial services to the “common man”.
1861–1865 – The Civil War leads soon after to the creation of Non-Forfeiture Laws.

8. Whole Life Quick Facts…
Fixed, Level Premium
Guaranteed Death Benefit to Age 121
Endowment…Cash Value = Death Age 121
Guaranteed Cash Values
Guaranteed Insurability through OPAIs
Ages 25, 28, 31, 34, 37 & 40
Contingent, Marriage & Stork Options
Guaranteed Non-Forfeiture Values
Reduced Paid-Up Insurance
Cash Value
Extended Term Insurance

9. More on OPAI… OPAI – Option to Purchase Additional Insurance
Client has the opportunity to purchase additional insurance at pre-determined option dates AND without proof of insurability
Standard Option Ages 22, 25, 28, 31, 34, 37 & 40
Contingent Option Ages 43, 43 & 49
Marriage & Stork Options
Separation of Service / Retirement Option
Conversion option amounts
Vary by carrier
May typically convert a minimum of $5k and up to the OPAI option face amount

10. More on Non-Forfeiture Options…
Guaranteed Cash Values
Reduced Paid-Up
Client stops paying premiums
Death Benefit is reduced
Cash value continues to grow
Extended Term Insurance
Death Benefit remains level but only lasts for a specified period of time
Cash Value goes away

11. Whole Life …

12. Whole Life … Policy Endows @ Age 121 Level, Guaranteed Death Benefit
Guaranteed Cash Value
Level, Fixed Premiums to Age 100
100
121

13. Whole Life Purposes…
To provide permanent protection to a surviving spouse/beneficiary:
Funeral Expenses
Income Protection
Estate Planning
Add insurance without proof of insurability
Create control for life’s “what-ifs”
Great for Ages 0-50.

14. Why Whole Life… Provides a guaranteed, permanent death benefit
Guaranteed cash values and non-forfeiture options provide additional control compared to other options
OPAI provides future, guaranteed insurability of up to $1M+ dollars

15. TERM
Term Life Insurance

16. term Life history…
1965 – Serviceman’s Group Life Insurance (SGLI) formed This is also when the concept of “Buy Term and Invest the Difference” was formed.
1977 – A.L. Williams founds A.L. Williams and Associates under the BTID Concept (later became Primerica).

17. term Life Quick Facts… Insurance in its purest form
Increasing or Level Premiums
Guaranteed Death Benefit for “term” selected
No Cash Value
No guaranteed insurability options
Can be convertible to permanent life insurance
Whole Life
Universal Life

18. Term life… Level, Guaranteed Death Benefit
Annually Increasing Premiums
Term life…
Level Premiums to End of Term
Level, Guaranteed Death Benefit
Decreasing Gtd. Death Benefit
Level Premiums to Specified Age
20 Years
Age 65

19. Types of term… Annual Renewable Term (ART) Level Term (LT)
Lowest starting premium
Premium Increases on an annual basis
Coverage typically provided until a certain age though costs rise quickly
Level Term (LT)
Highest starting premium
Premium remains level for 10,15,20,25 or 30 Year Term
Coverage becomes ART at end of Term Period
Decreasing Term (DT)
Premium falls between ART & LT
Premium remains level until specified age
Coverage decreases each year on a linear basis

20. term Life Purposes…
To provide temporary protection to a surviving spouse/beneficiary:
Pay off Debts
Mortgage Protection
College Education
Child Care
Supplement Permanent Insurance to meet client’s budget
Can be applicable at any age

21. Why level term… Only option that provides the best of both worlds:
A Level DB for a specified period of time &
A Level Premium for that same specified time period
Can meet specified need for specified finite period
EX: $400k 30 Year Mortgage
Typically convertible until end of term period or Age 65
Whichever comes 1st
Convertible to all permanent policies offered at time of conversion
No proof of insurability necessary

22. universal Life InsuranceUL
universal Life Insurance

23. Universal Life history…
1979 – E.F. Hutton pioneers “Total Life”…also known as Universal Life.

24. Universal Life Quick Facts…
Flexible, Adjustable Premiums
In amount paid each year &
In pay period
Death Benefit may or may not be Guaranteed
Cash Values are interest rate driven
Combines term element & investment element

25. Guaranteed universal life…
Level Death Benefit
BUT Premiums are adjustable
Typically Level Premiums to Age 100…
Gtd. Cash Value 65
100
121

26. universal Life Purposes…
To provide permanent protection to a surviving spouse/beneficiary:
Funeral Expenses
Income Protection
Estate Planning
Stripped Down Permanent Insurance helps budget (think “Term to 121”).
Great for Ages 50+

27. Why GUL…
Gtd. Permanent Death Benefit as long as NLG Premium paid regardless of Cash Value performance.
Least expensive form of Universal Life
“Term to 121”

28. THANKS
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