What is variable universal life insurance?

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PostPosted: Mon Nov 28, 2011 9:56 pm   Post subject:   

fjamvai,



Did you even read the posts in this thread? We are not talking about fixed products. We are discussing indexed products. So your answer is wrong.

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PostPosted: Mon Nov 28, 2011 9:58 pm   Post subject:   

Quote:
Did you even read the posts in this thread? We are not talking about fixed products. We are discussing indexed products. So your answer is wrong.




Do you know where the money is placed for indexed products? Do you know where the majority of the money is invested by the insurance company?
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PostPosted: Mon Nov 28, 2011 11:50 pm   Post subject:   

Quote:
Did you even read the posts in this thread? We are not talking about fixed products. We are discussing indexed products. So your answer is wrong.




I would love to argue about things where we have a difference of opinion. However, it's idiotic to argue facts. Your facts are wrong.



Indexed products are fixed products. That is why one does not need to be registered to sell them. Like a traditional UL product, the money is in the general account of the insurance company. They need to hedge their risks differently, but that doesn't change anything.



The only difference between UL and IUL is how the insurance company chooses to credit interest. With UL, the board of directors makes the decision on how much interest to pay. With IUL, there is a pre-determined formula.

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PostPosted: Mon Nov 28, 2011 11:51 pm   Post subject:   

Before you started posting, we were talking about variable universal life. VUL is not an indexed product. The money is in separate accounts and, thus, is not a fixed product and one must be securities licensed to sell it.


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PostPosted: Tue Nov 29, 2011 12:51 am   Post subject:   

You said "It gets interest credited based upon the decision of the board of directors of the insurance company."



The contract does not get interest based upon the decision of the board of directors! So if the S&P gained 10% and the contract offers a 10% cap you are saying that the Board of Directors can say they will credit 3%! That is wrong. The contracts PARTICIPATE IN THE STOCK MARKETS GROWTH! GET OVER IT!



I am not arguing that the money is in the general fund. I know it is not invested in the stock market. They buy options so that the account can PARTICIPATE IN THE STOCK MARKET GROWTH.

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PostPosted: Tue Nov 29, 2011 1:21 am   Post subject:   

Quote:
I am not arguing that the money is in the general fund. I know it is not invested in the stock market. They buy options so that the account can PARTICIPATE IN THE STOCK MARKET GROWTH.




So when you ran this by your state's DOI, the carrier's compliance department, the SEC, what did they say about it?
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PostPosted: Tue Nov 29, 2011 1:41 am   Post subject:   

Quote:
You said "It gets interest credited based upon the decision of the board of directors of the insurance company."



The contract does not get interest based upon the decision of the board of directors! So if the S&P gained 10% and the contract offers a 10% cap you are saying that the Board of Directors can say they will credit 3%! That is wrong. The contracts PARTICIPATE IN THE STOCK MARKETS GROWTH! GET OVER IT!



I am not arguing that the money is in the general fund. I know it is not invested in the stock market. They buy options so that the account can PARTICIPATE IN THE STOCK MARKET GROWTH.




You may want to read the entire quote. That quote was about traditional universal life. The point is that with both UL and IUL the money is in the general account of the insurance company and the only difference is in how they credit the money. If one can say that IUL participates in the stock market growth, one can just as easily say that UL participates in the returns of the stocks and bond markets. Of course, we would never say that, yet, for some reason, people feel comfortable saying that about IUL.

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