The current Gross Interest Rate credited to a Universal Life Insurance Policy as of October 2017?
What is 3.85%?
100
This number represents the maximum premium allowed to be paid in a given year in the early years of a life insurance policy. Anything more will make the policy a Modified Endowment Contract.
What is the Initial Seven-Pay Premium?
100
A type of trust that is typically funded by a life insurance policy for the long-term benefit of a mentally or physically disabled dependent
What is a Special Needs Trust?
100
The primary question that helps clients reevaluate the types of accounts they have chosen to place their assets.
What is the purpose of this money?
100
From taking an application to the policy being issued, this is the time frame that will properly set client expectations
What is 60 to 90 days?
200
Pays 1% of the face amount to a non-profit at the death of the insured
What is the Charitable Benefit Rider?
200
The three tax benefits available through a non-MEC life insurance policy
What are 1) Tax-deferred growth 2) Income Tax-Free Death Benefit, and 3) Tax-free withdrawals and loans?
200
A sophisticated policy design that provides younger clients with income protection, while also allowing them to grow their savings for future tax-free income in retirement.
What is Supplemental Retirement Income Plan (SRIP) OR Life Insurance Retirement Plan (LIRP)?
200
Three major sources of lump sum premiums typically found in the Tax Now column of the Asset Location Worksheet
What are Cash, CDs, and Fixed Income Investments?
200
The two types of underwriting required to approve a policy
What are 1)Financial Underwriting and 2) Medical Underwriting?
300
The policy's interest rate is credited on a _________ basis, while the cost-of-insurance is deducted on a ________________ basis.
What are Daily and Monthly?
300
The IRS applies a 10% income tax penalty on earnings withdrawn from a MEC prior to this age.
What is 59 1/2?
300
The three general risks that may deteriorate or eliminate a client's legacy
What are
1) Market Risk (volatility / sequence of returns), 2) Financial Risk (emergencies / LTC / inflation), and 3) Tax Risk
300
Sources of excess cash flow that may be redeployed to a life insurance policy to protect a client's legacy
What are earned income, dividends, coupons, royalties, real estate income, social security income, and after-tax-annuity income?
300
The team at the Life Insurance Company that helps the ISD and the WMA with more complex cases that require additional support with policy design.
What is The Advanced Markets Team (a team of attorneys with a specialty in life insurance law)?
400
The two potential policy changes that are illustrated in the "Guaranteed" Columns of Table II in the illustration
What are 1) Interest rate is decreased to the guaranteed 3% floor, and 2) Cost of insurance is increased to the maximum allowable levels?
400
The tax benefit(s) lost when a life insurance policy becomes a MEC
What is Tax free withdrawals and loans?
400
This life insurance strategy helps ensure a fair and equitable distribution of an inheritance to multiple family members, especially when real estate or business assets are being passed on to one or two family members, but not to all.
What is Estate Equalization?
400
The most common after-tax account type held by clients in the "Tax Later" column of the Asset Location Worksheet that may be systematically repositioned to a life insurance policy in the "Tax Never" column to help protect a legacy.
What is an After-Tax-Annuity?
400
This individual at the Life Insurance Company is responsible for gathering all records and requirements for the underwriter. They communicate regularly with clients to obtain additional information throughout the underwriting process.
Who is The Case Manager?
500
The spread between a policy's cash value and the policy's death benefit
What is Corridor of Risk or Amount at Risk?
500
This occurs when a client inadvertently makes a premium payment that exceeds the seven-pay premium
What is The premium is not processed. The client receives a letter asking them to first acknowledge that they are aware that the policy will become a MEC. No client can accidentally create a MEC without their written or verbal consent?
500
"Your estate is optimized. If you were to pass away today, I assure you that your estate is liquid, tax-efficient, fair and balanced to your beneficiaries, and is perfectly protected to meet your wishes."
What is The message we silently send clients every time they leave a trusted WMA's office without discussing our life insurance capabilities?
500
The process of relocating assets or cash flow to a life insurance policy to specifically protect a clients desired ending capital goals. This includes providing the client with the a "stop loss" and a "downside hedge"
What is Legacy Risk Management?
500
It's the primary reason why the underwriting process gets delayed and is typically out of our control.