Q: Are the cash values in a no-load/low-load product that much higher than those in a commission policy?

Yes. There is a substantial difference starting in the first year if you compare "surrender" values and not "account" values, as the surrender value represents real money. In some cases, a commission policy will show no cash surrender value in the first year, whereas the no-load policy may show a cash value of 70% to over 90% of the premium payment. Keep in mind that there are no surrender charges in a true no-load policy.

Q: What do you mean by true no-load/low-load policy?

There are a number of companies that refer to a product as a no-load policy/low-load but the term is misleading. For example, some companied have lowered the asset management fee of the sub-accounts, which is commendable, but doesn't qualify as a no-load/low-load policy as we all know the term to mean. Other company's have lowered commission on a product, but still maintain all the other high loads. These do not qualify as a no-load/low-load policy either.

Q: Why are high first year surrender values so important?

There are several reasons:
  1. It generally is the surrender values that will perpetuate a policy if premiums are skipped (which is supposed to be one of the benefits of a flexible premium, cash-value dependent policy style). If the surrender value is -0- , or less than that which is needed to cover the cost of continuance, the policy will lapse.
  2. UL and VUL were initially designed to provide a combination of death benefit (based on current costs) and a liquid asset in a tax-wrapped product. Since no one, advisor or client, can state with absolute certainty that nothing will change after the first policy anniversary, we feel it is important for the client to have maximum control and liquidity should anything change in the near-term future. Control and flexibility are always directly related to the degree of liquidity in the policy. A policy that has a lien (surrender charge) against the asset restricts liquidity and therefore restricts control and flexibility.

Q: This may be true, but life insurance is a long term planning vehicle, not a short term investment.

That is what we all hope for, but reality indicates something else. First, statistics point to the fact that a very high percentage of policies lapse/terminate before ten years (almost 50% after 5 years). These lapses are due to a number of various reasons, but the fact is that such lapses take place during the surrender charge period of the policy, costing the client money. Second, there is the use of variable life and survivorship policies as a wealth accumulation tool due to the tax-sheltered wrap they provide. As a tax advantaged investment tool, access to cash values in short to intermediate time frames constitute the need for higher liquidity up front, even if the planning objective may be longer term.

Q: What does premium flexibility mean?

Commission policies have a target premium, which is often the minimum required premium to place the policy in force. This target premium represents the fully loaded amount that pays the maximum commission. As the no-load/low-load product does not pay the planner/advisor any sales commission, the range of premium is expanded to the downside. For example, a $1 Million survivorship policy on a male, aged 65 and a female, aged 62 can be purchased for under $800 in the first year. Compare that to a minimum premium of a commission policy (which would be in the thousands of dollars).

Q: Are you against advisors receiving commissions, or using commission policies?

No. Although we believe and can substantiate our feelings that the no-load/low-load UL and VUL policy is superior, we also believe that it is up to the consumer to make that choice. As long as there is full disclosure without omission to the client, let them choose. They may feel more comfortable with the traditional arrangement of commissions. However, our experience is that in 92% of the presentations made, the consumer has selected the fee-based no-load/low-load policy. In addition, there are some policy styles which are not yet available in a no-load/low-load version, but may fit the needs of the client. The real point is this: The advisor is not a true fiduciary unless he/she provides the client with a full choice of policy style options, regardless of the compensation model.

Terms of Use Policy

Q: Permitted Use

You have a nonexclusive, nontransferable, limited, revocable right to use the Website solely for your personal education and informational use. You will not use the Website for any other purpose, including any commercial purpose, without the Company’s express prior written consent. For example, you will not and will not authorize any other person to (a) Co-brand the Website or portion thereof, or (b) Frame the Website or portion thereof (whereby the Website or portion thereof will appear on the same screen with a portion of another website). “Co-branding” means to display a name, logo, trademark, or other means of attribution or identification of any party in such a manner reasonably likely to give a user the impression that such other party has the right to display, publish, or distribute the Website or content accessible within the Website. You agree to cooperate with the Company in causing any unauthorized Co-branding, framing or linking to immediately cease. You may use the website for lawful purposes only. You may not post or transmit through the Website any material which violates or infringes in any way upon the rights of others, which is unlawful, threatening, abusive, defamatory, libelous, invasive of privacy or publicity rights, vulgar, obscene, profane or otherwise objectionable, which encourages conduct that would constitute a criminal offense, gives rise to civil liability or otherwise violates the law. The Company will fully cooperate with any law enforcement authorities or court order requesting or directing the Company to disclose the identity of anyone posting such information or materials.

Q: Trademarks

The trademarks, logos, and service marks displayed on the Website are registered and unregistered Trademarks of the Company and its licensors, content providers, and business partners. Nothing contained on the Website should be construed as granting by implication, or otherwise, any license or right to use any Trademark displayed on the Website without the written permission of the Company or such party that may own the Trademark. Your use of the Trademarks displayed on the Website, or any other content on the Website, except as provided in these Terms and Conditions, is strictly prohibited. The Company will aggressively enforce its intellectual property rights to the fullest extent of the law, including seeking criminal prosecution.

Q: Proprietary Information

The content accessible within the Website, including without limitation, all articles, Trademarks, graphics, charts, screen captures, clipart, text, links, product specifications, product information, and other information (collectively, the “Content”) is the proprietary information of the Company and its content providers, and the Company and its content providers retain all right, title, and interest in the Content. You will not remove, alter, or cause to be removed or altered, any copyright, trademark, trade name, service mark, or any other proprietary notice or legend appearing on any of the Content.

Q: Indemnity

You will indemnify and hold the Company, its licensors, content providers, service providers and contractors, and their employees, agents, officers and directors (collectively the “Indemnified Parties”) harmless from your breach of these Terms and Conditions. You agree that the Indemnified Parties will have no liability in connection with any such breach or unauthorized use, and agree to indemnify any and all resulting loss, damages, judgments, awards costs, expenses, and attorneys’ fees of the Indemnified Parties in connection therewith. You will also indemnify and hold the Indemnified Parties harmless from and against any claims brought by third parties arising out of your use of the information accessed from the Website.

Q: Disclaimers

The Content and information on the Website is provided on an “as is” basis without warranties of any kind, either express or implied. To the fullest extent permitted by law, the Company:
  • Does not warrant that the Website or its Content will be error free;
  • Does not make any warranty as to the results that may be obtained from use of the Website or Content;
  • Excludes all representations and warranties relating to the content which may be provided by any affiliates or any other third party;

    The above exclusions and limitations apply only to the extent permitted by the law. None of you statutory rights as a consumer are affected.
The Company does not guarantee or warrant the files available for downloading from the internet will be free of infection or viruses, worms, Trojan horses, or other code that manifest contaminating or destructive properties. You are responsible for implementing sufficient procedures and checkpoints to satisfy your particular requirements for accuracy of data input and output, and for maintaining a means external to the Website for the reconstruction of any lost data. The Company does not assume any responsibility or risk for your use of the internet.

Q: Limitation of Liability

The Company, its licensors, service providers, content providers, and their employees, agents, officers and directors (collectively the “Company and its Affiliates”) will not be liable for any direct, indirect, incidental, consequential, or special damages, including loss of revenue or income, pain and suffering, emotional distress or similar damages arising out of or in any way connected with your use of or access to the Website, Contents, inability to use the Website, or otherwise arising in connection with this Website, even if the Company has been advised of the possibility of such damages. In no event will the collective liability of the Company and its Affiliates (regardless of the form of action, whether in contract, tort or otherwise) exceed $100.

Q: Links

The Website may contain hyperlinks to websites operated by third parties other than the Company. Such hyperlinks are provided for your reference only. The Company does not control such third party websites and is not responsible for their content or the products and services offered on the third party websites. The Company’s inclusion of the hyperlinks to such websites does not imply any association with their operation or the material on such website. Operators of the other websites may not maintain links to this Website without the Company’s prior written consent. The Company reserves the right to prohibit other websites from linking to this Website.

Q: Notification of Changes

The Company has the right at any time to change or discontinue any aspect or feature of the Website. These Terms and Conditions are subject to change by the Company at any time in its discretion, and changes will be made to this page. Your use of the Website after such changes are implemented constitutes your acceptance of the changes. Please consult these Terms and Conditions regularly.

Q: Miscellaneous

These Terms and Conditions shall be governed by and construed in accordance with the laws of Michigan applicable to contracts made and to be enforced wholly within such state. The waiver by either party of any provision of these Terms and Conditions on any occasion and upon any particular circumstances shall not operate as a waiver of such provision of these Terms and Conditions on any other occasion or upon any other circumstances. These Terms and Conditions may be waived and amended only in writing signed by both you and the Company.

Privacy Policy

Q: What information do we collect?

We collect information from you when you register on our site, subscribe to our newsletter or fill out a form. When ordering or registering on our site, as appropriate, you may be asked to enter your: name, e-mail address, mailing address or phone number.

Q: What do we use your information for?

Any information we collect from you may be used in one of the following ways:
  • To improve our website
    (we continually strive to improve our website offerings based on the information and feedback we receive from you)
  • To improve customer service
    (your information helps us to more effectively respond to your customer service requests and support needs)
  • To process transactions
    Your information, whether public or private, will not be sold, exchanged, transferred, or given to any other company for any reason whatsoever, without your consent, other than for the express purpose of delivering the purchased product or service requested.
  • To send periodic e-mails
    The e-mail address you provide for order processing, will only be used to send you information and updates pertaining to your order. If you decide to opt-in to our mailing list, you will receive e-mails that may include company news, updates, related product or service information, etc.

    Note: If at any time you would like to unsubscribe from receiving future e-mails, we include detailed unsubscribe instructions at the bottom of each e-mail.

Q: Do we use cookies?

We do not use cookies.

Q: Do we disclose any information to outside parties?

We do not sell, trade, or otherwise transfer to outside parties your personally identifiable information. This does not include trusted third parties who assist us in operating our website, conducting our business, our servicing you, so long as those parties agree to keep this information confidential. We may also release your information when we believe release is appropriate to comply with the law, enforce our site policies, or protect ours or others rights, property, or safety.

Q: Third Party Links

Occasionally, at our discretion, we may include or offer third party products or services on our website. These third party sites have separate and independent privacy policies. We therefore have no responsibility or liability for the content and activities of these linked sites. Nonetheless, we seek to protect the integrity of our site and welcome any feedback about these sites.

Q: California Online Privacy Protection Act Compliance

Because we value your privacy we have taken the necessary precautions to be in compliance with the California Online Privacy Protection Act. We therefore will not distribute your information to outside parties without your consent.

Q: Childrens Online Privacy Protection Act Compliance

We are in compliance with the requirements of COPPA (Childrens Online Privacy Protection Act), we do not collect any information from anyone under 13 years of age. Our website, products and services are all directed to people who are at least 13 years old or older.

Q: Online Privacy Policy Only

This online privacy policy applies only to information collected through our website and not to information collected offline.

Q: Your Consent

By using our site, you consent to our privacy policy.

Q: Changes to Our Privacy Policy

If we decide to change our privacy policy, we will post those changes on this page.

Q: Contacting Us

If there are any questions regarding this privacy policy you may contact us using the information below. Website: www.feeadvisorsnetwork.com Phone: (888)854-0931