With the Life Industry and Annuity Industry facing pressures due to the interest rate environment and regulation, it’s important to think “outside the box” when delivering solutions to your clients. This one IUL solve is doing just that, and beats fixed indexed annuities.
Here is what this solve offers:
A Death Benefit 3-4x your original deposit day 1.
Strong Accumulation due to higher cap rates.
Living Benefits that cover Chronic and or Critical Illness.
A death benefit that Guarantees to 121.
Potentially No Medical Exam.
What is a Modified Endowment Contract (MEC)?
a MEC is life insurance policy funded beyond the 7-pay or Guideline Premium limits.
a MEC assumes annuity rules from a taxation standpoint. (you will withdraw gains before basis and pay tax on the gain)
a MEC has a generally tax-free death benefit just like a non-MEC policy, which includes the use of accelerated death benefits for Chronic or Critical Illness.
a Life Insurance Policy, MEC or non-MEC, can be exchanged into an annuity if the future desire turns towards lifetime income or other annuity opportunities.
Is a MEC a Bad Thing?
No. A Modified Endowment Contract is not a bad thing when it is intentional. In this solve specifically we are comparing an Intentional MEC to an Fixed Indexed Annuity. This intentional focus does not change the tax nature between the two products as it relates to accumulation, but it does improve the tax nature of the death benefit and other related benefits beyond the accumulation.
With NFG Brokerage, you no longer need to depend on a one size fits all approach. We work hard for you to create customized insurance strategies to help you deliver the most affective solutions to your clients. Your success is our success...don't delay!
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