      |
 |
Hickory, NC January 2010 Affluent clients are generally the most savvy when it comes to avoiding unnecessary expenditures. When evaluating their life insurance needs, term insurance has been the most cost effective means of providing the most life insurance coverage for the money. However, term insurance for older Americans can cause an unexpected financial catastrophe when the term insurance renews after the initial term period. Most term policies are only convertible to permanent coverage up to age 70 or 75. If an affluent American purchases term insurance at age 58 or older, it is likely that they will outlive the policy’s maximum conversion age. This means that the client will be forced to drop the coverage when they need it the most. Permanent plans are more expensive than term because the premiums are generally level for the lifetime of the insured. AlTERMative 15 is a new platform that allows affluent clients to purchase permanent coverage for term-like pricing. The client outlay is very close to term insurance pricing for the first 15 years. At the end of the first 15 years, the premium increases to a level premium that is virtually the same as if a level premium policy was purchased at the attained age. AlTERMative 15 is a new plan design that is essentially a partial premium finance solution featuring one loan that is amortized over 15 years plus a supplemental premium in years 2 thru 15. The design allows the client outlay to be very close to the price of 15 year term. The design is not nearly as interest rate sensitive as normal premium finance plan designs since the loan is a principle and interest loan fully paid over 15 years. Policy cash values are generally high enough to exit the strategy as early as year 7 in the event the client no longer needs the coverage. “We feel that early adopters will seek out this solution for their life insurance needs”, says Bryan Setzler, the creator of AlTERMative 15. Affluent baby boomers who need policies of $ 2 Million and above want to pay as little as possible for life insurance, but also recognize that it is important to maintain the option of keeping the coverage past the initial term period. AlTERMative 15 provides the ideal solution”, says Setzler.
|