Indexed Universal Life IUL April Deng 1 10

Indexed Universal Life (IUL) April Deng 1 -10 -2015

The Evolution of Phone

The Evolution of Life Insurance

Types of Life Insurances • Term Life Insurances Pros: 1) Affordable and therefore can get large face amount. 2) Some employers may provide it. Cons: 1) You have to die to get death benefit; 2) Not portable if provided by employer; 3) May be denied at renewal if though employer • Permanent Life Insurances Whole Life u Variable Life u Universal Life u Indexed Universal Life u Variable Universal Life u

Savings program mirroring Index: § Guaranteed growth 0 -15% § Tax advantages § Access cash value at any time § Lawsuit/creditor proof

6 Not for The Public, Internal Training Only For Internal Training Purpose Only

IUL: Index Universal Life Indexed UL credits interest based on performance (or weighted) of a linked Index or Indexes, multiplied by a participation rate, subject to a cap and a floor rates. Index NW IUL 8% 8% 20% 12% (Cap) -20% 0% (Floor)

Concept of IUL Never Lose Money – Warren Buffett IUL Market

What Can IUL Do For You?

Case Study 1 Mr. Young ◦ 30 -year-old ◦ Father to a new born baby ◦ $300 K mortgage ◦ Family AGI $140 K ◦ 10% contribution to 401 K What can IUL do for him?

30 Year Old, 700 K IUL At age 85, Total return = $168, 806 + $744, 053 + $555, 162 = $1, 468, 000

Case Study 2 Mr. Mature ◦ 50 -year-old ◦ Family AGI $200 K ◦ Kids have grown up ◦ $220 K Rental property What can IUL do for him?

50 Year Old, 800 K IUL How likely will his 220 K house become a 2 million house in 35 yrs? Maintenance free ? Tax free?

College Education Funding

Asset Protection STATE LIFE INSURANCE CASH VALUE LIFE INSURANCE PROCEEDS Texas 100% Texas Ins. Code§ 1108. 051 Same as life insurance cash value Maryland 100% if made for the benefit of spouse, child or dependent. Md. Code Ann. Ins. § 16 -111 Same as life insurance cash value Lousiana Beneficiary’s interest in proceeds and avails 100% protected. Limited to $35, 000 if issued within 9 months. La. Rev. Stat. Ann. § 22. 912 100% La. Rev. Stat. Ann. § 22. 912 New York 100% N. Y. Ins. Law § 3212(b). In re Mesinger, 29 F. 2 d 158 (2 nd Cir. 1928) 100% N. Y. Ins. Law § 3212(b) Pennsylvania Income or return of $100/mo 42 Pa. C. S. § 8124(c)(3) 100% if payable to spouse, child or dependent. 42 Pa. C. S. § 8124(c)(6)

Frequently Asked Questions about IUL

IUL too expensive? Case I. 40 Years old Male, Preferred plus rate class, $500 K face amount From Age 40 -80, total 40 years, IUL Case II. 40 Years old Male, Preferred plus rate class, $500 K face amount From Age 40 -80, total 40 years, Term 20 years + another term 20 years Buy a BMW vs a Ford. A Mansion vs renting an apartment

IUL too expensive? Case I 40 Years old Male, Preferred plus rate class, 500 K face amount From Age 40 -80, total 40 years, IUL Cost total: $5, 252 + $4, 800 + $14, 625 + $26, 602 = $41, 279 Annual average cost : $1, 032 Case II 40 Years old Male, Preferred plus rate class, 500 K face amount From Age 40 -80, total 40 years, Term 20 years + 20 years Cost total: $8, 160 + $51, 160 = $59, 320 Annual average cost : $1, 483, Actually $2, 100

It’s Too Good To Be True? Shift to Wealthier Clientele Puts Life Insurers in a Bind The Wall Street Journal - October 3, 2010

Any Drawback in IUL? Depending on health condition Not for short term investment Designed to be adequately funded, not underfunded. Early cancellation strongly discouraged. Need discipline!

Just like the BMW M-6, IUL is a great vehicle, If only you know how to drive it!

REAL SHORT-COMINGS OF IUL Too complicated ◦ Like all modern cars, the BMW M 6 is very complicated ◦ BMW sends the buyer of their M 6 to special driving school before they hit the road ◦ M 6 needs true professionals who can maintain the vehicle in a proper way Designed to be sufficiently funded ◦ You buy a super car like the M 6, you expect it to consume some gasoline, so fill up the tank before expecting it to outrun a Mazda You lose money if the policy is cancelled early on ◦ You buy a brand new M 6, and sell it next year, you’ll not get all your money back. Aren’t those common sense?

Conclusion A well maintained IUL can do tremendous things for family! Thank You!