Need Help - My First Second to Die Case for an Estate

[VolAgent]

No, he specifically told me that the guardian agent is selling them the policy and using the cash value as a selling point and told them to overfund the policy because it would build up the cash value that they could then borrow against at a later date. That part was made very clear to me (the reasoning for the overfunding)

Very strange.

I guess that is why the ILIT won't be the owner, but then it will still count as an asset for the estate tax. He could put the policy in the ILIT and you would still be able to borrow out. The trustee would do it to benefit the beneficiary of the trust.

I really don't get this strategy on the part of the Guardian agent. Is he new and not working with someone in his office?

 

[NCSU INS GUY]

I don't know anything about the guardian guy. I do know that the family also has an SBA loan that requires them to carry $500,000 in insurance on both parents for 10 years. They don't want the life insurance and are only taking it out to satisfy the terms of the loan

I'm pushing pure 10 year level term (cheapest way to satisfy the condition of the loan) and the other agent is pushing a term/whole life blend that will cost them 4 times as much per month, but he is telling them that it will be cheaper in the long run because they aren't "wasting their money on term if they don't die". He told them the cash value would be worth more than the additional cost of the policy. It would cost more on a monthly basis but at the end of the 10 years, they would have saved money.

 

[Larry Tew]

No, he specifically told me that the guardian agent ...

Do you know the Guardian agent's name? (first name only).

 

[mcouper]

May have missed it - but if they're 65+ I think the ship has sailed on cash value growth. As mentioned if ILIT is owner/bene (as it should be) use of cash value will be limited, mostly to a review later on. Maybe other agent 1) likes high product payout or 2) has no GSUL to compete with - amazing how the answer is often the only product available to him/her. Show them the cheapest GSUL you can find and include an IRR page.

 

[LGilmore]

Right now, from everything you've said, you don't know s hit from shineola. There are so many things going on here that simply don't mesh cause you're getting bad intel from the son.

If you want their business, GO SEE THEM. Ask what they're considering doing and if it is even close to what you're talking about then set them straight on the tax aspects of what they are doing.

There is a new/old thing about insurance trusts being formed at death, I've got a client doing this, but with individual policies, not a 2nd to die. Everything they're saying they want to do makes no sense for an Irrevokable (sp?) insurance trust.

Get 1st hand information.

 

[NCSU INS GUY]

Do you know the Guardian agent's name? (first name only).

Don't really want to put it out there. It starts with a D. You can pm me if you want to talk off the forum.