Case Study
Jane & Mary,
both individuals needs Life Insurance
worth $500,000 each.
Term Life
Vs
High
Efficiency Universal Life
Term Life
100
Jane enrolls for Term 100
insurance
to cover her life full with the policy's face value of $500,000
High
Efficiency
Universal Life
(HEUL)
Marry
decides to invest in
HEUL which automatically
covers
her full life insurance
worth $500,000
What is Term 100 ...
What is HEUL ...
Jane pays a monthly premium to protect her life using Term 100.
Marry invests in HEUL to grow her money at a high rate and gets her life insurance.
Instead of paying ...
Jane's premium is fixed at $2,110 yearly, which is 10X higher as compared to UL
Marry's “cost-of-insurance” starts with $190 and gradually increases based on her age.
The insurance cost ...
Jane continues to pay a yearly premium for the rest of her life.
Marry stops contributing after 20 years. After that, she sits back and just relaxes.
How many years...
If Jane fails to pay her insurance premium, her policy lapse with no return. In order to have consistent life coverage, the yearly premium must be paid.
This year Marry is struggling with her savings, so she decides to skip contributing to HEUL. No negative impact on her life insurance and her investment account keeps growing.
How flexible...
Jane's payment is an ‘expense’ so no question on investments or returns.
Marry has a number of high grwoth mutual funds to choose from, where her money should be invested.
Your choices...
At 65, Jane is figuring out her means of post-retirement income and pays taxes on earnings from traditional sources.
At the age of 65, Marry takes her retirement. HEUL feeds her income about $66,000 yearly tax-free for the next 10 years
Worreid about pension...
On Jane's death, regardless of the age, her family receives $500,00 from insurance. No Probate required.
Marry forgot to make her “Last Will” and dies at 85. Her family gets $1.2 million from HEUL with no requirement to Probate in court.
Inheritance & probate...
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