Whole Life Policy Purchase Checklist

Whole life insurance is a complicated, expensive, and extremely opaque product. The performance of whole life insurance almost always depends on the dividends, though dividends are far more volatile than most understand.

The primary mistakes most policyholders make revolve around crediting rates and understanding how participating dividends work. If you are looking at buying a policy that uses participating dividends, then you need to be confident that those dividends will perform for you; otherwise, you will not get a reasonable return on your investment and will be paying too much for that coverage.

Before purchasing one of these policies, it is important to get a written explanation regarding the carrier’s dividend-crediting strategy. With this, you can better understand the effects of the changing interest rate environment and crediting rate on the performance of your policy.

This is the most common form of permanent insurance sold in the marketplace, but the majority of people selling these products will not be able to answer all of the questions on the checklist. That doesn’t mean that you shouldn’t be receptive to this type of policy if you believe it meets your needs, and it certainly doesn’t mean that an advisor is misleading you or being dishonest if he or she can’t initially answer these questions. Eventually, your advisor will need to supply you with this information and also be able to answer these questions in their proper context.

The answers to the questions on this checklist will help you determine whether an indexed universal life policy will perform as projected and whether it will meet your needs. 


Whole Life Policy Purchase Checklist

Use this form to log information regarding your prospective Whole Life Insurance Policy. After completing the forms, click the button below to complete your questionnaire. Your notes will automatically forward to the email address you've provided.
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