I have NEVER seen an illustration that came to fruition in my 25 years in this business. Ever.

March 19, 2025 by Sheryl J. Moore

 I was just reading Drew Gurley’s article in InsuranceNewsNet, “When an IUL might be a sensible alternative to an FIA” It was comparing indexed life to indexed annuities for retirement income.

Now, I LOVE indexed life. Do not get me wrong. It is a great product line. There is something I cannot get past, however…

I have NEVER seen an illustration that came to fruition in my 25 years in this business.

Ever.

And so- I often cringe when I hear about agents pitching a Life Insurance Retirement Plan (LIRP), using indexed life.

Indexed life has surrender charges, premium loads, policy fees, per 1,000 charges, percent of fund charges, cost of insurance charges and more. Indexed life is life insurance, and this insurance has a “cost.”

Illustrated projections can go awry when the insurance charges increase, when the loan rate deviates, and when the caps/par rates are reduced.

Can you imagine a policyholder with a LIRP that doesn’t come to fruition, when they retire as age 65? What if they are not able to get the paycheck that was illustrated to them? What if the money runs out before they die?

Can you imagine if this happened to you? How about your parents? Your grandparents?

My first job in this business was providing telephone customer service to consumers that had bought underfunded universal life and vanishing premium whole life. The stories I would hear broke my heart.

I cannot fathom how these insurance purchasers are going to react to illustrated values vs. actual performance. It weighs heavily on me.

Not a popular position on these products…I respect the people that are doing right by their clients, but this seems bigger than what happened to cash value life insurance in the 1980’s. -sjm