Cash value accumulation test or guideline premium test: a comparison
August 16, 2016 by Bruce Guillemette, Christian Kaplan
As life insurance products evolved, particularly in the early 1980s, with the advent of universal life (UL) insurance characterized by flexible premiums, other client considerations came to the forefront.
Should permanent life insurance products be designed to emphasize pure death benefit protection or pure accumulation? Death-benefit-focused products have more “levelized” costs, i.e., a shallower expense curve, with higher charges in early years and lower charges in later years, whereas the opposite is true for those focused on accumulation, which have a deeper curve with lower costs early in the policy duration and higher costs at the later stages. Click HERE to view the full story. LifeHealthPro articles may require free registration to read.
