What are investment grade insurance contracts? What are their benefits?
Total Comments: 19
Posted: Mon Dec 07, 2009 08:44 pm Post Subject:
i gather they are life insurance contracts with an investment portion. I've heard these mentioned before but I'm not 100% on how they worl exactly.
Posted: Tue Dec 08, 2009 07:40 am Post Subject:
IGIC is a tax-deferred growth opportunity for your hard-earned money. Earning interest would show you through a good amount in the end, if you don't lose money towards paying taxes now. Even when you're required to pay the taxes in the end, you'd still find yourself at the front of your investment vehicle. But could you ever imagine an opportunity wherein you're not required to pay for the taxes even when you'd pull out your money in the end?
The IGIC is a contract that makes this dream come true!
Posted: Wed Dec 09, 2009 06:19 am Post Subject:
Yes, IGIC could be of great help to your family members in the future. If you don't choose to go for the usual govt. backed retirement options, then you may leave the account for your children without any income tax dues.
Posted: Thu Dec 10, 2009 06:23 am Post Subject:
Another great advantage with IGIC is that it doesn't bring stock market risks. In comparison, the retirement plans with the govt. may suffer considerable losses at the stock market. The returns would also remain quite competitive with IGIC.
Posted: Fri Dec 11, 2009 06:49 am Post Subject:
I find IGIC quite flexible in nature as it offers an easy access to money. With the IRA's your money is not accessible till you get 591/2. Again if you'd take a loan, you'd need to repay it within a specified time and upon meeting the agreed interest. Penalties would apply in case you fail!
Posted: Fri Dec 11, 2009 05:10 pm Post Subject:
If Congress begins to see evidence of IGICs being used or marketed in a way that is intended to subvert taxation, as they did with UL in the 1980s (when people would put their cash into the policies, and immediately borrow out as much as they could, taking a tax deduction for the "accumulated" interest they were not actually paying), you'll see IGICs swept unceremoniously into the definition of MECs, negating all the current hype.
You don't get something for nothing, especially when an insurance company is involved. And when it comes to IGICs, buyer beware. They are not a bed of roses devoid of thorns.
Like UL/VUL, take out more than the cost basis (because someone once told you it was "tax-free") and subsequently allow the policy to lapse? Now tell us you haven't created a taxable event.
Can't claim, "But the agent said . . . ." because, conveniently, he won't "remember" ever having said it ("Senator, I have no recollection . . . ."). And if he does, then he's a fool, too.
Better to put it more succinctly. "Mr. Jones, this is life insurance. It has features unlike some policies you may have seen in the past. But with this policy, you have the potential to achieve returns similar to that of directly investing in the stock market, yet, unlike your stock broker, the insurance company is promising to limit (or protect) your risk on the downside potential. It's pretty close to a win-win situation. Now let me show you how it works . . . ."
Have to avoid the use of "tax free" by using the more correct "tax deferred" when describing growth of cash value, and cannot discuss "tax free withdrawals or loans" unless you include the necessary disclosure information about "exceeding the cost basis."
Stay within the boundaries of ethical relationships, communication, and responsibilities, and you'll be OK. Just might not sell as much of it. It's not the product that's wrong, it the marketing of the product that creates wrong perceptions in the mind of a client who hears what he wants to hear.
Posted: Mon Dec 14, 2009 09:00 am Post Subject:
IGIC's hard on some people - if you're not in good health you may not qualify for this one. Another problem that you'd face is that you can't write off the premium dollars as in IRA and 401(k).
Posted: Tue Dec 15, 2009 07:37 am Post Subject:
These plans are aimed to serve you with multiple benefits in the long term through different stages of your life. In order to achieve a maximum benefit with the IGIC, you must invest for a long term. This program is not designed to offer you short terms gains.
Posted: Wed Dec 16, 2009 06:14 am Post Subject:
Be careful while setting up these plans. The violation of the present tax-code might see you in trouble. You'd need help from someone who can structure such plans perfectly.
Posted: Thu Dec 17, 2009 01:15 am Post Subject:
Oh man, so we've decided to stop calling it a 7702 plan and start calling it IGIC? I really hope they rewrite the laws and make all you indexed ul pushers get a securities license to sell it.
There is no such thing as "investment grade" life insurance.
This is the equivilent of calling Whole Life Insurance a pension plan with a free health check up. Just stop.
Posted: Mon Dec 07, 2009 08:44 pm Post Subject:
i gather they are life insurance contracts with an investment portion. I've heard these mentioned before but I'm not 100% on how they worl exactly.
Posted: Tue Dec 08, 2009 07:40 am Post Subject:
IGIC is a tax-deferred growth opportunity for your hard-earned money. Earning interest would show you through a good amount in the end, if you don't lose money towards paying taxes now. Even when you're required to pay the taxes in the end, you'd still find yourself at the front of your investment vehicle. But could you ever imagine an opportunity wherein you're not required to pay for the taxes even when you'd pull out your money in the end?
The IGIC is a contract that makes this dream come true!
Posted: Wed Dec 09, 2009 06:19 am Post Subject:
Yes, IGIC could be of great help to your family members in the future. If you don't choose to go for the usual govt. backed retirement options, then you may leave the account for your children without any income tax dues.
Posted: Thu Dec 10, 2009 06:23 am Post Subject:
Another great advantage with IGIC is that it doesn't bring stock market risks. In comparison, the retirement plans with the govt. may suffer considerable losses at the stock market. The returns would also remain quite competitive with IGIC.
Posted: Fri Dec 11, 2009 06:49 am Post Subject:
I find IGIC quite flexible in nature as it offers an easy access to money. With the IRA's your money is not accessible till you get 591/2. Again if you'd take a loan, you'd need to repay it within a specified time and upon meeting the agreed interest. Penalties would apply in case you fail!
Posted: Fri Dec 11, 2009 05:10 pm Post Subject:
If Congress begins to see evidence of IGICs being used or marketed in a way that is intended to subvert taxation, as they did with UL in the 1980s (when people would put their cash into the policies, and immediately borrow out as much as they could, taking a tax deduction for the "accumulated" interest they were not actually paying), you'll see IGICs swept unceremoniously into the definition of MECs, negating all the current hype.
You don't get something for nothing, especially when an insurance company is involved. And when it comes to IGICs, buyer beware. They are not a bed of roses devoid of thorns.
Like UL/VUL, take out more than the cost basis (because someone once told you it was "tax-free") and subsequently allow the policy to lapse? Now tell us you haven't created a taxable event.
Can't claim, "But the agent said . . . ." because, conveniently, he won't "remember" ever having said it ("Senator, I have no recollection . . . ."). And if he does, then he's a fool, too.
Better to put it more succinctly. "Mr. Jones, this is life insurance. It has features unlike some policies you may have seen in the past. But with this policy, you have the potential to achieve returns similar to that of directly investing in the stock market, yet, unlike your stock broker, the insurance company is promising to limit (or protect) your risk on the downside potential. It's pretty close to a win-win situation. Now let me show you how it works . . . ."
Have to avoid the use of "tax free" by using the more correct "tax deferred" when describing growth of cash value, and cannot discuss "tax free withdrawals or loans" unless you include the necessary disclosure information about "exceeding the cost basis."
Stay within the boundaries of ethical relationships, communication, and responsibilities, and you'll be OK. Just might not sell as much of it. It's not the product that's wrong, it the marketing of the product that creates wrong perceptions in the mind of a client who hears what he wants to hear.
Posted: Mon Dec 14, 2009 09:00 am Post Subject:
IGIC's hard on some people - if you're not in good health you may not qualify for this one. Another problem that you'd face is that you can't write off the premium dollars as in IRA and 401(k).
Posted: Tue Dec 15, 2009 07:37 am Post Subject:
These plans are aimed to serve you with multiple benefits in the long term through different stages of your life. In order to achieve a maximum benefit with the IGIC, you must invest for a long term. This program is not designed to offer you short terms gains.
Posted: Wed Dec 16, 2009 06:14 am Post Subject:
Be careful while setting up these plans. The violation of the present tax-code might see you in trouble. You'd need help from someone who can structure such plans perfectly.
Posted: Thu Dec 17, 2009 01:15 am Post Subject:
Oh man, so we've decided to stop calling it a 7702 plan and start calling it IGIC? I really hope they rewrite the laws and make all you indexed ul pushers get a securities license to sell it.
There is no such thing as "investment grade" life insurance.
This is the equivilent of calling Whole Life Insurance a pension plan with a free health check up. Just stop.
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