Planning Trends Relating to the Demise of DOMA

Planning Trends Relating to the Demise of DOMA

As states began to legalize same-sex marriage in the early part of the twenty-first century, an inevitable conflict arose with the federal Defense of Marriage Act (DOMA), which broadly prohibited the federal government from recognizing the legality of same-sex marriage even when such marriages were permissible under state law. The legal requirements of marriage has […]

Planning Trends Relating to the Rise of ATRA

Planning Trends Relating to the Rise of ATRA

For over twenty years, from 1987 through 2003, the federal estate and gift exemption remained relatively unchanged (gradually increasing from $600,000 to $1,000,000) in their planning trends, and the federal estate tax rate was at least 50 percent. Thus, during this time period the federal estate tax was likely one of the top estate planning […]

What Current Assumption Whole Life (CAWL) Insurance Proposals and Ledgers Do Not Reveal

What Current Assumption Whole Life (CAWL) Insurance Proposals and Ledgers do Not Reveal

It is important to know what Current Assumption Whole Life (CAWL) Insurance proposals and ledgers do not reveal. Insurance companies or their agents should tell purchasers of life insurance, either verbally or in writing, the following additional information: The investment strategy employed by the life insurance company, (e.g., pure portfolio rate, modified portfolio rate, weighted […]

Facts to Know about the Net Investment Yield with Current Assumption Whole Life (CAWL) Insurance

Facts to Know about the Net Investment Yield with Current Assumption Whole Life (CAWL) Insurance

Over the long run, insurance companies cannot credit more interest to policy cash values than they earn on their general investment portfolios. To assess a company’s long run interest crediting ability, one should evaluate the insurer’s current portfolio and its investment philosophy. As a general rule, insurance companies invest their portfolios predominantly in long-term corporate […]

Mortality Charges within Current Assumption Whole Life (CAWL) Insurance

Mortality Charges within Current Assumption Whole Life (CAWL) Insurance

A CAWL contract explicitly states the maximum mortality rates it will charge for all ages and guarantees that mortality rates will not exceed those maximums. Many companies now use the 2001 Commissioner’s Standard Mortality (CSO) table as the basis for their contractually guaranteed maximum rates on newly issued policies, but some companies still use the […]

Expense Charges within Current Assumption Whole Life (CAWL) Insurance

Expense Charges within Current Assumption Whole Life (CAWL) Insurance

Principally two elements comprise the expense charge: (1) a fixed annual fee, plus (2) a percentage of premiums paid. The company may or may not reveal these fees in its original policy illustration. However, even if it does, the company usually does not guarantee that the expense charges will not change. Actual expense charges may […]

How to Read and Understand a Current Assumption Whole Life (CAWL) Insurance Proposal Ledger

How to Read and Understand a Current Assumption Whole Life (CAWL) Insurance Proposal Ledger

It is important to understand your Current Assumption Whole Life (CAWL) Insurance Proposal Ledger. The principal source of information regarding a new policy is the policy illustration or ledger. The table above shows an annotated policy illustration with the following commentary. Base mandatory premium combined with a rider (similar to a paid-up additions rider for […]