The Potential Problems With No-Lapse Premium Guarantees
by Peter Katt
Like Pac-Man, a new policy-type is trying to gobble up as much existing permanent insurance as possible. And why not, who wouldnt want to buy (either as new or replacing existing policies) a permanent policy with excellent guaranteed premiums? So-called no-lapse-premium-guarantee (NLPG) policies have become a hot concept with many agents promising rock-solid, unconditional guaranteed premiums.
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No-lapse premium guarantees are impressing agents, insurance buyers and their advisors. And the financial media are cheering them on as ideal for consumers because of lost confidence in permanent insurance due to poorly performing universal life and vanishing-premium and variable-life promises that have not come true.
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