Life Insurance

Life Insurance takes care of your loved ones while protecting personal & business assets.

Foss Financial can help you determine your Life Insurance planning needs.
We can assist reviewing an existing Life Insurance Policy and complete the following…

See all of Foss Financial's Insurance Options

Term life insurance covers a person for stated period of time or while being Employed.

  • Premium is based on age and health.
  • Term Life Insurance starts to become financially inefficient in your 70’s due to the higher mortality costs.
  • Duration: 10yrs, 20yrs, to age 70, while Employed, etc.
  • Level & Renewable products to a specified age offered.
A Policy contract that will pay out 100% of the time since the death benefit is predicated on whenever you pass away.
  • Has an internal Cash Value that is accessible while the Insured is alive.
  • Contracts can be designed to pay for themselves using policy values.
  • It is common for an equivalent amount of Permanent Life Insurance to be 6x to 10x the premium cost of Term.
  • Age and Health qualify you.
Permanent cash value Life Insurance Policy’s need to be reviewed periodically to:
  • Confirm cash value growth in on target
  • Premium funding is sufficient based on face amount
  • Policy design/type of Policy is working correctly
  • Permanent Life Insurance is often an overlooked balance sheet asset that is not reviewed.
Portfolio Based Life Insurance is offered PRIMARILY by Mutual Life Insurance Companies. The Contract performance is predicated on the balance sheet or Portfolio of the Insurance company. Portfolio Based Life Insurance is considered a cash equivalent asset.
  • Contractual guarantees for death benefit & cash value growth.
  • Lower volatility/risk/standard deviation than money market accounts.
  • No management decisions.
  • Never decreases in value unless you access and take out cash while you are alive.
  • Growth and performance is not correlated to (all) other asset classes like/such as stocks, bonds, real estate, commodities, & etc.
Universal Life Insurance – created in the 1980’s in San Jose, CA by E.F. Hutton & Executive Life. For the first time the industry “unbundled” life insurance. Meaning UL Policy growth was not determined by the balance sheet and investment performance return of the Insurance Co.
  • A major motivation for UL purchases comes from the sales presentation stating:
    • Premium payment flexibility
    • Tax and economic advantages/benefits provided to UL Life Insurance by the IRS.
    • The tax benefits are the same for all Life Insurance Policy types sold in the U.S.
  • 1st generation UL Policy growth was tied to money markets (paying 15%) in the 1980’s.
  • 2nd generation UL used Mutual funds through the stock market run from the late 80’s to the era of the 90’s… see Variable Life
  • 3rd generation UL uses indexing or Indexed Universal Life/IUL with a guarantee to not get less than 0% return & a cap or limit on upside growth… see IUL
It is important to review UL/IUL Policy’s to confirm they are appropriately premium funded, allocated, performance is on track, and the Policy was designed correctly by the Advisor.
Variable Life Insurance – developed during the 1980’s stock market bull run. Stock market mutual fund growth potential is still the primary attraction for purchasers of Variable Life Insurance.
  • Variable Life Insurance is most appropriate for Clients who want more upside (stock market) potential and are less interested in Policy growth & performance guarantees.
  • Accommodates Clients with after-tax $ into a tax-deferred growth & tax-favored distributions asset – Life Insurance.
  • Performance based on stock market and mutual fund investment selections.
  • Initially designed for UL policy’s/VUL then eventually traditional Policy contract types
Indexed Universal Life / IUL is the Insurance Industries newest product offering. IUL contract provides the Owner with a contract guaranteed to not get lower than 0% return that is tied to a series of indexes with a cap rate or participation rate on the upside that limits growth or growth in excess of these limits are shared with the Insurance Company to offset Policy costs.
  • Policy shortfalls or lack of performance in an IUL contract is the Owner’s responsibility. This makes it important that all IUL Policy’s (owned) be monitored and reviewed to ensure the IUL is appropriately funded, allocated, & performing.
  • Special attention to projected Policy values and growth at the Insured age 80’s.
  • Marketed and sold as “the power of untaxable wealth”, “tax-free retirement”, or “income and estate tax free planning”.
Secondary Guarantee UL provides a Policy contract that is guaranteed to stay in-force to a predetermined age or year. This is different than traditional Portfolio Based Policy or IUL in that an Owner forgoes the Policy cash values in place of the Secondary (death benefit) Guarantee.
  • The benefit is the Policy premium is less than a traditional Policy (around 25% to 30% less).
  • Advantage – Policy premiums are less than a traditional Policy (around 25%).
  • Disadvantage – is not having future cash value or access to Policy cash values.
  • You cannot make a change to the Policy without reducing or voiding the Secondary Guarantee.
    • Forget a premium payment, take a Policy loan, change the Policy benefit in anyway, etc.
  • SG Illustrations show Policy cash value disappear and go away around the Insured’s age 80(s).
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