Frequently Asked Questions
What does “load” mean?
In the context of a financial product, “load” usually refers to the sales commission. It is deducted from money you pay to purchase or invest in a financial product either (1) up front, (2) over time, (3) as a surrender charge if you quit early or (4) as a combination of the three. In a typical life insurance policy, the sales commission can represent as much as 100% of your first-year premium. When you buy an Ameritas Advisor VUL policy, you avoid much of these costs and eliminate surrender charges.
Is there a limit to how much I can put in the policy?
Yes, there is a limit to how much premium can be put into the cash value in the first 7 years for the policy to retain all its tax advantages. If premiums exceed 7-year IRS guidelines (which vary by age and gender of the insured and must be calculated by the insurance company) a Modified Endowment Contract (MEC) is created. While a MEC still offers tax-deferred growth potential, there are unfavorable income tax implications if you borrow or withdraw from or surrender your policy. You'll also experience a 10% tax penalty on any gains distributed prior to age 59 1/2.
Are there other tests to make sure my policy retains the tax advantages of life insurance?
Yes, there are two alternative tests for determining whether a policy meets the requirements to qualify as a life insurance contract. The test selected can have a significant impact on premiums, cash surrender values and death benefits. The Cash Value Accumulation Test (CVAT) limits the account value relative to the death benefit. The Guideline Premium Test (GPT) limits premiums paid relative to the death benefit. Generally, the GPT offers more long-term premium flexibility and lower cost of insurance charges over a long period of time. CVAT offers the highest death benefit at your life expectancy although it does allow for a lower death benefit based on initial premium at issue.
Once I own the policy, can I change the amount of coverage?
Yes, you can change the death benefit as your needs change. Death benefit increases are subject to an administrative charge, an additional cost of insurance charge, and may also require new medical information. The death benefit can be decreased to $50,000.
What happens when I apply?
When we receive your application, an Ameritas associate will contact you and ask for additional information about your health and family history. The associate will arrange a time for a trained medical professional to come to your home or office to gather weight, height, heart rate and blood pressure information and collect a sample of blood and urine. We will notify you when your application has been approved, and your policy will be mailed to you.
What happens when the policy is issued?
We will notify you when your application has been approved, and your policy will be mailed to you. When you receive the policy, you have a ten-day “free look” period. During this time, your initial premium is allocated to the Vanguard Money Market Portfolio. If you return the policy within the “free look” period, all monies are returned to you. If you do nothing, after thirteen days from the issue date, your premium is allocated according to your instructions.
How can I keep track of my policy values?
You'll receive regular statements regarding the progress of your policy each time a premium payment is received or when a partial withdrawal, loan, investment portfolio transfer or other change occurs. In addition, you will receive quarterly statements of current policy values, including a breakdown by investment option and annually you will receive a report detailing the past year's activity. You can also check on the current value of your investment options and benefit options by logging on to our secure web site via the link on the home page.
How do I make online trades?
Making online trades is easy and convenient. Simply go to the home page and select the Online Trades button. You can be sure your trades will be secure. You’ll be asked to sign in with a user id and password. Select your policy(ies) and choose Start Online Trades. After entering your daytime phone number and e-mail address, you can choose to make an Interfund Transfer, Portfolio Reallocation or Cancel the Previous Transaction. Use whole dollar amounts or percentages. After a Verify screen, you’ll submit your transaction and receive an e-mail confirmation. At anytime, if you have any questions, you can contact the Trade Desk at 1-800-745-1112.
|
Need Help?