We love paid-up additions and if you've listened to us at all, you're not all that surprised. But we’ve made a little misstep in terms of being so broad in our discussion about them.
And we're always adding new people to our audience. So it bears repeating…
Not all paid-up additions are created equal.
While there are more characteristics with paid-up additions that are similar than different, there are some sharp contrasts that very much matter.
There are four key elements that you need to understand to make an informed decision before purchasing a whole life insurance policy using a paid-up additions rider:
1. Maximum annual paid-up additions payments
2. Lifetime maximum paid-up additions payments
3. Payment flexibility (can the policyholder adjust the paid-up additions rider up and down and can the policyholder make paid-up additions payments as lump sums throughout the year instead of systematically with the premium mode [annual, monthly, quarterly]?)
4. Paid-up addition rider load fees
You can’t just blindly assume that because a policy uses paid-up additions it meets the criteria that we would demand of a properly designed whole life policy.
If you'd like our definitive guide to paid up additions click the button below. Please note that if you already purchased this from us, do not buy it again…the information hasn't changed.
Here's a picture of the Table of Contents to give you a better idea of what's included:
If that looks like something you might find useful, please go over and purchase the guide here.
Edit: We are currently updating the guide and should have it available again soon.