SPLs Are MECs

When talking to their clients who are already in retirement, many financial professionals fail to consider and explain the benefits of Single Premium Life (SPL). 

Some agents are somewhat stymied by the fact that SPLs are Modified Endowment Contracts (MECs), which means SPLs are taxed in a similar fashion to annuities. Annuity agents should not find this subject very scary. Prospects who have money that they've planned to pass down to their heirs, save for emergencies, or use for opportunities, should consider a Single Premium Life policy. 

In many cases, clients who purchase life insurance, fund their policies with money they don't intend to use for income planning vehicles. So what they basically do is overfund a life insurance policy with one payment. In this type of contract, they are guaranteed a minimum level of growth throughout the product's life that can also eliminate much of the downside risk often associated with an equity investment. At this stage in many retirees lives, the risk tolerance level has really reduced. 

Not unlike annuities, SPLs have great liquidity where they can take annual withdrawals penalty free. And with many, they also have a money back return of premium guarantee at any time. Many of these SPLs look, talk, and walk like a hybrid contract.

In other words, if your client has the inability to do two of the activities of daily living was in a nursing home or required home health care, the entire death benefit goes tax free to your client to pay for those benefits while they are living and when they need the money.

For many clients who don't have traditional long term care plans, they can use Single Premium Life to help fund their post retirement medical expenses. These contracts also have a first year bonus that is as good as (or better!) than many annuities today.

If you'd like to know more about SPLs, and if you'd like us to show you how we have agents who are making well into the six figures selling this product, in addition to their annuity and life insurance business, then give us a call at 1-877-844-0900.

You see, Single Premium Life Wealth Transfer is not something new for Ohlson Group. We cut our teeth on this product and continue to be leaders with the main players in the marketplace. Another good reason to find out why agents from coast to coast refer to Ohlson Group as... a different experience!

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Until next time… good selling!
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Raymond J. Ohlson
Founder & Retired CEO
Ohlson Group
​1-877-844-0900