Talk:Whole life insurance

Bias concerns

I am a Investment Advisor Representative of my own Registered Investment Advisory firm. This is frankly one of the most biased and misleading articles I have ever seen on Wikipedia. I only have not immediately edited it because I am a fledgling Wikipedia editor and was not sure of protocol. Firstly, the article is not merely missing a citation where it claims whole life policies were invented as a result of consumer demand. I am unsure of the development of whole life insurance; however, I do know it is currently sold because it generates a lot of revenue for insurance companies and thus, commissions for insurance brokers. Furthermore, footnote #1 references an article in the CPA journal, which is written by a Joseph E. Godfrey III. I had immediate suspicions that Mr. Godfrey was a life insurance salesman. I believed this because most independent and unbiased financial professionals do not recommend whole life insurance. A simple check on FINRA's brokercheck shows Mr. Godfrey is gainfully employed at MML investor services. MML services is a member of the MassMutual Financial Group. MassMutual sells whole life insurance as one of its core business operations. Will someone with the correct knowledge please let me know the protocol for fixing this? It is factually incorrect and incredibly biased.--Mendress9 (talk) 06:46, 28 April 2011 (UTC)

--Mendress9 (talk) 06:38, 28 April 2011 (UTC)

Mendress9, I am the author of much of the text in the whole life article. Other than being the owner of a whole life policy, I have no connection with the life insurance industry. The one specific potential problem you point out, "created as a result of consumer demand", is not a point I added (though I believe it to be true). The rest of your complaint seems to be an attack on the article because of a reference to Mr. Godfrey, who I do not know. Your anti-whole_life bias is clear, IMO. What would you have the article say? Reduce it maybe to two sentences -- "Whole life sucks. Don't buy it!" -- ? I believe the POV citation should be removed, until such time that someone can actually demonstrate specific instances of bias or inaccuracy. – 2*6 (talk) 19:35, 30 May 2011 (UTC)

I should have answered your specific question. Just like any other editor, you can fix the article by correcting any factual inaccuracies. I'm guessing you want to add some negative aspects of whole life. You can do that too. Consider adding a "Pros and Cons" section, where these would fit nicely. Of course, to avoid a diatribe, you'll have to find a positive aspect or two. Go on -- it will be good for the soul.  ;) – 2*6 (talk) 20:11, 30 May 2011 (UTC)

I'm a Life Insurance Agent with 49.5 years experience, hold the CLU & ChFC designations. I hold that THERE ARE NO UNBIASED OPINIONS when it comes to whole life. What I can tell you is that (at age 80) it's the only insurance I have, and it's doing quite well for me, thank you very much. Term life would be excessively costly for me at my age. One of my policies is a Single Premium whole life, which produced a return of 1.3% (tax free) last year. I have money in the bank which paid me .25% (taxable) during the same time frame, not to mention the added value of the insurance.

I hold that is is fallacious to compare whole life with a combination of term and equity investments. Since insurance cash values are guaranteed principal, it is more accurate make the comparison using term and savings, or other fixed dollar investments.

As to the charge that whole life is sold to generate fat commissions, that is a half-truth at best. There are good and valid reasons for including whole life in a financial portfolio. And I have Universal life policies on the books that are generating 4.5% guaranteed interest rate, which looks pretty good when the stock market is down. Finally, show me an RIA who is unbiased. I am dedicated to the proposition that life insurance should be tailored to the needs and goals of the individual. Some will be better served by term, others by whole life, but most will be best served by a combination. MiltChFC — Preceding unsigned comment added by MiltChFC (talk • contribs) 22:37, 10 January 2015 (UTC)

From an actuarial perspective, there is no such thing as "good" or "bad" insurance. Whole Life, Term, etc. are all just arrangements of probabilistic cash flows and there is a right price for each. "Good" insurance is insurance that fits an individuals needs. Kmaricq (talk) 04:13, 10 December 2015 (UTC)

Visible Policy link

Disclaimer: I added an external link to my own, completely non-commercial site, The Visible Policy. Please review for appropriateness. Obviously I feel the site is of high quality and a good fit for Wiki's article on Whole Life Insurance. Yet someone else should review for appropriateness. 2*6 09:15, 28 November 2006 (UTC)

I don't know User:Dozen, nor do I know insurance (which is why I'm looking it up on Wikipedia! ;^) ) but from my casual glance at The Visible Policy it seems to be a comprehensive description of the information that one individual accumulated in his quest for answers. Is the website original research? I don't know yet - I (or someone else) should check its citations for verifiability, especially in this case of a self-published source. Is it commercial? It sure doesn't seem to be. Can I vouch for it unreservedly? Not yet. Do I think that the author deserves kudos? Absolutely. --Eliyahu S ^Talk 06:05, 15 January 2007 (UTC)

Thanks, Eliyahu.  :) Let me be bold and answer some of your points. IMO, the VP site would classify as original research, which should be fine as an external link, right? I.e., the wiki article itself is not original research, it merely includes mention of something that is. What is a citation if not a pointer to someone else's original research? And yes, it is a self-published source (hence this very disclaimer to which we comment). Why should it be an exception to the "largely not accepted as sources" rule? Well, if the site itself doesn't convince you of its exceptionability, how about a peek into the pains I went to author it accurately and neutrally? See the Usenet thread whole life comparison with BTID. Most verifiability is self-contained within the site, though, which includes a facsimile of each of the annual statements I have received to date (example Statement for Policy Year 9). As far as being commercial, if it is I should get an award for the most boring commercial ever produced! :) There are no ads and it produces no income. The VP is careful to maintain a neutral point of view (for example, it never says that whole life is better than term, or vice versa). It wasn't easy to not let my opinions out though; they went into another site, the Life Insurance GlossPinion. – 2*6 10:05, 15 January 2007 (UTC)

Two additional points. The article was written before I added the VP link. I.e., VP was not used as a reference for it. The link is in the section labeled "External links", not a section labeled "References". (Which, unfortunately, does not yet exist. I'll see if I can rectify that -- but not from my site!) The other point is to reinforce my site's verifiability. I had a 3rd party professionally evaluate my policy, and VP includes those results. – 2*6 13:42, 15 January 2007 (UTC)

Removed globalize and unreferenced templates

The article has been expanded. It includes certain key Commonwealth terms and 4 footnotes. It is still not perfect, but IMO has been globalized sufficiently to warrant removal of globalize tag. The footnots so far are confined mostly to new information I added. I've looked for citations on what earlier others wrote, but so far no luck. My personal experience tells me that stuff is factual, and I don't want to completely rewrite a basically good article just because I personally haven't found the sources used by earlier authors. – 2*6 23:46, 16 January 2007 (UTC)

Assurance vs Insurance

There tends to be a use of both life insurance and life assurance these days. The fact a company can market a product and call it Whole of Life Insurance is irrelevant to the correct generic term. The former covers events that might happen (e.g. car theft) whereas the second is for something that is a question of WHEN? (e.g. death) rather than IF? [1]. That said, it would not be incorrect for a fixed term policy to be called life insurance as death is not necessarily going to occur in the set term. However, when one talks of a Whole of Life contract, there is no grey area, the correct noun is Assurance. Dainamo 10:10, 15 February 2007 (UTC)

From my perspective, insurance is the correct noun for all types. Insurance refers to a type of legal contract, while assurance is an act (usually verbal) intended to produce comfort or confidence in another. Kmaricq (talk) 04:17, 10 December 2015 (UTC)

Introduction summary

Whole Life Insurance, or Whole of Life Assurance (in the Commonwealth), is a life insurance policy that remains in force for the insured's whole life and requires (in most cases) premiums to be paid every year into the policy.

If I am understanding the article, this is written a bit misleadingly - when I first read it, I had the impression that the death benefit was only paid if the dead person had been paying all his premiums and so it wasn't much different from term insurance. Then I read further, and apparently, the idea is more like, the death benefit goes up over time as the premiums are paid, but if someone stops paying the premiums the death benefit is still paid but it's just whatever small amount he had left it at with his last premium payment. --Gwern (contribs) 15:58 12 February 2011 (GMT)

A simple break down

Very Briefly,

I would like to start by saying I am a licensed insurance agent and I sale all four types of life insurance, Term, Whole, Universal, and variable. And yes, there are four. All have their place and are useful at reducing risk. It is naive to simply say one is bad and another is good. It depends on the person’s needs and resources.

Term Life is great for reducing the risk of the loss of someone’s income for their loved ones. “What would happen to the house and the children’s college funds if I passed away?” Term insurance is also the least expensive way to purchase a substantial death benefit on a coverage amount per premium. The down side is after that period expires coverage at the previous rate of premiums is no longer guaranteed, and often higher if available at all, and the client must either forgo coverage or potentially obtain further coverage with different payments and/or conditions. Term insurance is commonly the least likely to pay out.

With whole life you most likely would have a much high premium that would stay the same throughout the length of your life or until the “paid up” date. These policies are the most likely to pay out. Universal and Variable policies both have a larger investment side and are usually sold as whole life. These policies can be extremely handy in investing but can also be extreme dangerous too. I typically steer clients away from these if they are not already familiar with investing and returns, or have an estate planner.

All policies can include riders that add benefits to the policy. Some riders can include coverage for children or grandchildren, some remove the requirement of premiums in the event of extreme illness or injury, some add cover for accidental death, and many more.

When buying any kind of insurance first understand your needs and work to understand the products available to you. Make sure you get a copy of everything promised IN WRITING and review that with your policies/contract when you get it. All life insurance comes with a grace period for you to be able to review the contract, it is called a free look period.

I hope this helps — Preceding unsigned comment added by Kade77 (talk • contribs) 23:46, 28 July 2011 (UTC)

OH MY!

I am bombarded by insurance junk mail. I know I desire something for my children/grandchildren or husband when I pass to a better place than here! I know nothing about insurance...who is just out to fraud me or is the honest one. I just want to leave my loved on financially secure or if my husband goes before me then myself and our loved ones are taken care of. I looked on here for answeres and only leave more confused. Thanks for nothing. Why does everything have to be an arguement? Perhaps because insurance is a scam and your all scammers fight for the mighty hard earned dollar. I guess I will just decide on nothing. — Preceding unsigned comment added by 208.118.155.129 (talk) 18:41, 5 January 2012 (UTC)

As an insurance professional, I can appreciate your disappointment with the Wikipedia article. Articles of this type should be written by professionals who are knowledgeable in the field, which this author is not. I cannot recommend whether whole life is right for you without knowing your age and circumstances. What I can tell you is that it is not a scam. This is a complex subject, and deserves better treatment. MiltChFC — Preceding unsigned comment added by MiltChFC (talk • contribs) 22:43, 10 January 2015 (UTC)

The Indebted View

Just briefly..The general view of the term vs. whole life argument is (again, generally speaking) this -- Life insurance should be used to indemnify ("bring/put you back to even") a family/business/etc. Nothing more. i.e., if as a husband, you are contributing 50% of the household income, you need coverage that would replace your income (plus some) for a defined period of time. This is important, mainly, when thinking of debt. If your family has a mortgage, car loan, and is saving for a child's college education, etc., income earners need coverage that would allow for their family to pay off their home, car, and at least get a good start on the college fund -- as well as give the family time to downsize, if necessary, and step into their "new" (albeit devastatingly sad) life. This means two things: 1) Life insurance shouldn't be used to get ahead in the case of loss, and 2) it isn't necessary in the later years of life. Don't throw anything, whole life agents; just bare with me. Once you've paid off your mortgage, car loan, and other debts, there is no need for indemnification. One income or two is not going to matter at this point. Now let me handle the other side of the debate. The idea is this: Term is much, much cheaper than whole life -- yes, the downside is after the term is up, you're not covered -- but the idea is "Buy term, invest the difference." Invest, or as I like to point out, pay off your mortgage more quickly. Pay for that car, put some away for junior, and then put it in the market. (If you don't know what the Rule of 72 is, go look that up really quickly.) Now, with that information in mind, do you see why you don't need a $100,000 policy at 65? The money you've spent on whole life premiums could have been much better used elsewhere. Term and whole life pay out just the same. The difference is that whole life policies are, as was mentioned above, WHEN, not IF, policies. The companies know this just as well as you do, and they charge you for it. Those companies have many more death claims, and have to spend exponentially more money. Above someone said that term policies only pay out 2%-3% of the time, now I'm not sure if that is accurate, but if that is, it's good news for the consumer. If out of every 100 clients a company has, they only pay claims on 3, they are making a bundle of money, and generally, those revenues get passed down in someway. In this case, cheaper premiums. Common sense says that whole life clients that hold on to their policies for their whole life are going to have them pay out -- with that being said, the company has to make their monies worth, and I can assure you that very few of their clients pay $100,000 in premiums over the course of their lives. Simply do the math. Now, my disclaimer: That certainly does NOT mean that "Whole life sucks. Buy term". Each individual has different needs. But make sure to do your research before just buying what's put in front of you. Commissions from whole life are far greater than commissions from term. People aren't ALWAYS out to help.

Hope that helps. — Preceding unsigned comment added by 76.123.178.205 (talk) 00:55, 24 May 2012 (UTC)

This paragraph is more helpful than the entire article. And by the way, the article is garbage. It doesn't even define whole life insurance or what it does. Miqrogroove (talk) 15:47, 1 December 2013 (UTC)

Good paragraph. I'd like to point out, that while I am personally choosing Term, Whole Life has several good uses. Examples: funeral costs, or estate planning. Kmaricq (talk) 04:20, 10 December 2015 (UTC)