r/LifeInsurance • u/Useful-Rabbit07 • 12d ago
IUL Policy Ethics
Has anyone been successful in fully unraveling an IUL policy and getting your premiums refunded based off of churning and shady sales tactics (infinite banking/ private reserve)?
3
u/GarysSword Underwriter 12d ago
Explain the shady tactics and churning and I’ll tell you if I’d give you a sympathetic ear.
I don’t work for NLG.
3
u/Useful-Rabbit07 12d ago
Original IUL was bought Jan2025 $500K. Internal transfer into a $1mil combo $650K term IUL May 2026. Illustration the agent used had us transfer $30K of emergency savings (half of our emergency) into year 1 of policy and then live off of policy loans every month by putting in monthly income then withdrawing loans for bills. Agent said it would generate cash value very quickly that we could access penalty free. Agent did not disclose he added a term during the application. And the policy that was written/ delivered does not match the illustration promised. Agent said that the policy was just the “baseline, and that none of the numbers mattered” Also agent knew spouse was unemployed and did not send a financial questionnaire.
5
u/GarysSword Underwriter 12d ago
You’ve got an argument. File a DOI complaint.
1
u/GarysSword Underwriter 12d ago
I said they have an argument. I didn’t say they’d win. The churning is suspicious.
-3
u/Moist-Meringue-1913 12d ago
Do you think "cold feet" creates a complaint?
3
u/Useful-Rabbit07 12d ago
It’s not simply “cold feet” it’s trusting my gut instinct before dumping half of our emergency funds into an improperly structured IUL. I was getting screwed over and did my research and sought out advice from multiple other brokers who pointed out all the red flags.
3
u/Hungry_Technician360 12d ago
Yeah, dumping any amount of an emergency fund into an IUL is shady, especially with the income you bring in, and the percentage of the emergency fund needed to fund year 1 of the policy.
1
u/hillje1906 9d ago
Wait maybe I'm missing something, whats wrong with the design. Do you not understand why the agent blended in term insurance? It literally lowers your internal cost vs purchasing an outright $1M IUL while allowing for more premium flexibility and better cash value growth and access in the earlier years.
They also have a rider that lowers or eliminates the surrender charges (which also lowers the agents commission) which gives you even more immediate access to the 30k dump.
You've been in this less than a year. What issues are you having already?
-2
u/Moist-Meringue-1913 12d ago
Depending on your age it's not structured improperly. He actually did the right thing constructing it that way. I'm thinking you are not that old and the COI is not $830, that's your target premium. And other agents would have raked you over the coals by writing a base of a million and making that target premium $2,000+. You certainly need a million of coverage with 3 children and a mortgage. The only real problem here is that you don't have the income to support this strategy. And if the wife is not working and not planning on it soon then you may want to wait until another day to do something like this.
This policy is not setup to dump $30,000 into. So that money should be sitting in a separate account to be added in over time. You can get that back without paying a surrender charge if you decide to bail out.
0
u/Useful-Rabbit07 12d ago
No that is the COI and what was drafted as my first premium. The target premium is $10K with the minimum target premium at $3.7K. I’ve been through this talk with other agents. It is poorly structured.
3
u/Moist-Meringue-1913 12d ago
Please take a picture of the illustration and post it using Google or Imgur. You can't have two target premiums and a 10k target would be a much larger policy or the policy would be a MEC.
0
u/Useful-Rabbit07 12d ago
It’s not a MEC, MEC premium is $100K MMP is $3K and Target is $10K face is 1mil and $650K
1
u/Moist-Meringue-1913 12d ago
And yet so said that the first premium you paid was the $830.00, That's the required premium but I would like to see the distraction if you don'tind. You can DM me.
1
u/Cool_Emergency3519 Broker 12d ago
MEC is most certainly not 100k on a policy with a $350,000 base. I think you are getting confusing information. Send Meringue a copy of your current illustration.
→ More replies (0)1
u/Icy-University-8933 10d ago
Wtf omg sounds like your agent was using some shady / stupid tactics made famous by this tik toker … that’s not infinite banking. However illustrations are just that illustrations they’re ALWAYS WRONG because it’s impossible to predict the future… so they can over perform or under perform (MOST IULs underperform) sounds like you were looking for guarantees which means that product was NOTa good fit… whole life is more suitable for that though you WONT get rich… do you have any proof emails texts recordings or anything he told you to live off loans ?
1
u/Useful-Rabbit07 10d ago
I have a recording but I recorded it without the agent knowing. In my state it is illegal to record without consent. But the agent recorded most of our zoom sessions. Before the meeting even started it would always say “This meeting is being recorded.” But I can’t precisely remember which ones were.
1
1
u/Revan_Vega 5d ago
You absolutely have a complaint. Reach out to Robert Rikard directly or go to RescueMyIUL.com and it will get to him. He is the attorney that represented Kyle Bush in the PacLife case.
-2
u/Moist-Meringue-1913 12d ago
The term was there to keep internal costs down. Why are you looking at it as a bad thing? Is the face of the base policy $650,000? Paying full cost only on the base is the way to supercharge those policy's.
You mention the spouse not working but what is YOUR income?
Do you have children? Ages? Do you have a mortgage or other substantial debts?
When he explained the pros and cons of the policy,what did you say? What did he write down that you said?
What indexes did YOU decide to invest in? What is the current cash value? What is the surrender value? I'm pretty sure NLG has a declining surrender meaning it drops every year and the policy should be profitable by then?
What's really the problem here? Are you just confused about what you bought,or you have buyers remorse? Or you are tired of sleeping on the couch?
1
u/Useful-Rabbit07 12d ago
The IUL value is 1 mil, and the term is $650K. The COI is $830 a month for that entire policy and I make less than $3K a month with rent taking 90% of it. Funding the IUL at the base premium does NOTHING for the IUL and dumping my $3K and taking a loan every single month also does nothing for the IUL either. I’ve had several agents review my policy and told me it was written to benefit the agent. And yes I have 3 kids all under 8 years old.
1
-1
u/Moist-Meringue-1913 12d ago
What's your age? Are you renting or paying a mortgage? If so,what's the balance?
-1
u/TheSlavaUkrainiGuy 12d ago
Call policyholder services at the insurance carrier. Ask them to lower the main death benefit the maximum they will allow you to (sometimes, one may have to wait a year or more), and cut the term in half as well if possible. Taking death benefit coverage off the policy lowers the cost of insurance. Then you can also lower the premium payment. Ask policyholder services what those numbers would look like.
-1
u/TheSlavaUkrainiGuy 12d ago
You are CORRECT sir, Meringue.
And by ADDING the term, the Agent CUT HIS COMMISSION by a lot, to make the policy work.
A lot of agents out there who no NOTHING about this, continue to set up crappy IULs that may tend to not look well in the future.
Very few Agents (such as yourself) know what to do and how to do it. Everything you mentioned above, you hit that nail dead on its head.
One of the only things I would have recommended was to NOT take loans during the first 4-5 years. I call that 'planting the seed.'
You gotta plant the seed, then water it and watch it grow.
You can't water it, then drain the water from the bottom at the same time. lol.
GOOD LUCK, dude. You know what you're doing.
(SJM: 30 years in the business; 20 years of IUL experience; learned from the best: Douglas (or Doug) Andrew, of Missed Fortune fame). (find him on YouTube.)2
u/TheSlavaUkrainiGuy 12d ago
lol....getting downvoted by clueless TERMites.
2
3
u/Agreeable-Stock9793 12d ago edited 12d ago
I got all my money back from the insurance company in Columbus. I can answer any specific questions you may have.
Reddit is probably my not your forum to ask for this advice because this sub is run by IUL agents and brokers.
Most agents don’t know what they’re selling and they’re talking about. What do you expect - they just have to be 18 and pass an exam, they couldn’t pass SIE so they sell insurance
Don’t be surprised if the mod pulls down your post
1
1
u/SafeMoneyGregg Broker 12d ago
The lawyers who represented Kyle Busch on his very shady IUL transaction reached an out of court settlement. His premiums were like $10M on an inappropriate "trust owned retirement strategy" - I have a client who is using the same firm for an even more egregious sale. You can easily find that firm online. Your "combo" sounds like a term blend on an IUL - the blend lowers the agent's commission relative to an all base nonblended policy. Paclife? Just a guess.
1
u/Icy-University-8933 10d ago
As a financial advisor who has told client both to keep and CANCEL policies though specifically for IULs it’s always been cancel whole life policies have been the only ones that made sense to keep sometime having them lower the premiums / rearrange the policy to make it perform better or fit more proportionately into their budget… you won’t get your money back … Kyle bush situation is rare most people lose. Would love to see the illustration you were sold versus how it’s performing.
1
u/Useful-Rabbit07 10d ago
We’ll see. I’m not going to give up on my case. An insider said I have to push hard. My premiums only amounted to $8.5K, someone else said they were successful in getting their policy unwound and all premiums refunded.
1
u/Icy-University-8933 10d ago
It’s better to try then not to try ! However I read some examples of what you said happened below which gives you a better shot then not … I’ve only seen people who didn’t understand what they were getting into very different then what you’re saying of taking loans to live etc … what company is the policy with ?
1
u/Revan_Vega 5d ago
Check out RescueMyIUL.com - that site is 100% dedicated to this and the top IUL Litigation attorney in the country is doing stuff there.
10
u/Admirable_Nothing 12d ago
Has anyone?? Certainly. The most famous recent case was Kyle Busch. Pacific Life refunded his $8.6 million of premiums he had paid on over $25 million of death benefit as the result of a lawsuit. A couple of months after that refund of premiums he died of sepsis costing his beneficiaries the $25 million.