Published On: Fri, Jan 23rd, 2015

Life Insurance 2.0

By: Ted Berstein

The future of the life insurance industry has arrived.

Every aspect of it is benefitting from creative destruction, separating the winners from the rest who continue to resist progress. Your current life insurance policies are outdated, unless you are part of a small percentage of people with underwriting issues that prevent you from receiving standard coverage. In other words, it is likely that your existing policies are antiquated, especially whole life, universal life and variable policies. It does not matter that you bought them within the past 5, 10 or 20 years, when you were younger. You are paying too much for too little.

Be a winner. Based on 30 years of experience and after reviewing thousands of inforce policies, it is safe to say that most people can do better. To upgrade and enhance your coverage, you must begin making wise choices:

  • Trade up for a policy that allows you to draw against the face value of the policy in the event of a critical, chronic or terminal health problem.
  • Consider a policy without commissions for cash accumulation policies. These policies eliminate or minimize built-in loads and surrender charges.  They perform better when it matters.
  • Turn a $2,000,000 policy into a $4,000,000 policy so your kids don’t turn it into zero. You can nearly double the face amount by telling the insurance company you want the installment payout option which creates a guaranteed income stream paid to your beneficiaries over time.
  • Private financing can be a powerful strategy to borrow premium payments and keep your capital at work.

Don’t get stuck on labels. Should you buy term or whole life? Instead, you should consider a flexible premium and flexible duration policy that will let you keep it as long as you need it to last. Many feel that permanent insurance is too expensive – term doesn’t take you far enough. With a flexible premium policy, you decide if and when you don’t need coverage any longer, not the insurance company. Ask most 50-something’s if they miscalculated about how long they needed the term policy they last purchased. The need for life insurance should be viewed along the spectrum of a lifetime. At 30, it’s about protecting income for your family. At 50, it’s about protecting income, business purposes and wealth preservation. At 70, the “need” shifts to wealth preservation and legacy issues.

Your old life insurance policies served you well but chances are you can do better. If you are in good health today, including those of you with previous heart disease, 20 extra pounds or well managed high blood pressure, you can improve your coverage. “I am older now,” is not a valid reason for hanging on to outdated policies. It is intuitive thinking; it’s just not accurate.

Life Insurance policies today are superior for many reasons:

  • Increasing life expectancy and more people reaching life expectancy.
  • Increased competition between life insurance companies.
  • A secondary market that has spurred carrier innovations.

Since the financial crisis in 2007, innovation has been called upon by a growing number and led by a committed few. It is impossible to accurately predict what meaningful and lasting change will occur from this long, overdue culture of innovation. With this column, my goal is to continue raising awareness about the worthy products, trends and life insurance concepts that have arrived.

I am NOT suggesting that a person should arbitrarily give up existing coverage for new coverage. I AM suggesting that every life insurance consumer review their inforce policies on a regular basis, starting today. It should be done with guidance from a life insurance professional – there is no upside to go at it alone.

Life Insurance 2.0. The next several decades will be defined by constant, meaningful change. The future will include products that are defined by flexibility, disclosure and a “customer-first” focus. Let go of the pre-conceived ideas you have about life insurance such as “I’m all set” or “I bought insurance 5 years ago” or “I only buy term.”

That’s how you win in Life Insurance 2.0.

Visit or for more information about life insurance or call us in Boca Raton at 561-988-8984.

Ted Bernstein is a third-generation licensed life insurance specialist and nationally recognized industry innovation expert in alternative distribution strategies and life insurance product development with decades of speaking out and advocating for changes on behalf of consumers. He was the first to introduce life insurance without commissions or “no-load” life insurance in the mid-1980s and launch the first fee-based Life Insurance Policy Audit and Review service for trust companies and life insurance fiduciaries. A recent innovation, the Installment Payout Option, is game-changing. To learn more, visit or call 561-988-8984.

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  1. […] Life Insurance 2.0 Should you buy term or whole life? Instead, you should consider a flexible premium and flexible duration policy that will let you keep it as long as you need it to last. Many feel that permanent insurance is too expensive – term doesn't take you far … Read more on The Boca Raton Tribune […]

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