Life Insurance Policies - Variable Life

Agents selling variable life insurance must:

-be registered with FINRA -have a securities license -be licensed by the state to sell life insurance

Regulation of Variable Products(SCE, FINRA, AND MA)

-dually regulated by the state and federal gov't. -due to the aspect of investment risk, it's considered securities.

Variable Life (or variable whole life)

-is a level, fixed premium, investment-based product with a guaranteed min. death benefit. -cash value is not guaranteed and fluctuates with the performance of the portfolio. -policyowner bears the investment risk - a separate account is kept for the policy -all persons with access to the assets of separate accounts must be under the bond of at least $100,000.

The commissioner's authority

-to review and approve all contracts or persons who have custody of the funds in separate accounts, and may request any information needed to assure that suppliers are complying with all regulations. -any person who handles separate accounts assets for the insurer cannot have any convictions of felony or misdemeanor involving embazzlement, fraud, deceit, knowing misrepresentation, or securites law violations within the last 10 years.

Features

Policy Loans: can borrow cash value Key features: Permanent insurance Premium:Fixed (if whole life);flexible (if universal) Face amount: can increase or decrease to a stated minimum Cash value: not guaranteed; separate account Policy Loans: Can borrow cash value