The Visible Policy
In-Depth Analysis of One
Participating Whole Life Insurance Policy
by Rich Franzen

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No content within The Visible Policy has been approved, authorized, or verified by New York Life or any of its representatives.  I have attempted to fairly and accurately portray the policy, but there are likely to be mistakes.  Over time, I shall endeavor to correct any misinformation found herein.


Introduction

Several years ago I purchased a "Whole Life" insurance policy from New York Life.  I had no idea how it worked.  I knew my premiums would stay the same, and I could keep coverage for my entire life.  And I knew the policy was building up cash value, which I could use for a loan or get back should I decide to cancel ("lapse") the policy.

But what the heck is a participating Whole Life policy?   What exactly are the premiums "buying" me?  How much does the policy earn?  And, of course, "Am I getting screwed"? You might be interested in what I have figured out.

The chart and numbers below are basically all I knew to start with.  These are from the "policy illustration" (a spreadsheet print-out of projected policy performance over time) which my agent gave me.

Here are some of the specifics:

  • face value:   $100,000
  • annual premium: $1,764
  • out-of-pocket: $21,168
    Not guaranteed -- assumes
    dividend projections are met

  • initial age:        42
  • policy date: 10 May 96
  • non-smoker
  • Whole Life AD95
  • issued in Florida

  • chart displays expected
    Death Benefit vs Cash Value
    (data from my "policy illustration")

  Policy Illustration: Base Policy Death-Benefit vs Cash-Value
click to separate

(most images here can open into their own window)

Getting Started

The Visible Policy is a large site.  I certainly do not expect many people to read it from the first link to the last.  There is a lot of information here -- only read what is interesting to you.  What you might want to do is spend 30 seconds or so reviewing the Table of Contents.  If a topic looks like it might interest you, click it.  If not, you are welcome to return any time.

As the world's leading expert on this site, let me offer a few navigation strategies.



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Accesses since 31 May 2001
last modified 22 November 2010
2001 - 2010 by Rich Franzen

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No content within The Visible Policy has been approved, authorized, or verified by New York Life or any of its representatives.  I have attempted to fairly and accurately portray the policy, but there are likely to be mistakes.  Over time, I shall endeavor to correct any misinformation found herein.
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