I realize that this is like one of those insurance guy things. We get all excited when some really good product is about to change (not for the better), or we get wind of a rate increase. It’s a chance to get the word out and hopefully do something good for someone.

Ultimately is usually ends up being something that is talked about amongst agents and ignored by those who could benefit the most. Some weeks ago I brought up the fact that what is arguably the best permanent life insurance product ever, is about to hit the post mortem pile. Universal life with a no lapse guarantee has been the best thing since 30 year term insurance and the second best thing since sliced bread.

It’s strength comes from external company guarantees rather than internal cash value as with whole life and traditional universal life. It makes permanent life insurance truly affordable. It takes the guesswork out of the guarantees. Simply put, it is the best permanent product to ever hit the industry.

My post a few weeks back had to do with an initial indication from a few companies that they would either do away with the product or raise its’ rate for future sales. My reason for screaming this from the blog tops is that there aren’t that many chances that come along to get something great before it slips away. If you already have it in force or purchase it before changes are made, the good deal is yours from now on, guaranteed. If you miss the boat, well, then you missed the boat, guaranteed.

Prudential has announced that it will be raising the price on it’s no lapse guarantee products in April. While the increase, at least so far, looks like it may only be 5%, keep in mind that these are permanent products and that means 5% more from now on until you die or lapse the policy out of boredom.

I actually think the boredom thing is the end to most policies. People just get tired of paying and not dying. At some point that life insurance premium has to go through a stress test. For younger people it could be that their monthly premium is just a little too close to the cost of a case of beer. For someone my age it could be that the annual premium is awfully close to the cost of a week in Belize.

Sorry. Digressed for a moment there, but the point leads back to just exactly why people, if they have permanent products that could be improved upon or have been adding permanent products to their portfolio, need to leap while the leaping is good. If the price is right the life insurance policy has a better chance of withstanding the boredom test.

Bottom line. The snowball is gaining size and momentum. I predicted in January that by summer virtually all no lapse guarantee products would be affected. I think I’ll stick with that. Buy now or forever hold your peace.

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