Understanding the Policy Illustration: Reading Your Whole Life Projections

Before purchasing a Permanent Life policy, an insurance company is required to provide a **Policy Illustration**. This document outlines the expected performance of the policy and is vital for understanding the guarantees, costs, and potential non-guaranteed growth of your policy.

Key Sections of the Illustration

1. Guaranteed Values: Shows the absolute worst-case scenario. This projection assumes no dividends are paid and reflects only the minimum guaranteed cash value and death benefit. This figure is the foundation of the policy.
2. Non-Guaranteed Values (Current Scale): Shows the expected performance based on the insurance company’s current dividend scale or interest rate. This is the figure typically used in sales presentations and represents a realistic, but not guaranteed, projection.
3. Policy Summary: Details the annual premium, initial death benefit, and the internal costs of insurance.

The Importance of the Guaranteed Column

AdSense principles emphasize transparency. It is crucial for consumers to focus on the **Guaranteed Values**. While the Non-Guaranteed column shows potential growth, only the guaranteed column is legally binding, providing the true bedrock of your long-term financial security.

Disclaimer: This content is for informational purposes only and is not financial or legal advice. Never base a purchase decision solely on non-guaranteed projections. Always ask your agent to explain the guaranteed column.