Farmer's Premier Whole
Life
If
you are like most people, you're probably concerned about the safety of your
Life insurance funds and the policy's guarantees.
Farmer's New World Life Insurance Company has a product that can alleviate
those concerns. It's called Farmers Premier Whole Life
Farmers Premier Whole Life combines the safety of guarantees
found in traditional Whole Life insurance plans with the flexibility our
One-Year Term and Single Premium riders offer. This creates a dynamic Life
insurance product that may be the right solution for:
- young adults
just beginning an insurance program who need a basic plan to build upon.
families needing Life insurance protection
while saving for a down payment on a home, building funds for their child's
education, or to supplement retirement income.
- professionals
or small businesses needing a large amount of protection for a limited period
of time.
Farmers Premier
Whole Life is a permanent Life insurance plan with guarantees. The base Premier
Whole Life plan guarantees:
- level premiums
for as long as the policy is in-force
level death benefit
- cash value
To further enhance
this product, we have developed two riders which allow you the flexibility to
customize a plan to suit the particular needs of your family.
One
Year Term Rider (OYT)
The One-Year Term Rider enables you to design a
"blended" plan, a combination of permanent and temporary coverage (the base
plan plus the One-Year Term Rider). This rider allows you to add coverage on
yourself, and is renewable to age 70. It may be converted before your age 65 to
a permanent plan.
Single Premium
Paid-Up Rider
Similar to the One-Year Term Rider, the Single Premium
Paid-Up Rider provides additional Whole Life insurance and builds its own cash
value. Adding it can dramatically:
- increase the
policy's cash values in the early years
- reduce the time
it takes to "offset" the premiums
Issue limits range
from a maximum of what $200 premium will buy to a maximum of the amount of your
base Premier Whole Life policy.
NOTE: Depending on the amount of premium you pay in relation
to the sizes of your base Premier Whole Life policy and the SP Rider, the SP
Rider could produce a violation of the IRS "7-Pay test" and cause the entire
policy to be designated as a Modified Endowment Contract (MEC). MECs enjoy the
same advantages of tax-deferred cash value growth and tax-free death benefit to
your beneficiary as other Life Insurance products. However, any pre-death
distribution will be taxed as ordinary income. Distributions prior to age 59
and one-half may be subject to additional tax penalty. You may wish to seek
counsel from a tax advisor.
What sets Premier Whole Life apart from similar plans is the possibility future
premiums could be offset. How? Excess Credits.
Excess Credits
An
Excess Credit, put simply, is money. Each year, based on our future
expectations of investment, mortality and expense experience, we may declare
excess credits on your policy. These excess credits belong to you and can be
used one of four different ways:
-
Purchase Paid-Up Additions (PUA) - A Paid-Up Addition is Life insurance paid in
full by the amount of the Excess Credits. PUAs have a level death benefit, cash
value and earn excess credits. Put another way, we may provide the funds for
you to buy more insurance. Then, we may provide funds on that
insurance to buy even more insurance - without evidence of
insurability! You can imagine the compounding effect on your original
policy. This option is automatic, unless you request another option.
Paid in cash - Choosing this option
allows you to use the cash however you choose.
Reduce future premiums - If you
choose this option, we will apply the amount of the excess credit to the
premium. Your policy's death benefit, cash value and excess credits will not
increase as rapidly as if you purchase PUAs. Instead, your excess credits will
be used to reduce premiums each year. Eventually, the excess credits may become
large enough to offset the entire premium due each year.
-
*Add to the Deposit Fund - This option is similar to the second option in that
the excess credits are not applied to the policy. However, they are not paid
directly to you, but instead are paid directly into your Deposit Fund. If there
is a policy loan, it must be paid off before an excess credit can be deposited
into the Deposit Fund.
Excess Credits are not guaranteed.
*
Because the Deposit Fund is not available in Tennessee, Option 4 does not apply
there.
Optional Riders
(Available at additional cost)
Waiver of Premium - This
rider waives all premiums (except SP Rider premium) during your total
disability. The disability must begin before you are age 60 and last at least
six consecutive months. If you add both the Waiver of Premium and the One-Year
Term Rider, the premium will increase every year the One-Year Term Rider is in
force.
Accidental Death Benefit - This benefit is payable to the
policy's death benefit upon your accidental death due to most bodily injuries
before age 70.
Additional Insured Rider* - Provides level term
insurance on one additional immediate family member or other individual with an
insurable interest. Coverage is convertible to any available permanent plan,
through the additional insured's age 59 or within 60 days after the base
insured's death through the additional insured's age 70. Minimum face amount is
25,000 and the maximum is base policy's principal sum, plus One-Year Term Rider
an Single Premium Rider. Coverage terminates at the additional insured's age
70. Issue ages 18-60.
*Not available if Family Insurance Rider is selected.
Chidren's Rider - This rider provides level term insurance on
your children age 15 to 19 years as well as any children you may have in the
future. The coverage is to the child's age 22, or your age 65, if earlier and
may be converted to a permanent plan.
Family Insurance Rider* - This rider provides level term
insurance on your spouse, plus a monthly income benefit to the surviving family
if your spouse dies before age 50. Coverage is to the primary insured's age 65.
The same amount of level term insurance is provided at no additional premium to
your children age 15 days to 19 years and all future children you may have.
Coverage is to the child's age 22, or your age 65, if earlier. Coverage on
spouse and children may be converted to a permanent plan.
*Not available if Additional Insured Rider selected.
Deposit Fund*
This
optional side fund may be used to build cash reserves for the future. Payments
may be made into the fund if there is no policy loan outstanding, subject to a
$25 minimum. Interest is compounded annually, and the fund earns a competitive
current interest rate. The interest rate will never fall below a guaranteed
minimum. Ask your Farmers agent for the current and guaranteed rates.
*Retirement Premium Deposit Fund in Kansas; Not avalable in Tennessee.
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