Simplifying Unclaimed Life Insurance Policies
Saturday, August 30th, 2008The simplifying unclaimed life insurance policies presentation approach makes it possible to produce future cash-value graphs. Specified for a particular duration, these graphs show the impact of compounding rate and cost assumptions on future cash value. In the illustration of future cash value at 35 years, the top curve indicates the maximum cash value–an unrealistic maximum for a life insurance policy because it implies zero costs–after compounding 35 years of $2,502 premiums at the rates shown.Similarly, minimum cash-value figures have been plotted as the bottom curve, based on the maximum assumed costs at various compounding rates. Both fungible present-value and future-value analyses offer the advantage of evaluating all costs and benefits from one time period, either the beginning or the end.