The current low interest rate environment has focused more attention on universal life (UL) insurance minimum interest rate guarantees. And Manulife welcomes the attention. Why? Because InnoVision’s minimum interest rate guarantees are highly competitive at both an account level and policy level. Here’s what I mean by account and policy level:
Account Level:
This is where the UL provider guarantees that an account will offer a specific minimum interest rate. However, the UL provider may reserve the right to remove the account. If that happens, the guarantee is lost.
Policy Level:
With this type of guarantee the UL provider contractually guarantees to always offer an account with a specific minimum interest rate for the life of the contract. Policy-level guarantees are key. They provide more certainty as to a client’s reinvestment risk and allow advisors to illustrate at the guaranteed minimum rate with confidence.
Now, more than ever, strength in minimum interest rate guarantees are what clients and advisors are looking for when comparing UL policies. And as you can see from the chart below, which compares the bonus versions of several UL policies, InnoVision shines bright:
| UL product |
Account-level GIA guarantees |
Policy-level GIA guarantees |
||
| 5 year | 10 year | 20 year | ||
| Manulife InnoVison | 2% | 3% | 3% | Guarantees to offer at least one GIA with a 2% and one with a 3% minimum interest rate |
| BMO Life Dimensions | 1.25% | 2% | NA | Guarantee to offer at least one GIA with a 2% minimum interest rate |
| Canada Life Millennium | 2% | 2.5% | NA | Guarantee to offer at least one GIA with a 2% and one with a 2.5% minimum interest rate |
| Empire Life Trilogy Plus | 0% | 2.5% | 2.875% | Guarantee to offer at least one GIA with a minimum 2.5% interest rate and one with a minimum 2.875% interest rate |
| Sun Life Sun UL |
2% | 3% | 3% | Guarantee to offer at least one GIA with a 2% and one with a 3% minimum interest rate |
| Transamerica Estate Advantage | 1.75% | 2.5% | 3% | Guarantee to offer one GIA with a 3% minimum interest rate |
| Industrial Alliance | 2% | 3% | NA | Guarantee there will be at least 1 GIA available |
*25 year GIA
