Friday, April 01, 2011
ACCORDING TO MR. ADEEL MANSOOR Universal life insurance (UL) is a
relatively new insurance product intended to provide permanent insurance
coverage with greater flexibility in premium payment and the potential
for a higher internal rate of return. There are several types of
universal life insurance policies which include "interest sensitive"
(also known as "traditional fixed universal life insurance"), variable
universal life insurance, and equity indexed universal life insurance.
A universal life insurance policy includes a cash account. Premiums
increase the cash account. Interest is paid within the policy (credited)
on the account at a rate specified by the company. This rate may have a
guaranteed minimum (for fixed ULs) or no minimum (for variable ULs).
Mortality charges and administrative costs are then charged against
(reduce) the cash account. The surrender value of the policy is the
amount remaining in the cash account less applicable surrender charges,
With all life insurance, there are basically two functions that make it
work. There's a mortality function and a cash function. The mortality
function would be the classical notion of pooling risk where the
premiums paid by everybody else would cover the death benefit for the
one or two who will die for a given period of time. The cash function
inherent in all life insurance says that if a person is to reach age 95
to 100 (the age varies depending on state and company), then the policy
matures and endows the face value of the policy.
Actuarial, it is reasoned that out of a group of 1000 people, if even
10 of them live to age 95, then the mortality function alone will not be
able to cover the cash function. So in order to cover the cash
function, a minimum rate of investment return on the premiums will be
required in the event that a policy matures.
Universal life insurance addresses the perceived disadvantages of whole
life. Premiums are flexible. Depending on how interest is credited, the
internal rate of return can be higher because it moves with prevailing
interest rates (interest-sensitive) or the financial markets (Equity
Indexed Universal Life and Variable Universal Life). Mortality costs and
administrative charges are known. And cash value may be considered more
easily attainable because the owner can discontinue premiums if the
cash value allows it. And universal life has a more flexible death
benefit because the owner can select one of two death benefit options,
Option A and Option B.
Option A pays the face amount at death as it's designed to have the cash
value equal the death benefit at maturity (usually at age 95 or 100).
With each premium payment, the policy owner is reducing the cost of
insurance until the cash value reaches the face amount upon maturity.
Option B pays the face amount plus the cash value, as it's designed to
increase the net death benefit as cash values accumulate. Option B
offers the benefit of an increasing death benefit every year that the
policy stays in force. The drawback to option B is that because the cash
value is accumulated "on top of" the death benefit, the cost of
insurance never decreases as premium payments are made. Thus, as the
insured gets older, the policy owner is faced with an ever increasing
cost of insurance (it costs more money to provide the same initial face
amount of insurance as the insured gets older).
Both death benefit options - A (level) and B (increasing) - are subject
to the same IRS rules and guidelines concerning premium payments and
tax-favored treatment of cash values. In order for the policy to keep
its tax favored life insurance status, it must stay within a corridor
specified by state and federal laws that prevent abuses such as
attaching a million dollars in cash value to a two dollar insurance
policy. The interesting part about this corridor is that for those
people who can make it to age 95-100, this corridor requirement goes
away and your cash value can equal exactly the face amount of insurance.
If this corridor is ever violated, then the universal life policy will
be treated as, and in effect turn into, a Modified Endowment Contract
(or more commonly referred to as a MEC).
But universal life has its own disadvantages which stem primarily from
this flexibility. The policy lacks the fundamental guarantee that the
policy will be in force unless sufficient premiums have been paid and
cash values are not guaranteed.
Early universal life policies are sometimes erroneously referred to as
self-sustaining policies. In the 1980s, when interest rates were high,
the cash value accumulated at a more accelerated rate, and universal
life coverage was often sold by agents as a policy that could be
self-paying. Many policies did sustain themselves for a prolonged
period, but the combination of lower interest rates and an increasing
cost of insurance as the insured ages meant that for many policies, the
cash option was diminished or depleted.
Posted at 11:44 am by shoaibishrat
Sunday, March 13, 2011
I turned my
computer on just to distract myself a bit. I couldn't think of anything
to do so I started browsing some old music. While scrolling down the
list I came across a song I hadn't heard for a long time. I played the
song and tried to focus my attention on the lyrics. I closed my eyes but
my vision didn't go blank, all this was being done by the song I was
listening to, stirring up all the old memories I thought I'd never be
able to recall again, may be cause I didn't want to.
let myself flow with the stream of memories. It reminded me of all the
days and nights we spent talking about music, about the songs you loved
and that was a sufficient reason why I loved them too, about all the
songs you dedicated to me and we never needed a VJ or RJ to do that for
us. It felt like I was being pushed into a world that was once real, but
now it all felt like a distant dream, just a flash of memory.
sentence in the lyrics brought some new memory to my mind. It was all a
mix of good and bad moments. Moments I never wanted to let go of and
moments I never wanted to see in my life.
Amid all this stream of
memories, the song ended. I opened my eyes and I couldn't realize what
expression I was wearing on my face. It felt like I had a smile on my
face and at the same time I could feel saline moisture in my eyes.
turned the PC off and went to find something else to beg some
distraction from. I turned on the TV and coincidentally, luckily or
'unfortunately' one of my favorite movies was being aired. Just minutes
after I'd started watching it, I felt like you were there sitting beside
me, that time felt not so long ago when we both watched that movie
together on that very sofa. It reminded me of the time when we discussed
each and every scene of the movie.
I turned off the TV too and
went out to breathe some fresh air. The sky outside was filled with dark
clouds which always made me so happy but today they seemed to be
laughing at me, suffocating me, sucking out happiness from deep down
inside of my soul.
Moments later I felt droplets fall on my face
and it started raining. Rain brought the most painful memories of all,
it reminded me of all the wounds I thought had healed, but I was wrong.
Why does the best time subsequently turns into worst memories? This question bothers me every now and then.
Now, there was nowhere else I could go. I had to endure the pain, I had to give in.
Whole Universe seemed to be confederate, ripping open all my wounds so ruthlessly.
They say that its been so long since you left me, but I deny them. That's because its only me who knows.. You're all around me !
Posted at 06:10 pm by shoaibishrat
Clouds were very dimly lit, as they absorbed the soothing silver light being bestowed by Moon which has hiding somewhere in the background. I stood there, trying to make sense of different things hidden in the dark. Things I couldn't see and things I could see even if I had my eyes closed.
The darkness was opening up the wounds, bringing out the pain so excruciating, it was ripping me into pieces. Darkness was like a bright Sun over my memories. The loudness of silence was intense and intolerable.
That was the time when I needed you the most, needed you like air, like a desperately thirsty wanderer needs water. But I knew you had gone, never to come back again. How much I wished that I had apologized and called you back in my life, how much I hated myself for letting you go. The pain intensified on the thought that you were never coming back.
There was nothing left in my life, whatever I had wished for throughout my life had gone for good. My only reason for existence had gone, there was no way I was gonna live through this pain. That was the end of me and with me, of all those mistakes, questions, justifications, fights, everything we ever did, all the time we ever spent together and all the dreams which never came true.
This could have been a dream but this time I had so many facts like scattered puzzles which evidenced the reality. Facts which were so afflictive, they rendered me almost numb. But there was no way I could force myself out of this tormenting reality, I had to endure this.
I had lost my focus on what I was doing, I could see but couldn't make sense of anything. Then something caught my attention. There was something in the dark shining like diamonds, I didn't know what that could be but after putting some more effort I could see that those were someone's eyes mirroring my expressions. Those eyes seemed to be as tormented as I was. The shape started to move closer and I was astonished at first. I had never thought that this could be possible, I had never thought in my wildest dreams that I'd ever be able to see 'YOU' again.
You stood there, waiting for my response but what could I do as a response, I was stunned. I somehow managed to get control of my feet and moved towards you. I could clearly see that you had been in a situation no different than mine. I couldn't realize what I actually felt at that time, it was all a shuffle of emotions emanating from my insides.
We sat on a flat rock and there was nothing to talk. Our eyes had exchanged a million expressions in a moment. I promised to never let you go again. While we sat there, clouds started bestowing light drizzles which eventually turned into a heavy shower.
The clouds seemed to be having their turn to tell their sorrows. And we sat there till the first ray of light emanated from East but still, it all felt like a moment. A lifetime seemed too less now.
All I knew now was you were with me and we'll be together forever and after forever !
Web Design By Shobi
Posted at 04:12 pm by shoaibishrat
only thing which has no restrictions on it, which is completely free
and you don't need to reach a certain age limit to have it, Dreams !
one can stop you from dreaming and interestingly no one can force you
to do so either. Dreams have been the reason behind marvelous inventions
and discoveries and at the same time, they've served as a point of
inception for huge destruction. Its a very interesting fact, a person's
perception depends upon his ability to dream. If he dreams big, he is
definitely an optimist. And if he's scared of his dreams being
shattered, he's a pessimist.
'Dreams Do Come True', only if a
person has that required level of zeal, enthusiasm and sincerity to
make it come true. Nothing can throw hurdles on his way to success then.
Nature designs his way and no other force is great enough to hamper the
force of nature. There is no way he'll be unsuccessful then.
intensity of dreaming depends upon a person's creativity and
perception. If one has an impression that something is impossible to be
done, it really would be impossible but only for 'HIM'. But if someone
is determined to do the impossible, nothing can stop him then. Of course
criticism might hamper his determination initially but this criticism
can make his sincerity toward his goal even stronger. Such is the magic
of constructive criticism.
Surprisingly this dream-big thing has been working quite fine for me. So go ahead and start dreaming !
Oh yes, you can even go and steal the moon (Despicable Me). Its all about dreaming big.
Web Design By Shobi
Posted at 04:04 pm by shoaibishrat
There was a time when everything felt like a source of smile...
There was a time when the slightest of humor made you laugh like crazy..
There was a time when nothing could penetrate the walls of your emotional stability..
There was a time when could laugh, sing and scream without any limitations..
There was a time when even the most depressing stuff could be let go without a second thought..
The only thing bad about that time was it's temporariness.. Why couldn't it stay for a bit longer!
And now there's time when everything feels to be caving in upon you..
Now there's time when your existence is given the least of attention..
Now there's time when you crave for freedom..
But the only good thing about this time is it's temporariness.. this too will go!Web Design
Posted at 03:46 pm by shoaibishrat