Key Fact About Life Insurance Illustrations
Life insurance illustrations must be based on realistic assumptions and disclose that they are projections, not guarantees of future performance.
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Purpose and Use
Illustrations show how a policy's cash value, premiums, and death benefit could develop over time under specified scenarios, helping consumers compare products.
Regulatory Requirements
Regulators require insurers to label illustrations as estimates, include all assumptions used, and provide a disclaimer that actual results may differ due to factors like interest rates and policyholder behavior.
Common Misconceptions
Illustrations are not promises; they cannot guarantee investment returns or policy outcomes, and they may change if assumptions are adjusted.