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Rider improves cash surrender value

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Liquidity can be a problem for wealthy individuals who need large amounts of life insurance protection. AXA Equitable saw that as a problem and came up with a life insurance rider meant to alleviate the issue for wealthy policyholders. Its Cash Value Plus Rider is available on its Athena Universal Life Death Benefit product.

The CVPlus Rider works like this: It offers higher early cash surrender value for fully surrendered policies than for those policies without the rider. A onetime $250 fee buys two different ways for the rider to increase the policy’s cash surrender value:

  • For the first eight years, surrender charges will be reduced by a specified percentage:
  • Refunding a portion of the cumulative premium charges deducted during the first three policy years.

The rider must be elected at issue, with a minimum face amount of $1 million and $50,000 in annualized premium. Issue ages vary by class and tobacco status. A client can get up to 95 percent of required collateral with the policy alone.

“Our new CVPlus Rider makes it easier to act, by offering a flexible alternative for clients who are reluctant to move assets for purposes of posting collateral in premium financing arrangements,” says Claude Methot, AXA’s senior vice president and chief product officer.

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