SBLI is making a move to become one of the best whole life insurance companies in the U.S. In the following Savings Bank Mutual Life Insurance Company of Massachusetts review, we will take a close look at the company’s products and ratings to help you decide if SBLI is the right fit for you, based on your own need, goals and objectives.
Review of SBLI Life Insurance Company
Before we proceed to our review of the various products SBLI offers, let’s take a moment to learn more about the Company.
About The Savings Bank Mutual Life Insurance Company of Massachusetts
The Savings Bank Mutual Life Insurance Company of Massachusetts was founded by a Supreme Court Justice back in 1907. The Company is domiciled in Massachusetts and is also has its headquarters located in Woburn, MA.
The Savings Bank Mutual Life Insurance Company of Massachusetts, AKA “SBLI”®, AKA “The No Nonsense Life Insurance Company”®, became a mutual life insurance company in 2017. SBLI currently registers as a mutual company in 48 states, going by its new name The Savings Bank Mutual Life Insurance Company of Massachusetts, except in Connecticut where it goes by the name Centrian Life Insurance. In California and one other state, the company goes by The Savings Bank Life Insurance Company of Massachusetts.
Savings Bank Life Ins Co of MA
One Linscott Road
Woburn, MA 01801
Note: Interesting enough, there is another company out there named SBLI USA Life Insurance Company. SBLI USA Life Insurance Company, Inc. is not affiliated with the Savings Bank Mutual Life Insurance Company of Massachusetts or the Savings Bank Life Insurance Company of Connecticut.
SBLI Life Insurance Company Ratings
The Savings Bank Mutual Life Insurance Company has some strong ratings. Although not as high as many of its mutual insurance peers, they are solid enough ratings that should put any would be applicants mind at ease.
SBLI Ratings as of May 1, 2018:
- A.M. Best rating: A
- Fitch rating: N/A
- Moody’s Investor Service rating: N/A
- Standard and Poor’s rating: A-
- Comdex Ranking: 75
SBLI Company Products
The Savings Bank Mutual Life Insurance Company focuses primarily on life insurance and annuities.
- Term Life
- Whole Life
- Whole Life for Children
- Fixed Deferred Annuities
- Single Premium Immediate Annuities
SBLI Life Insurance Policies
Many so-called financial gurus will usually extol the virtues of term and bash whole life. However, the entire term life vs whole life insurance argument is a simplistic view of life insurance. Here at I&E, we actually believe in the idea of term life AND whole life insurance.
Benefits of Term Life Insurance
- Lower Premiums Initially
- Income Replacement
- Mortgage Loan Protection
Benefits of Permanent Life Insurance
Among the many advantages of life insurance are:
- Tax Benefits
- Tax Deferred Cash Value Growth
- Tax Free Death Benefit
- Business Continuation and Succession
- Buy Sell Agreements
- Key Man Insurance
- Corporate Incentives
- Executive Bonus (Section 162) Plans
- Non-Qualified Deferred Compensation Plans
- Split Dollar Life Insurance
- Estate Planning
- Estate Preservation
- Legacy Creation
- Wealth Building
- Infinite Banking
SBLI Life Insurance Policies [Plans and Features]
Life insurance policies are issued by The Savings Bank Mutual Life Insurance Company of Massachusetts, The Savings Bank Life Insurance Company of Massachusetts and Centrian Life Insurance in Connecticut.
Term Life Insurance
A term life policy lasts for a specified period of time. Once your term ends, the term policy can be renewed annually, typically with an increased premium, decreasing death benefit, or both.
SBLI typically offers one of the most competitively priced term life insurance policies. The Company’s flagship product is its Guaranteed Level Premium Term. SBLI also offers Yearly Renewable Term Life Insurance, that does pretty much what the name implies, it renews annually, potentially increasing the premiums every year.
SBLI has done well over the last few years due to its Accelerated Underwriting program. Under the Accelerated Underwriting program, applicants applying for SBLI term life ages 18-60 can get up to $500,000 of coverage with a telephone interview, with no in-home visit required. So if you are in the market for term life, consider SBLI as an alternative to traditional life insurance underwriting.
SBLI’s term life offers an accelerated death benefit, child riders and convertible term life insurance riders. The primary value in our estimation of SBLI’s term life insurance is that you can convert the policy to SBLI’s whole life insurance.
Permanent Life Insurance
SBLI offers one type of permanent life insurance, whole life. However, don’t knock SBLI’s lack of variety here. In our opinion, SBLI sees the future and has made a very wise decision focusing primarily on this forgotten asset of the rich and famous.
SBLI Whole Life Insurance
Although SBLI only offers one type of insurance policy, it offers 6 different variations of whole life insurance, including:
- Single Premium Whole Life
- Limited Payment Whole Life 10
- Limited Payment Whole Life 15
- Limited Payment Whole Life 20
- Limited Payment Whole Life Paid-Up At 65
- Continuous Payment Whole Life
We list the 6 different whole life insurance product offerings in order based on how long you would have to make premium payments. A potential disadvantage of a shorter payment time frame is whole life insurance rates will be higher.
However, the benefit is your limited pay whole life policy will be paid-up and you will no longer have to make a premium payment but you will consider to reap the many benefits of whole life insurance.
As a Mutual Whole Life Insurance Company, SBLI’s whole life policies offer several guarantees.
Whole Life Guarantees such as:
- Guaranteed Death Benefit Protection for Life
- Guaranteed Fixed Level Premiums for the Duration of the Policy
- Guaranteed Tax Deferred Cash Value Accumulation and Growth
In addition to these fantastic guarantees, SBLI’s whole life insurance is considered “participating whole life“, which means the policy may also pay annual dividends. And although dividends are not guaranteed, most mutual companies have consistently paid dividends year in and year out for over 100+ years straight.
Life insurance dividends are the heart and soul of whole life and can turn an ordinary whole life policy into an efficient, cash generating machine. And dividends paid to participating policyholders are not taxed, so the dividend can be used in a variety of ways, including:
- Cash out for whatever you choose. Many people use whole life dividends as part of a life insurance retirement plan.
- Leave with the Insurer to earn interest. Earned interest will be taxable.
- Pay down an existing policy loan or loan interest.
- Offset premium payments for a period of time. The longer you have the policy and the more the cash value has increased, the more likely the dividend will completely offset your annual premium.
- Purchase paid-up additions that allow you to buy additional paid-up life insurance that increases your cash value and death benefit.
Whole Life Insurance For Children
SBLI also offers whole life insurance for children. Face amounts range from $10,000 to $1,000,000 and is available for children aged 15 days to 14 years old.
In addition to the benefits of whole life insurance listed above, you can use the policy to provide for your child’s financial future. The cash value can be used to pay for anything your child may need, such as an education, a home, a wedding, travel, etc.
Further, the policy can be used as a great teaching tool on how they can manage their own finances by using life insurance as a personal bank.
Additional Benefits of Whole Life Insurance
Whole life insurance is so much more than simply a death benefit. The following are a few of the benefits of cash value life insurance.
Tax free life insurance policy loans
You can borrow against your life insurance, using your cash value as collateral. You have the option of taking our a loan from the insurance company or you might find better terms from a local bank, increasing your potential for positive arbitrage.
Tax free policy loans also allow you to practice infinite banking. One of the benefits of infinite banking is that you become your own banker and take back control of your finances.
Tax deferred cash value growth
Whole life cash value grows tax deferred. And if you utilize the policy correctly you will never need to pay taxes on the cash value growth.
Tax free death benefit
The death benefit from life insurance is not taxed in most situations. A couple ways it may be taxable is if your estate exceeds the federal estate tax exemption limit, which is $11.2 million in 2018, or your premiums paid into the policy came from pre-taxed dollars. The main point is your beneficiary should get your entire death benefit income tax free.
SBLI Whole Life Insurance Riders
SBLI offers some great whole life insurance riders, such as the following:
Flex-Pay Paid-Up Additions Rider: allows you to make additional payments into your policy to increase the cash value and death benefit.
Level Term Insurance Rider: Adding a term rider to your whole life policy allows you to increase your initial death benefit while you wait for your cash value whole life policy to build, or can be converted to whole life down the road.
Accelerated Death Benefit Rider: the ADB rider allows you to access a portion of the death benefit if you are diagnosed as terminally ill with less than 12 months to live.
Waiver of Premium Rider: the waiver of premium rider will waive premiums due on the policy if you become totally disabled.
Guaranteed Purchase Option Rider: allows the insured to purchase additional life insurance coverage with no evidence of insurability at specific ages or for specific events, such as marriage, buying a home and the birth of a child.
SBLI Life Insurance Review Conclusion
SBLI is a fantastic company, particularly when it comes to its whole life insurance options. But there is no one size fits all company and it pays to shop around for the best carrier and policy for you. For you, the best policy will depend on many variables, including your unique needs, goals and objectives. Give us a call today for a free strategy session and see if SBLI is the right fit for you.