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Katt & Company is a national fee-only life insurance advising firm. The June 2002 Forbes magazine, and a July 16, 2003 Wall Street Journal article, name Peter Katt as one of only four nationally recognized advisors. The Forbes article states that, "…advisers are well worth the money… These savants are working for no one but you…" For references please contact us. ILIT Policy Management I was retained by an ILIT in 1998 to untangle a confusing web of misinformation provided by several competing agents trying to replace the three existing policies. The ILIT was vulnerable to misinformation because there had been no policy management since they were purchased in 1988 with the promise of short premium payment periods (so-called vanishing premium policies). As dividend rates went lower the number of premiums needed substantially increased, and this caused agents to recommend the policies be replaced, but this didn't mean the policies should be replaced. In fact, the three companies are excellent with exceptional policy values. I redesigned the policies away from limited premiums. An annual global gifting budget was established. Two policies were set up with the minimum annual premiums to maintain level benefits, with the remaining budgeted amount paid into an increasing death benefit whole life. As dividend values have come down even more the amounts needed to maintain the two with level death benefits have gone up and the amount paid to the increasing death benefit policy has come down. This is an annual exercise in management. Interest rates and the overall investment environment have a direct impact on dividend and interest crediting rates. Level death benefit policies' premiums need to be adjusted as rates swing. Increasing death benefit policies' premiums probably won't change but it is a good idea to report on actual cash value and death benefit results in order to manage the ILITs expectations. All policies should be reviewed and managed. For the sake of trustee liability, this is especially true for ILITs.
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