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7 pay test explained for life insurance

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7 Pay Test Explained for Life Insurance

In today's Better Wealth Breakdown, Dan and I reflect back to our last episode where we spoke on the MEC - Modified Endowment Contract and now we discuss part 2 which is the 7-Pay test. As defined the 7-pay test determines whether the total amount of premiums paid into a life insurance policy within the first 7 years is more than what was required to have the policy considered paid up in 7 years, policies become MECs when the premiums paid to the policy are more that what was needed to be paid then the 7-year time frame. It’s clear as mud!!! Listen as Dan and I break down this definition and how policies can be created to be efficient using the 7-pay test.

#BetterWealth #7PayTest #MEC


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