What is a key function of life insurance illustrations?

Life insurance illustrations serve an essential role in helping both agents and clients understand the intricate details of life insurance products. The primary function is to provide comparisons among different policies, showcasing various features, benefits, and projected performance over time. This allows consumers to make informed decisions based on their specific needs, preferences, and financial situations.

By presenting scenarios related to premium payments, cash value accumulation, death benefits, and optional riders, these illustrations enable potential policyholders to compare how different products align with their long-term financial goals. The clarity gained through these comparisons can significantly influence a client's choice of policy, making this role of illustrations crucial in the insurance buying process.

While life insurance illustrations can also serve other secondary functions—such as educating agents about policy performance—this is not their primary purpose. They are not intended to increase premiums or serve as binding contracts; rather, they are tools for clarity and comparison. Thus, the responsibility of providing side-by-side evaluations of policies fundamentally underscores the significance of illustrations in the life insurance industry.