I sat down with an insurance representitive today and listened to their proposal regarding Cash Value Life Insurance (CVLI) and long term investing. I am a 36 year old guy recently married with no children yet. Since I recently got married, I wanted to start researching life insurance and investments that will benefit myself and family for long term planning. What is your opinion on investing in CVLI? The only investing I currently do are in my companies 401K plan (maxing out the contribution at $17K per year). I cannot contribute to Roth IRA due to my income level.
I am of the strong opinion that life insurance should be purchased as a term product and nothing more. The internal expense is usually high, the returns, poor and the product disclosure is often incomprehensible. The only purpose Cash Value Life Insurance serves, in my opinion, is to fund the retirement and college educations of those selling it.
I have an answer and a few comments.
Back to the basics: Insurance is purchased to provide protection in case of a loss.
It sounds as though you are doing well, from a financial perspective. If you have $0 of financial obligations (loans, mortgages, credit cards, etc.) and you are comfortable with the amount that would be passed on to your heirs, then you DO NOT NEED LIFE INSURANCE.
Life insurance is PROTECTION for your heirs so that they can pay off debts and pay for necessities, if you are the "bread-winner" and your assets won't be enough. That's all.
Life insurance should never be viewed as an investment vehicle. Some policies allow you to invest in funds of your choosing, but the fees charged by the insurance company are usually high. Higher than you might find elsewhere.
To answer your other question: I think NY Life is a great life insurance company. They are a mutual company, which is better in my opinion than a stock company because they are okay with holding extra capital. This means they are more likely to have the money to pay all of their claims in a specific period, which shows in their ratings: http://www.newyorklife.com/about/what-rating-agencies-say Whereas public companies will yield a lower return to their stock holders if they are just sitting on additional capital and not paying it back to their stock holders.
Almost everyone needs an insurance, you should also probably buy it. If you are good at planning [which it seems from your question], you should stick to Pure "Term" insurance and avoid any other types / variants of CVLI.
CVLI is only advisable if one cannot commit to investing or is not good at saving money, or one feels that one loses money in Term Insurance.
Otherwise term insurance is best.