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Among other objectives, the NAIC said the illustration must be "understandable to all parties involved in the sale of health insurance." The National Association of Insurance Commissioners (NAIC), in its December 1996 promulgation of Model Regulations for health insurance policy illustrations, defined the purpose of an illustration as "clearly disclosing how the policy being illustrated will work, distinguishing that which is guaranteed and that which is not." However, illustrations have little value in predicting actual performance or in comparing products and companies sales illustrations are usually designed to present potential benefits and costs under a set of non-guaranteed assumptions more optimistic than the guarantees and the risks associated with the possible inability of a product to achieve the higher illustrated benefits, or lower illustrated costs, than those. In the Society of Financial Service Professionals' groundbreaking Illustration Questionnaire introduced in 1992, the introduction states, in part: The sales illustrations are useful in developing the best combination of policy specifications to achieve the buyer's objective. The Society of Financial Service Professionals attempted to help agents, insurers, and their customers break the code of arcane insurance language and the assumptions underlying the production of a policy illustration. One intriguing issue of computer-generated policy illustrations is that, when premiums or cash values are presented as a precise number (e.g., $7,178), the seeming accuracy of such a calculation has a subtle but powerful effect on most consumers: it's easy to automatically assume that the precisely calculated numbers are themselves accurate. A Variable Universal Life policy - assuming 10 percent average long-term investment returns in all-equity subaccounts - could be funded for as little as; $7,178.

Using current assumptions of a 5 percent crediting rate and the currently assumed scale of future Cost of Insurance, a regular Universal Life calculation of funding premium is $10,400. Then there's the calculation of "premiums" for those policy types that have no premiums. With equal guarantees of sufficiency, a representative No Lapse/Secondary Guarantee Universal Life premium is $8,041; the difference between these two guaranteed policies is the strong likelihood that the latter will develop no accessible cash surrender value beyond the 15th year of ownership. To keep it simple, we'll use the non-par Whole Life premium of $15,255 as our benchmark for a fully sufficient, guaranteed premium paid on behalf of a $1 million policy. Were it issued by a mutual carrier, the premium might be slightly higher (a representative premium for a dividend-paying policy is $18,810); the higher premium is justified by a historic ability to enhance policy values and benefits through the payment of dividends (or to offer cash refunds that allow for a lower net policy premium).