Another Reason to Buy FE

[rousemark]

When I started with a NL&A we were still selling industrial insurance, small policies that were issued in amounts up to $1500 that had a sight draft attached. Sold quite a few to clients that normally would not be considered FE prospects because they made a good income and had plenty of "life" insurance. The presntation and reasoning still works today for FE sales.

"Mr. Jones, I know you have provided good life insurance coverage for your family and you are to be commended for that. But, when death occurs, the first thing the funeral home is going to ask for is either cash or an insurance policy to pay the bill.

You don't want Mrs. Jones to have to take a $500,000 policy and assign the benefits to the funeral home. This burial insurance plan is enough to pay for the average funeral.. She can take this policy to the funeral home and they will not know how much coverage you had elsewhere. it is none of their business anyway and they won't be tempted to oversell your family simply because they know how much money is available. Plus ALL the money from your other policy is still available to do what you wanted it to do for your family"

The next time someone tells you they have plenty of "life" insurance, try telling them, "That's great! And, I want to congratulate you for making sure your family is taken care of.. But a lot of people choose to supplement their "LIFE" insurance with "BURIAL" insurance.. let me show you why this makes sense to them."

 

[Justin Bilyj]

Dont forget about the average time it takes for an average life policy to be paid out...

 

[Fisher]

Dont forget about the average time it takes for an average life policy to be paid out...

Which is what?
.....

 

[0b1kanobee]

GOOD STUFF!! I'll have to keep this in mind when I run across these prospects.

 

[Guest]

You don't want Mrs. Jones to have to take a $500,000 policy and assign the benefits to the funeral home.

Teach me something here.

You are saying that the surviving beneficiary can take a $500K policy to the funeral home, lay it on the desk, and use it as collateral for a $20,000 funeral? I didn't know that.

I don't understand how the funeral home would collect. Are they made a beneficiary.... after death of the insured? Really?

Is the carrier going to write a $500K check to the funeral home, and the funeral home will take their cut and pay the rest to the beneficiary? What surviving spouse would "trust" the funeral home? (Not mine!)

If you pledge your house as collateral or some stocks, there is legal recourse to obtain them in case of default. But a life insurance policy? I never knew that.

It seems to me that all the funeral home could do is take the promissory note to court and hope for a judgement... but if the wife has left the state or country... or spent all the money (perhaps settling with other creditors) I would think the funeral home would be screwed.

Please explain how the funeral home indemnifies themselves by accepting a life policy as collateral for a nice funeral?

Thanks for the help.

 

[rousemark]

Teach me something here.

You are saying that the surviving beneficiary can take a $500K policy to the funeral home, lay it on the desk, and use it as collateral for a $20,000 funeral? I didn't know that.

I don't understand how the funeral home would collect. Are they made a beneficiary.... after death of the insured? Really?

Is the carrier going to write a $500K check to the funeral home, and the funeral home will take their cut and pay the rest to the beneficiary? What surviving spouse would "trust" the funeral home? (Not mine!)

If you pledge your house as collateral or some stocks, there is legal recourse to obtain them in case of default. But a life insurance policy? I never knew that.

It seems to me that all the funeral home could do is take the promissory note to court and hope for a judgement... but if the wife has left the state or country... or spent all the money (perhaps settling with other creditors) I would think the funeral home would be screwed.

Please explain how the funeral home indemnifies themselves by accepting a life policy as collateral for a nice funeral?

Thanks for the help.

A benefit assignment form is signed by the beneficiary to assign proceeds to the funeral home "as their interests may appear". The company will then pay direct to the funeral home the amount of their claim and pay the remaining proceeds to the beneficiary.

Funeral Homes are kind of persnickety when it comes to getting their money up front.. it is hard to collect after the body is in the ground or cremated.

 

[Guest]

A benefit assignment form is signed by the beneficiary to assign proceeds to the funeral home "as their interests may appear". The company will then pay direct to the funeral home the amount of their claim and pay the remaining proceeds to the beneficiary.

Well, there you go. You learn something new every day. I've never had a client die and while I've read the various settlement options as written in the policies, I've not come across (nor did I know about) this "benefit assignment" option.

Thanks.

One followup question. If Mrs. Jones can easily and safely assign say $15,000 of her dead husband's $500K policy to the funeral home, explain again why she should bother to get MORE insurance for the funeral? Where is the need?

 

[VolAgent]

Well, there you go. You learn something new every day. I've never had a client die and while I've read the various settlement options as written in the policies, I've not come across (nor did I know about) this "benefit assignment" option.

Thanks.

One followup question. If Mrs. Jones can easily and safely assign say $15,000 of her dead husband's $500K policy to the funeral home, explain again why she should bother to get MORE insurance for the funeral? Where is the need?

You think Mr. Jones is going to have a $15,000 funeral when he had a $500K policy, or might the funeral home help Mrs. Jones decide that he needed a $30,000 or even $50,000 or more funeral? After all, she really loved him, and he needs to go out in style.

 

[0b1kanobee]

A benefit assignment form is signed by the beneficiary to assign proceeds to the funeral home "as their interests may appear". The company will then pay direct to the funeral home the amount of their claim and pay the remaining proceeds to the beneficiary.

Funeral Homes are kind of persnickety when it comes to getting their money up front.. it is hard to collect after the body is in the ground or cremated.

Also, there are a few companies who for a fee, will 'front' the money from life insurance policy to the funeral home. Who pays the fee I don't know. I do however think the process is faster and more appealing to the funeral home because another entity is taking the risk and not the funeral home and the funeral home gets paid faster (I think).

Newbie is the expert on it. I posted the link for the company who does this on another thread. Don't remember now though. Again, Newbie knows a lot more about it naturally.

There is a funeral home here in my town, the primary one (several locations..........NOT SCI) who does not take assignment of insurance. CASH OR CREDIT CARD ONLY In this case, the customer would have to use that third party and somebody pays a fee or percentage.
- - - - - - - - - - - - - - - - - -

You think Mr. Jones is going to have a $15,000 funeral when he had a $500K policy, or might the funeral home help Mrs. Jones decide that he needed a $30,000 or even $50,000 or more funeral? After all, she really loved him, and he needs to go out in style.

Depends. In Florida, traditional funerals are few. If you can get a "service" you are lucky. One funeral home owner I know does over 1,000 lives per year. 90% are cremation only. His theory and for some in the industry is that the closer you live to the ocean, the higher the cremation rate without much more. Folks near the coast are more of a transplant and their roots are somewhere else and lots of times their families are too. The more you go away from the ocean, the cremation rate goes down and all other services go up percentage wise no matter whether it can be afforded or not.

 

[rousemark]

Well, there you go. You learn something new every day. I've never had a client die and while I've read the various settlement options as written in the policies, I've not come across (nor did I know about) this "benefit assignment" option.

Thanks.

One followup question. If Mrs. Jones can easily and safely assign say $15,000 of her dead husband's $500K policy to the funeral home, explain again why she should bother to get MORE insurance for the funeral? Where is the need?

As VOLAGENT points out, it helps to keep the family from overspending during an emotional time. Notice the presentation also appeals to the client's sense of privacy, keeping the family business in the family.

As far as the appeal of burial insurance, especially in the south, FE agents and payroll agents would do well to read anything by or about Howard Catchings. MDRT Court of the Table for 25 years and the Top of the Table for 17 years selling primarily "burial" insurance. " If you say 'burial insurance' to a prospect, they say, 'Come in.' If you say 'life insurance,' they say, 'I have enough.'"

Here is a 2006 article about him
Tapping a Basic Need In All Walks of Life | LifeHealthPro
I had the pleasure of knowing him way back when, when he was building his agency. Super, nice gentleman.