FE Whole Life Cash Values

[0b1kanobee]

I'm looking at an illustration with American Amicable which shows the age, year, GDB (guaranteed death benefit) , annual premium and GCV (Guaranteed cash value).

Looking at year 10 for instance, it says the GCV is $1,549.80

1) Now what exactly does this mean?

2) What does it do for the client? How can it serve them?

3) What are the negative affects (if any) of using what I'm going to call a resource for lack of a better word (since I'm looking at it as a resource). Feel free to correct me where I may be wrong. If it isn't a resource, what is it? Is it like having money in the bank? Can it be tapped into? Must it be in the form of a loan?

Can anyone answer these questions in order? I'm sure it is fairly simple for you seasoned guys.


ALSO......do any of you who sell these small face value FE policies show the cash value accumulation or do you tend to keep it simple unless asked?

 

[jdeasy]

I'm looking at an illustration with American Amicable which shows the age, year, GDB (guaranteed death benefit) , annual premium and GCV (Guaranteed cash value).

Looking at year 10 for instance, it says the GCV is $1,549.80

1) Now what exactly does this mean?

2) What does it do for the client? How can it serve them?

3) What are the negative affects (if any) of using what I'm going to call a resource for lack of a better word (since I'm looking at it as a resource). Feel free to correct me where I may be wrong. If it isn't a resource, what is it? Is it like having money in the bank? Can it be tapped into? Must it be in the form of a loan?

Can anyone answer these questions in order? I'm sure it is fairly simple for you seasoned guys.


ALSO......do any of you who sell these small face value FE policies show the cash value accumulation or do you tend to keep it simple unless asked?

1. It's exactly what it says it is, guaranteed cash value.

2. For the client, they can borrow against it. They can surrender the policy and receive the cash. They can use it to pay the premiums if they get in a rough spot and can't pay make their payments.

3. The negative is that, if they borrow against it and pass away before they repay it, the death benefit is reduced. If they surrender the policy to get the cash value, they no longer have the life insurance.

As for showing the cash value to clients, I don't unless they specifically ask for a breakdown. That happens maybe once or twice a year.

 

[BNTRS]

Also to hammer the point, guaranteed means at least that much. If this is par WL, then with dividends it could be more.

 

[VolAgent]

I seriously doubt anyone is buying FE WL for the cash value. They are buying it for the guaranteed death benefit. Find out what is important and focus on that.

 

[jdeasy]

I seriously doubt anyone is buying FE WL for the cash value. They are buying it for the guaranteed death benefit. Find out what is important and focus on that.

That's right and that's why it very seldom comes up. If they are buying it for the cash values, they are buying it for the wrong reason, in my opinion anyway.

 

[0b1kanobee]

I was just looking for an explanation without getting too technical and you guys have it explained it to me well, thank you.

I have another policy I sold a few months back and the client is wanting me to explain it since his wife's WL pays dividends.

I'm getting ready to write this along with a fairly large term so as a last resort I may bring it up since the client is fascinated with WOP. Good to know they can borrow against it to pay the premium if they had to.

What's important to them is getting coverage that they were told they could not I guess by another agent. Oh and the WOP. Love that WOP these folks do. Being able to borrow against the cash value negates having a WOP which I don't think you can have on this product.

 

[WinoBlues]

What they said. It is good to know this stuff. but do not talk your self out of the door. Get ink on paper.
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I was just looking for an explanation without getting too technical and you guys have it explained it to me well, thank you.

I have another policy I sold a few months back and the client is wanting me to explain it since his wife's WL pays dividends.

I'm getting ready to write this along with a fairly large term so as a last resort I may bring it up since the client is fascinated with WOP. Good to know they can borrow against it to pay the premium if they had to.

What's important to them is getting coverage that they were told they could not I guess by another agent. Oh and the WOP. Love that WOP these folks do. Being able to borrow against the cash value negates having a WOP which I don't think you can have on this product.

OK, different issue. If she has an old mutual Whole Life you had better have a nice FE to compete. RNA (per JD) may be it. But, it is rare that I cannot beat a FE policy with a underwritten policy if they are healthy.

 

[0b1kanobee]

What they said. It is good to know this stuff. but do not talk your self out of the door. Get ink on paper.

I have done that a few times.

I'm gonna go a little out of my comfort zone on this sale. I'm going to ask for referrals (hopefully walk out with a list) and I'm gonna visit the neighbors on the sides and across the street. See if I can't pick up an extra policy or two while I'm in the 'hood'.

WINO, his wife's policy is like 25 years old. He just wants to understand that it builds cash value (possibly) and 'might' pay dividends. It is a CSA policy. First FE policy I ever sold. Todd King helped me close the guy over the phone because he was adamant about NOT doing a bank draft. Thankfully Todd and I worked it pretty good on speaker phone. He wasn't going to buy until he heard Todd on the other end and then walked to get his checkbook. It was a beautiful thing.

 

[WinoBlues]

I have done that a few times.

I'm gonna go a little out of my comfort zone on this sale. I'm going to ask for referrals (hopefully walk out with a list) and I'm gonna visit the neighbors on the sides and across the street. See if I can't pick up an extra policy or two while I'm in the 'hood'.

Ask them if they would mind if you contacted the Beneficiary(s) just to introduce yourself. In case something happens, they know who to call. Take note as to who they are, kids, work, health etc... In "the hood" I like to also leave magnate cards. I see my old ones on the refers all the time. From time to time I get a call from someone that got it from a family member. Just a thought.

 

[0b1kanobee]

Ask them if they would mind if you contacted the Beneficiary(s) just to introduce yourself. In case something happens, they know who to call. Take note as to who they are, kids, work, health etc... In "the hood" I like to also leave magnate cards. I see my old ones on the refers all the time. From time to time I get a call from someone that got it from a family member. Just a thought.

Thank you. I was thinking about getting some door hangers to leave at the not at homes but I have heard on not so good success with these. I would like to anyway and then come back and do a follow up with the not at homes.

I have realized I'm missing the boat by not getting referrals like I should be. I need to stay in contact better with existing clients as well. Stay fresh in their mind so to speak.

We go on our first med sup appointment Monday (mine anyway not the other agent) so I'm excited about that as well. Going from 900 bucks a month to 280. I should find some money there for cross sales. Maybe an annuity!

You just gave me an idea. My buddy has sold quite a few terms, a couple of hundred. I need to contact those beneficiaries. He's letting me help him with his book as he plans on retiring and handing it over to me.