First of all - we need a Term Insurance sub-forum . . .

[WinoBlues]

agreed, separate policies for everyone, another reason is they can lapse one if money gets tight and keep the breadwinner. And, I always use MOO for kids policies.

I write MOO on kids as well. However, I always, ok, mostly, recommend a child rider for young females or couples also. The automatic coverage at 15 days of life and conversion options can be a huge deal. And the premium difference is what $10.?

Edit: ok, i should have read forward - what Allen Trent said.

 

[WinoBlues]

Return of Premium Term -

Another over looked product that can many applications. IMohsoHO

 

[myinsurebiz]

Return of Premium Term -

Another over looked product that can many applications. IMohsoHO

I studied ROP hard today. I will lead with that via Assurity with other riders too.

But - after listening to everyone - I won't be doing any Spouse riders or other insured riders. Except for the policy fee - not much difference in rates and it's usually cheaper on the Female.

 

[WinoBlues]

If they can afford stand alone kids WL policies without sacrificing coverage on parents, great. That would be best option. But, normally you can't buy stand alone term poicies for kids under age 18 or so.

If they have limited funds & can't afford WL or all their current & future kids or they have 2,3 or say 6 kids, adding the Child Rider is great as it is a small flat charge. It usually covers all current living kids that are insurable & all future children born or adopted without underwriting.

So, the more kids in a family, the better deal the flat child rider costs. All these features along with the fact that many child riders allow conversion to WL up to 5x the rider amount at age 20-25 make the Child Rider a great way to provide inexpensive coverage & some guaranteed future WL insurability. A 20k child rider would many times allow them to convert to 100k WL when they are 20-25 yrs old.

In our race to be cheapest in term, too many agents fail to add the child rider as it adds more paperwork, longer phone interviews & adds very little premium & commission. Same can be said for Disability Premium waiver rider that is not sold nearly enough any longer.

Commissions - Seems short sighted. A month or so ago I converted the last of 5 child riders off of a policy I wrote over 15 years ago. That is five new adult cases added to my book. Plus an additional one on mom. . In today's mail I got the child rider conversion letter on another. I will only make a few hundred dollars on this deal. However, The kids all range from 25 to 35 years old. They are all married with children. Their parents, my clients are my clients with a term policy about to term out. Zip code 94505. While some agents see a hassle for very little I see inventory. The parents started out as orphan term deals about 18 years ago. The referrals alone from these people have been valuable.

 

[myinsurebiz]

Commissions - Seems short sighted. A month or so ago I converted the last of 5 child riders off of a policy I wrote over 15 years ago. That is five new adult cases added to my book. Plus an additional one on mom. . In today's mail I got the child rider conversion letter on another. I will only make a few hundred dollars on this deal. However, The kids all range from 25 to 35 years old. They are all married with children. Their parents, my clients are my clients with a term policy about to term out. Zip code 94505. While some agents see a hassle for very little I see inventory. The parents started out as orphan term deals about 18 years ago. The referrals alone from these people have been valuable.

Nice.

Curious - I haven't been around long enough for any conversions. How does that work? Say they want to convert to a $50k WL - are normal commissions paid on these deals?

Seems like a way to keep the client and family as clients for life . . .

 

[WinoBlues]

Nice.

Curious - I haven't been around long enough for any conversions. How does that work? Say they want to convert to a $50k WL - are normal commissions paid on these deals?

Seems like a way to keep the client and family as clients for life . . .

Depends on the company. But many if not most times yes. I Just converted an Assurity term plan to their Par WL and I got full comp. Maybe with the exception of the term conversion credit. Super easy. A couple of signatures and done.

 

[johntrice]

Guys, I agree with what has been said about the living benefit riders, but there's something to consider... human nature. I agree that if a client buys a life plan and a critical illness stand alone perhaps with a off the job disability, that would be ideal; however, we're dealing with people and unless we are very proactive in our care of our clients, many will forget to pay several different premiums.

The absolute best overall strategy is having the living benefits like critical illness on payroll deduction and a true pure life at home but we rarely have that option. That's why I like fully underwritten life with living benefits. One premium, one plan and the clients can understand it. I do agree that the insurance carriers should be more transparent about the acceleration of the death benefit. I also agree that living benefits greatly diminish the death benefit, but since the plan is often sold for mortgage protection, bumping up the face amount can help quite a bit. We can always check our pricing bands and often keep the policy affordable.

One last thing about Return of Premium options, I love them and hate'em.

ROP is pretty good if the owner keeps the policy for the entire term period; however, many plans return nothing (or very little) if the policy isn't kept to termination. Since most term plans are canceled before the end of the term and many clients forget that they have this rider, clients can really mess up. One family canceled their plan two years before the expiration of the initial term period since they had paid off the home. They lost all the accumulated premiums.

Also, when money gets tight, ROP plans are generally much more expensive than simple term. American National has a pretty good GUL that has ROP in the twentieth year. It's a good planning tool if homeowners what to payoff a home early and they can see cash value reports annually.

If you have a super sharp client and you do annual reviews, sell term and critical illness/disability separately. If your clients are working middle class families and you're a once and done agent, then sell the bundled product. .

One last thing on kids plans, don't forget things like the Million Dollar Baby strategy. LSW has a great presentation on that idea; however, you have to sell an LSW plan on the parents or the kids can't have their plan.

 

[myinsurebiz]

Depends on the company. But many if not most times yes. I Just converted an Assurity term plan to their Par WL and I got full comp. Maybe with the exception of the term conversion credit. Super easy. A couple of signatures and done.

I'm looking forward to the day.

Another question - for my family to carry on when I die - say there is a 30 year ROP. Client is going to receive say $20k in returned premium. With Assurity - can they elect a RPU whole life instead? If so - does the agent earn off that?

 

[myinsurebiz]

Guys, I agree with what has been said about the living benefit riders, but there's something to consider... human nature. I agree that if a client buys a life plan and a critical illness stand alone perhaps with a off the job disability, that would be ideal; however, we're dealing with people and unless we are very proactive in our care of our clients, many will forget to pay several different premiums.

The absolute best overall strategy is having the living benefits like critical illness on payroll deduction and a true pure life at home but we rarely have that option. That's why I like fully underwritten life with living benefits. One premium, one plan and the clients can understand it. I do agree that the insurance carriers should be more transparent about the acceleration of the death benefit. I also agree that living benefits greatly diminish the death benefit, but since the plan is often sold for mortgage protection, bumping up the face amount can help quite a bit. We can always check our pricing bands and often keep the policy affordable.

One last thing about Return of Premium options, I love them and hate'em.

ROP is pretty good if the owner keeps the policy for the entire term period; however, many plans return nothing (or very little) if the policy isn't kept to termination. Since most term plans are canceled before the end of the term and many clients forget that they have this rider, clients can really mess up. One family canceled their plan two years before the expiration of the initial term period since they had paid off the home. They lost all the accumulated premiums.

Also, when money gets tight, ROP plans are generally much more expensive than simple term. American National has a pretty good GUL that has ROP in the twentieth year. It's a good planning tool if homeowners what to payoff a home early and they can see cash value reports annually.

If you have a super sharp client and you do annual reviews, sell term and critical illness/disability separately. If your clients are working middle class families and you're a once and done agent, then sell the bundled product. .

One last thing on kids plans, don't forget things like the Million Dollar Baby strategy. LSW has a great presentation on that idea; however, you have to sell an LSW plan on the parents or the kids can't have their plan.

Lots of great info John - thanks!

 

[myinsurebiz]

One last thing on kids plans, don't forget things like the Million Dollar Baby strategy. LSW has a great presentation on that idea; however, you have to sell an LSW plan on the parents or the kids can't have their plan.

Very interesting - Good stuff John.

http://www.seniorbenefitscenter.inf...8889/million_dollar_baby_iul_presentation.pdf