How often to policies get replaced?

[UKTX]

Most policies do not get replaced, some do, but most do not.

And, replacers always get replaced too. If you sell em on price, you will lose them on price as well.

 

[tribetime32]

I have a lot of Lincoln Heritage (LH) Senior Life (SL) American Income Life (AIL) etc. in my area and so I would say that at least 50% of my business is replacements, reduced paid up etc. Additionally, I have never replaced or changed a policy where I didn't believe I was putting the client in a better situation. That's how drastically different the companies an independent agent has to offer.

So many wonderful opportunities out there. I love that there are Senior Life and Lincoln agents running around. Makes my job a lot easier!

 

[Todd King]

Most policies do not get replaced, some do, but most do not.

And, replacers always get replaced too. If you sell em on price, you will lose them on price as well.

Heard this my whole career. It's a bunch of hooey!

My old manager tried to tell me that when he was selling UA (Med Supps) to many of his clients and wanted me too also. I told him then that if he gave me a list of his UA clients that I would replace 90% of the ones that could qualify for another company and give them a better deal as UA was without a doubt the highest company on the market. They gave nothing more to the client than any of the other companies, so they were paying extra for nothing.

I wonder why he never gave me that list? I've replaced many policies (Med Supp & FE) when the situation calls for it. Didn't get replaced on price either...unless I was the one doing it!!

 

[UKTX]

Heard this my whole career. It's a bunch of hooey!

My old manager tried to tell me that when he was selling UA (Med Supps) to many of his clients and wanted me too also. I told him then that if he gave me a list of his UA clients that I would replace 90% of the ones that could qualify for another company and give them a better deal as UA was without a doubt the highest company on the market. They gave nothing more to the client than any of the other companies, so they were paying extra for nothing.

I wonder why he never gave me that list? I've replaced many policies (Med Supp & FE) when the situation calls for it. Didn't get replaced on price either...unless I was the one doing it!!

UA lol. That brings back memories

 

[rousemark]

Heard this my whole career. It's a bunch of hooey!

My old manager tried to tell me that when he was selling UA (Med Supps) to many of his clients and wanted me too also. I told him then that if he gave me a list of his UA clients that I would replace 90% of the ones that could qualify for another company and give them a better deal as UA was without a doubt the highest company on the market. They gave nothing more to the client than any of the other companies, so they were paying extra for nothing.

I wonder why he never gave me that list? I've replaced many policies (Med Supp & FE) when the situation calls for it. Didn't get replaced on price either...unless I was the one doing it!!

But... but... but... They had "Automatic Claims Filing"...... Would you believe they are still printing a flyer promoting their ACF for their agents to use today?

 

[Newby]

Most policies do not get replaced, some do, but most do not.

And, replacers always get replaced too. If you sell em on price, you will lose them on price as well.

Actually you are repeating failed logic that captive managers try to get their agents to buy into.
The truth is: If you sell really high priced policies you are very EASY to replace. And 90% of the agents coming behind you are going to do the family a favor and give them more coverage for the premium they are paying.

The lower the premium you sell them makes it much more difficult for an agent to come behind and replace with any meaningful savings. Lower priced policies are replaced much less often.

These are indisputable facts. No one who has spent any time in the FE field could believe otherwise.

 

[UKTX]

Actually you are repeating failed logic that captive managers try to get their agents to buy into.
The truth is: If you sell really high priced policies you are very EASY to replace. And 90% of the agents coming behind you are going to do the family a favor and give them more coverage for the premium they are paying.

The lower the premium you sell them makes it much more difficult for an agent to come behind and replace with any meaningful savings. Lower priced policies are replaced much less often.

These are indisputable facts. No one who has spent any time in the FE field could believe otherwise.

Until the next agent comes along and sells a lower priced policy.......

I'm not captive, and haven't been for 20 years lol.

If an agents sole purpose is to replace a policy with a lower priced policy, then there is nothing to stop another agent coming right behind them and doing the same thing.

There is always a cheaper policy out there......granted it does get more difficult, but there will always be some third rate carrier being peddled by a newby offering a super low rate (normally clean sheeted as well)

 

[FETalk]

Nor should they. There are far too many agents trying to make a living by flipping people, IMO. Oh, sure it can be "justified". Doesn't always make it right.

I'm not saying an agent should never replace. On a rare occasion, I might. If it's a brand new, or fairly recent (months not years) issue policy, I might replace. If it's graded and I can get immediate benefit I will replace. But I will NOT replace a whole life policy outside of contestability, unless circumstances warrant (for example, a policy that's about to lapse due to overloan).

This is on my mind right now because I'm trying to keep a client from making a replacement mistake. She's 78 years old, has been my client for 10 years, and is one of my favorite people in all the world!

Well, the other day Agent "Twit" (who's had his license all of 2 days) came knocking on her door and happened to catch her when she was worrying about how to pay for an expensive home repair. He apparently picked up on that, because somehow they had a conversation about getting her some cash through surrendering old policies. (I don't fault Mr. "Twit" for doing that. He's just following his training.)

Here's the deal, though. I happen to know that her health is worse than she believes it to be. I know this because we tried to write additional coverage for her last year. She was declined because of a prescription for a condition she didn't realize she had, so she had answered "no" to a question that should have been "yes".

But what would have happened if that prescription had not shown up? She'd have a small policy now still in the contestable period, plus a much greater amount of coverage that's far past contestability. If she died right now, the last policy wouldn't pay, but the older policies would.

Now, what if I'd replaced all of those policies (like "Twit" is attempting)? She could have gotten a few hundred dollars out of the surrenders, which would have "justified" the replacement. BUT - If she died right now, her family would only get the refund & interest for the year's worth of premiums, rather than the full benefit of the policies she had paid into over many years!

Mr. "Twit" didn't write it with a "know before you go" carrier, so if they check MIB it will likely be declined, anyway. But what if they don't, and she gets a BRAND NEW, SHINY policy? What happens if she dies in the next few months (which is a very real possibility)? Has Mr. "Twit" really acted in her best interest?

(Sorry for the rant. Feeling kind of strongly about this right now!)

If you're client has had a policy with you for 10 years, then this agent should definitely not have attempted to replace it.

I don't think it has anything to do with "training" though, but rather, it just sounds like this guy is a "bad apple"; as i can't imagine any agency/FMO/IMO etc. training their agents to engage in such a practice.

What I'm curious to know, is how would he even able to compete (price-wise) with a policy that's 10 years old?

That being said, If it was me, I wouldn't let him get away with that. I would definitely report him.

 

[Newby]

Until the next agent comes along and sells a lower priced policy.......

I'm not captive, and haven't been for 20 years lol.

If an agents sole purpose is to replace a policy with a lower priced policy, then there is nothing to stop another agent coming right behind them and doing the same thing.

There is always a cheaper policy out there......granted it does get more difficult, but there will always be some third rate carrier being peddled by a newby offering a super low rate (normally clean sheeted as well)

If the agent left the door wide open that HIS rate can be easily beat by enough that it's worth the extra savings then yes, he could be replaced again. That has not been my experience nor the experience of any skilled FE agent that I know of.

Now I have ran across agents replacing by clean sheeting and often lying on smoking. Those guys are scumbags and I will hang them as often as I can. But those guys are not the norm and they won't last long in the biz.

Any agent replacing a policy needs to be extra careful on his underwriting to make certain that he isn't going to getting ulcers if the person dies in the first two years.

I was in the field for 20 years. And it was COMMON for me to replace coverage. If they had the wrong type of insurance or had been clean sheeted or had a whole-life that was priced too high or had a waiting period, I'm going to show them their more attractive options just like I would hope someone would do for my mom. And I have RARELY had a contestible claim that did not go well. And never on a replacement policy.

Replacing policies is not a bad thing to do. IF it's to the advantage of the applicant AND if they cleanly qualify for what you are selling them. And you can come behind and try to replace mine all you want. You will have a really hard time if I did my job properly.

 

[rousemark]

If you're client has had a policy with you for 10 years, then this agent should definitely not have attempted to replace it.

I don't think it has anything to do with "training" though, but rather, it just sounds like this guy is a "bad apple"; as i can't imagine any agency/FMO/IMO etc. training their agents to engage in such a practice.

What I'm curious to know, is how would he even able to compete (price-wise) with a policy that's 10 years old?

That being said, If it was me, I wouldn't let him get away with that. I would definitely report him.

Believe me, there are agencies that train their agents to be replacement artist from the beginning. He can't compete with the old plan, it is the cash in hand that is the draw. I have seen people double the premium they are paying in order to get $500-$600 cash in their pocket from the cash value of the old policy. If you will read through the forums you find posts of agents in this forum that brag about doing the same thing as "Twit"..