Life Insurance and taxes

[Guest]

(2) comparatively low mandated limits on agent commissions. .

Curious. What are those limits? Are they public knowledge and posted somewhere? I looked here but didn't see anything: http://www.ins.state.ny.us/

Al

 

[somarco]

55% on permanent life insurance unless it has changed. Carriers are also prohibited from writing net contracts (no commission).

 

[Guest]

55% on permanent life insurance unless it has changed. Carriers are also prohibited from writing net contracts (no commission).

Any idea what it is on health coverage? I'm looking at getting licensed in NY as I have family there. (Grew up in Great Neck, class of '65.)

Al

 

[NHB_MMA]

War time exclusion? what the heck is that?

I. What exactly constitutes the war time exclusion.

1. Does this refer to being an active combatant. Specifically, serving in the armed forces of the U.S.
2. How about if one is the victim of an act of war. For Example, some muslim terrorist does a September 11 deed on our country once again. Would the victims life insurance pay the claim?

The victims of September 11th were murder victims, which insurance would pay for, barring any of the usual suspect circumstances, which did not apply to 9/11. Here in the U.S., we're not used to seeing military action on our soil. Would an insurance company pay if the Chinese invaded and killed some of our citizens? I would imagine yes, although it might be possible for some policy to include in an exclusion. It's not a situation that has arisen here.

The wartime exclusion refers to those that serve in our armed forces. A Status exclusion applies to anyone serving, regardless of the cause of death and I don't believe it is very common. In other words, a soldier is on leave and visiting friends and family and a rock falls out of the sky and kills him. The insurance company will not pay because he is in the military. Again, I don't think that this is a very common exclusion. A Results exclusion means a soldier gets killed from combat or a training exercise and the insurance company will not pay, but they would pay for a death while on leave or death by illness, assuming it is not military related. From what I've heard, unless the industry has changed, this latter type of exclusion is almost universal in life insurance policies, but I was simply pointing out NYL policies don't have it.

I just read my life insurance policy. Found out that if dissabled because of an act of war, declared or undeclared, one is not covered. It does not matter if one is a combatant (in the armed forces of the U.S.) or a non-combatant (a civilian, a victim).

Kind of ticks me off. My Agent told me that the rider would pay if one were ever dissabled for any reason. Actually he said if one could not work for any reason. That is the problem, by the time you learn enough to know the right questions to ask, it is too late.

Interesting. I know death benefits were paid out for 9/11. I'll have to ask about the waiver of premium issues. These are all questions that don't impact 9 out of 10 policies, but they're important to some people. It just shows that not all insurance policies are the same and the dangers of buying without knowing what you're buying. I don't care so much about captive or indy. I have known good and bad in both, but it just shows that a good agent should explain most anything that could possibly ever effect you or be of concern. There is a hell of a lot more to buying insurance than simply grabbing the absolute cheapest thing out there and I think the most important thing is having someone you trust that knows his stuff explain everything to you.

I read my policy cover to cover. There is no mention about not paying off if death was caused by war. Would the policy have to specifically state it if were to be an exclusion? The only provision where they will not pay is for suicide, whether sane or insane within two years of purchasing the policy.

Probably. I would think if it doesn't state it, it would have to pay. However, maybe they would argue that such an exclusion is so common it should be assumed that it would not be paid, but I doubt it. State Farm is a great company that offers wonderful products. The only thing makes me wonder is it is almost universal for policies to have a provision saying they will not pay if you die while committing a crime. So, if you rob a bank and get gunned down by the police, they're not paying. I would be surprised if State Farm does not also have that policy.

 

[NHB_MMA]

Re: First Call Close

Correct - they don't teach the "first call close" during training, they have the idealized Financial Needs Analysis but as Petrowski mentioned if you aren't pushing for quick closes you'll be taking that "walk of shame" pretty quickly. There's a monumental disconnect between training and the true day to day selling style of the agency.

Well, I think anyone that doesn't try to grab the business in a relatively short span of time will be out of business shortly. Of course they're going to teach you to get the information, work on the recommendations and set a closing appointment within a few days. And no matter what they teach you, you will have some clients that will put you off and insist on doing something "maybe in a couple months". If you don't try to get the business ASAP under normal circumstances, not in complex estate issues for example, you will not get the business 98% of the time. I mean, there is a reason why people are reluctant to deal with salesmen. There is a reason why people that are extremely good at this job make massive incomes...because it's a hard job for the average person to do and they have to pay a person fairly well to do it. I have made it a goal to try and be one of the most pleasant to deal with agents there can possibly be, yet if no one was ever the least bit "pushy" there would be a society full of widows left with no death benefits, people filing bankruptcy due no medical coverage, nursing homes seizing assets people have saved all their lives for, etc.

The training to say "never missed a claim" to clients certainly does imply that someone didn't pay a claim.

Well, I don't believe in selling by fear, but I would be surprised if someone could prove every legitimate claim in the history of insurance has been paid. I mean, companies DO go broke once in a while and, from what I've understand, a person would simply become a general creditor, unless completely paid by a state guarantee fund. Nevertheless, I would agree it is ethical to overemphasize that point.

Confederate soldiers getting paid? - I don't think I have a client who's going to buy a policy based on that piece of information.

No, I wouldn't either. But it simply points to a history of corporate responsibility and doing the right thing.

But that would be a great sales call, a NYL agent could open their laptop with it playing "Dixie" so set the mood for the sale.

Alright smartass! So you don't like the NYL agents you know of that trash every other company and you're turning around and pretty much doing the same thing by mocking their company. I wouldn't buy jackshit from either of you.

 

[NHB_MMA]

1. If one is doing research, and one knew that NYL historically has paid out claims, even to the enemy (okay, I am being dramatic for the purpose of conveying my sentiments, the enemy being hostile forces engaged in arms against Union Troops), one would certainly have to put them on one's "short list."

That's one way of looking at it and I can't argue it. However, I suspect the feeling was that these people purchased their policies as Americans and there was a likelihood that some reunification of the South was ultimately going to occur in the post-war era. I understand, for the first part of the Civil War the South looked like it might win and Gettysburg was truly the big turning point, specifically one hill the South was afraid to take. However, I still think it shows something when an insurance company pays on a policy it has no obligation to pay on.

Imagine being a LI agent around 1860. My goodness, what would prospecting entail. Getting on a horse and going from town to town. How would the company get its premiums. The banking system and mail sure as heck was not what it is today. I am joking around with you producers, good natured fun, strictly in the spirit of commaraderie, so please do not get offended. You guys think prospecting is tough now when you have a telemarketing firm getting you leads . . . think how you would have prospected in the horse and buggy days. I bet that was when "cold callers were cold callers, men were men and smelled like horses." Agents no doubt had to go town to town, go into the local saloon, rode around looking for farms; small business prospecting was going to the dry goods store, the livery stable, the local doctor, the local banker, the school marm .... I can see James now....Instead of putting some pastry and fliers in the staff lounge of a hospital, offering to buy a round at the local saloon.

The good old days! I only wish I could do my business on a horse, with my rate manuals and a Winchester strapped over my back.

 

[James]

3. On a side note. Imagine being a LI agent around 1860. My goodness, what would prospecting entail. Getting on a horse and going from town to town. How would the company get its premiums. The banking system and mail sure as heck was not what it is today. I am joking around with you producers, good natured fun, strictly in the spirit of commaraderie, so please do not get offended. You guys think prospecting is tough now when you have a telemarketing firm getting you leads . . . think how you would have prospected in the horse and buggy days. I bet that was when "cold callers were cold callers, men were men and smelled like horses." Agents no doubt had to go town to town, go into the local saloon, rode around looking for farms; small business prospecting was going to the dry goods store, the livery stable, the local doctor, the local banker, the school marm .... I can see James now....Instead of putting some pastry and fliers in the staff lounge of a hospital, offering to buy a round at the local saloon.

Which goes to the heart of my strategy, by staying in front of people on a regular basis will end up creating business, lots of it! Back in the day of the 19th Century the people knew your scheldule or when you be riding thru in your buggy. So that of itself created lots of business, yet no doubt the top agents did prospect outside of the usual business that was waiting on them.

 

[arnguy]

al3, I believe somarco is correct about the 55% cap on LI. Maybe we have an agent(s) who are resident agents in NY that could answer your question, particulary about health. I am a PA resident insurance agent.