Questions about simplified issue policies

[DHK]

A. I'm not a financial planner. B. My company only sells simplified whole and some guaranteed whole.

Most "financial planners" (ie. investment advisors) don't have a clue, don't understand insurance except to buy term.

Sell YOUR best products to your clients. Whatever that is. If you're independent, you can keep adding new companies over time. If you're captive, you just need to offer the best you have for your clients. It doesn't have to be "the best of everything out there". That can be a nearly impossible standard. But it should always be the best of what you have to offer.

 

[walthamny]

If you are concerned about doing the best for the clients at this stage, I would say you have a good chance of making it in this business. You either have to stay where you are only sell the product when it is a good choice or move to independent side sooner or later. Start networking with insurance professionals personally and also on this board. Dont think you can learn this business over night. I learn something new in the insurance business every week. Please post here when you are not sure if you are doing the best or not for a client.

 

[VolAgent]

1. Generally permanent will always have less strict underwriting than term. For the simple reason you are getting more premium dollars for the same face amount. Ultimately you need to learn the answer for yourself. Study applications and underwriting guides, pay attention to underwriting decisions. This is not an excuse to study and not sell, just pay attention as you go about your business.

2. Yes and no. You need to keep an open mind about each prospect, however how you got in front of that prospect is going to drive it as well. For instance, people responding to FE mailers are generally going to be whole life, and simplified issue whole life prospects. With MP, you are talking term and often simplified issue term. This is the point of product leads, you aren't just talking to everyone, but people who are interested in solving a particular problem which is usually solved with a particular type of product.

3. GUL can be a great product, for the right person. For the typical FE prospect, not so much. Easier to lapse and often higher face amounts and tighter underwriting than they want. For MP, again probably not. They are looking for something to cover the mortgage. However, by keeping an open mind you may find some that are good candidates for a GUL.

4. Learning through experience. You'll develop your own thresholds for when to switch based upon face amount, health, premium budget, etc.

So really, your marketing will drive a lot of this.

 

[fed up]

Another group of thoughts to ponder. Often fully underwritten policies which are declined will preclude someone from getting another application approved. I have found that by issuing a guaranteed policy while I research or apply for an underwritten policy achieves 2 things.
1) It insures my customer which is the original idea behind applying for coverage
2) It shows my customer how far I will go to do what is best for him/her

We answer all questions honestly such as the replacement questionnaire and let the market decide who wants my customer and who my customer would like to be insured with.

Use your "Bag of Tricks", your knowledge of the carriers, product, and customer, to best insure the customer. It is never about what is best for you.

 

[Fisher]

DHK's avatar is a lie.

 

[DHK]

 

[Matthew King]

It's great that you are worried this much about the client! I agree with Walt, that you should make it in this industry. However, like most others have said. You won't learn it overnight. It will take practice. It will take reading underwriting guides, completing applications, calling underwriters, etc.

Honestly, the first spot to start is finding the need. What do they honestly need? What are their goals in life? What are they trying to cover? Will that need always be there? DHK already said it but it's nearly impossible to give them the best of every possible option out there. Rather focus on doing the best you can for them with what you have now.

There is never a problem with calling an old client and doing a policy review some years later. I know some don't agree with that, that you should just sell and move on. I, however, believe in good customer service.

 

[Newby]

Another group of thoughts to ponder. Often fully underwritten policies which are declined will preclude someone from getting another application approved. I have found that by issuing a guaranteed policy while I research or apply for an underwritten policy achieves 2 things.
1) It insures my customer which is the original idea behind applying for coverage
2) It shows my customer how far I will go to do what is best for him/her

We answer all questions honestly such as the replacement questionnaire and let the market decide who wants my customer and who my customer would like to be insured with.

Use your "Bag of Tricks", your knowledge of the carriers, product, and customer, to best insure the customer. It is never about what is best for you.

You write a GI policy on everyone while you figure out who they will qualify with? Because it insures them while you figure he rest out?

That would only insure them for an accidental death. And it costs over 10x what an accidental policy would cost.

If they are willing to take a GI policy I would pretty much figure they are an FE client. Why don’t you just go with companies that give you a point of sale approval until you get more experienced.

 

[Life Hawk]

Question 1

And here in lies the seeds for success. I'll let stand the above comments, they are filled with great insight and provide good direction.

In taking a more philosophical view of your post...

An important part of what we do is to ask questions. These questions cover two areas or aspects of the business. First we ask questions so that we can become more knowledgeable of our trade, thereby becoming a greater resource to our clients. Secondly, we learn to ask probing questions of our clients, so that we can use our knowledge base to provide options that more greatly fit with their needs, both perceived and inferred.

Continue to ask questions... Continue to seek answers...

"All those who 'wonder' are not lost."

 

[New Ins Dude]

@Newby I believe the strategy behind selling GI first, which is one strategy I thought of, is to do ANYTHING you can to try and get them INSURED as soon as possible, even with the graded terms and extra price. Because from a radically pure life insurance standpoint, you are trying to help them have access to a sum of money that is significantly higher than they already have for a rental fee. So the idea would be to have them pay for like 2 months of guaranteed issue while they wait for a fully underwritten policy, and if the worst case scenario happens where they are actually in very poor health, they will have already started the graded portion of their GI policy.

Personally, I might not choose to start them on GI unless I already knew they had serious health problems. I would probably start them on an appropriate simplified policy while trying to get them on a cheaper fully underwritten policy, because the simplified policies i believe are closer to 2-3x a fully underwritten policy and provide day 1 coverage. Of course, i dont fully know if those price ratios are correct. Can anybody vouch if those ratios are correct and if that sounds like a solid strategy?