Senior Life Unannounced Rate Increase-Normal/Abnormal?

[Newby]

Question: We know that you are or have been a licensed funeral director,correct ?

Regarding Legacy Assurance by Senior Life.....

1.If it's such a great deal for the insured,why aren't Foresters,RNA,Am Am or any of the other large FE carriers offering something similar?

2.The local funeral director has the assignment of the death benefit signed at his place of business by the beneficiary,right ?

3.Can you see the local licensed funeral director assigning any of those benefits,$, for funeral merchandise to a third party,competitor for merchandise he can sell to the beneficiary in his own showroom,place of business? I mean he has the beneficiary right there in his place of business,sales showroom ? Doesn't it help him being that he's part of the community,could already have built a solid relationship with the family,handled services for that family ?
What's the actual reality of the beneficiary having educated knowledge of Legacy Assurance at the time of bereavement,planning a funeral ?

4. How can Senior Life Legacy Assurance provide a real time(not fairy dust)opportunity for Miss Susie in Bumfunct,South Dakota,to actually shop,feel,touch,inspect funeral merchandise hands on ?

5. How come the sale of Legacy Assurance on a Senior Life Final Expense Policy has an effect on the commission structure providing the agent with a higher contract ?


Thanks

Before the funeral rule came out back in the 1980's funeral homes just priced everything into their casket price. You selected your casket and they just hit you with a total that included everything you needed.

The funeral rule required that funeral homes have a menu (General price list) that breaks down everything separately. So if a family doesn't want certain things they can see how much they will save by eliminating them.

When this first happened funeral directors (being weak salespeople) felt that they needed to WAY underprice their intangible services and build the main funeral cost into the tangibles (caskets, vaults, etc.). This kept the price up where it always was but looked like they were charging very little for their services.

Then casket retailers figured out that with those huge margins they could sell caskets much cheaper and still make good margins and not have to do anything other than deliver the casket.

This really bothered the funeral directors because if someone brought in their own merchandise they weren't hardly making anything on the service charges. So they had to smarten up. They had to reprice their service charges WAY up. And lower their merchandise WAY down. Same total but the part that people could buy elsewhere was now priced pretty competitively.

Funeral directors get the best opportunity to sell caskets to families. And they can buy them cheaper than anyone else. So very few funeral directors are going to lose a casket sale these days.

Senior Life's program is not really about selling caskets. It's about appealing as a value add when they buy life insurance. This is my opinion of course. No one has told me this. But I would expect the number of people who buy a casket through their program to be a very small percent of their death claims. Some will I'm sure. But a sharp funeral director would just chop that sale right out from under them most of the time.

And the other part of your question, Is a funeral director going to advance any of HIS money to a casket retailer and wait for the insurance claim to settle to be paid back? I can answer that with an obvious question...would you? If you were talking to a lady to buy a $100 a month FE policy but I told her I can sell it for $90 but she needs to borrow the money from you to pay me, are you going to loan it to her so she can buy my policy instead of yours?

 

[rousemark]

Before the funeral rule came out back in the 1980's funeral homes just priced everything into their casket price. You selected your casket and they just hit you with a total that included everything you needed.

The funeral rule required that funeral homes have a menu (General price list) that breaks down everything separately. So if a family doesn't want certain things they can see how much they will save by eliminating them.

When this first happened funeral directors (being weak salespeople) felt that they needed to WAY underprice their intangible services and build the main funeral cost into the tangibles (caskets, vaults, etc.). This kept the price up where it always was but looked like they were charging very little for their services.

Then casket retailers figured out that with those huge margins they could sell caskets much cheaper and still make good margins and not have to do anything other than deliver the casket.

This really bothered the funeral directors because if someone brought in their own merchandise they weren't hardly making anything on the service charges. So they had to smarten up. They had to reprice their service charges WAY up. And lower their merchandise WAY down. Same total but the part that people could buy elsewhere was now priced pretty competitively.

Funeral directors get the best opportunity to sell caskets to families. And they can buy them cheaper than anyone else. So very few funeral directors are going to lose a casket sale these days.

Senior Life's program is not really about selling caskets. It's about appealing as a value add when they buy life insurance. This is my opinion of course. No one has told me this. But I would expect the number of people who buy a casket through their program to be a very small percent of their death claims. Some will I'm sure. But a sharp funeral director would just chop that sale right out from under them most of the time.

And the other part of your question, Is a funeral director going to advance any of HIS money to a casket retailer and wait for the insurance claim to settle to be paid back? I can answer that with an obvious question...would you? If you were talking to a lady to buy a $100 a month FE policy but I told her I can sell it for $90 but she needs to borrow the money from you to pay me, are you going to loan it to her so she can buy my policy instead of yours?

The funeral home dose not advance ant money ro legacy. The cost for casket. Urn, etc. has already been paid through the $4 per month.

Legacy has to be a cash cow. If you elect not to pay for Legacy, SL collects the "$4" per month from the agent through reduced 1st year and 0 renewal commissions.
If a person does choose Legachy and drops the policy after three years, that is $144 Legac y keeps.
If a person keeps the plan 10 years and the family does not use it, Legacy gets to keep the $480 plus interest.
I would bet there is a small percentage that makes use of the plan. In that case, assuming a 10 year old policy Legacy would pay out the wholesale cost of the casket, etc. Which would be nowhere near thec$3500 stated benefit.
One question I have not seen addressed is does the agent actually get paid on the Legacy fees?

 

[Newby]

The funeral home dose not advance ant money ro legacy. The cost for casket. Urn, etc. has already been paid through the $4 per month.

Legacy has to be a cash cow. If you elect not to pay for Legacy, SL collects the "$4" per month from the agent through reduced 1st year and 0 renewal commissions.
If a person does choose Legachy and drops the policy after three years, that is $144 Legac y keeps.
If a person keeps the plan 10 years and the family does not use it, Legacy gets to keep the $480 plus interest.
I would bet there is a small percentage that makes use of the plan. In that case, assuming a 10 year old policy Legacy would pay out the wholesale cost of the casket, etc. Which would be nowhere near thec$3500 stated benefit.
One question I have not seen addressed is does the agent actually get paid on the Legacy fees?

Yes but Legacy is not "paying out" wholesale cost of the casket. Legacy is providing access to the casket but someone has to buy it. And they are not buying wholesale. Chinese and Mexican made caskets retail for $350 and up. Usually they will be 1/3 to 1/2 the price of an American made casket that most funeral homes prefer to use. So if someone is comparing an 18 gauge steel Batesville casket at $2400 you can find import knockoffs that look very similar for $700 to $1000 and that is not wholesale. That's retail.
I'm pretty sure Legacy is not providing Batesville or Aurora caskets. I would assume they are imports. It's anyone's opinion if they are lesser quality and if that makes a difference.

 

[rousemark]

Yes but Legacy is not "paying out" wholesale cost of the casket. Legacy is providing access to the casket but someone has to buy it. And they are not buying wholesale. Chinese and Mexican made caskets retail for $350 and up. Usually they will be 1/3 to 1/2 the price of an American made casket that most funeral homes prefer to use. So if someone is comparing an 18 gauge steel Batesville casket at $2400 you can find import knockoffs that look very similar for $700 to $1000 and that is not wholesale. That's retail.
I'm pretty sure Legacy is not providing Batesville or Aurora caskets. I would assume they are imports. It's anyone's opinion if they are lesser quality and if that makes a difference.

I am really surprised that more FE companies have not come with a similar incentive to buy insurance from them.

 

[rousemark]

Yes but Legacy is not "paying out" wholesale cost of the casket. Legacy is providing access to the casket but someone has to buy it. And they are not buying wholesale. Chinese and Mexican made caskets retail for $350 and up. Usually they will be 1/3 to 1/2 the price of an American made casket that most funeral homes prefer to use. So if someone is comparing an 18 gauge steel Batesville casket at $2400 you can find import knockoffs that look very similar for $700 to $1000 and that is not wholesale. That's retail.
I'm pretty sure Legacy is not providing Batesville or Aurora caskets. I would assume they are imports. It's anyone's opinion if they are lesser quality and if that makes a difference.

Even if you assume Legacy is actually paying $1000 for the merchandise. That is essentially $48:per $1000 of term insurance coverage at all ages. Not bad.

 

[theinsuranceman]

Yes but Legacy is not "paying out" wholesale cost of the casket. Legacy is providing access to the casket but someone has to buy it. And they are not buying wholesale. Chinese and Mexican made caskets retail for $350 and up. Usually they will be 1/3 to 1/2 the price of an American made casket that most funeral homes prefer to use. So if someone is comparing an 18 gauge steel Batesville casket at $2400 you can find import knockoffs that look very similar for $700 to $1000 and that is not wholesale. That's retail.
I'm pretty sure Legacy is not providing Batesville or Aurora caskets. I would assume they are imports. It's anyone's opinion if they are lesser quality and if that makes a difference.

Legacy says all of their 200+ caskets are 18 gauge steel. Same quality that most funeral homes use.

 

[theinsuranceman]

I am really surprised that more FE companies have not come with a similar incentive to buy insurance from them.

When something good starts there's usually copy cats that follow. I predict within 5 years that all FE carriers will offer a plan like Legacy-Assurance to their policy holders. Looks like a good thing for the consumer and provides healthy competition.

 

[noah]

The best online merchandise purchase is usually the urn and you don't need a monthly membership and with urns you have easier recourse if something goes wrong. Because of the "Funeral Rule" funeral homes must accept outside merchandise and can't charge a handling fee. They are required to have their General Price List with itemized prices on certain items.

So a funeral home can raise itemized prices on things like embalming. services, transportation and then lower prices on merchandise like caskets and still compete. Then they bundle items including caskets and create packages; and of course those are the best value options A, B or C each with your choice of these four caskets. The package savings adds up to a huge percentage maybe 25% or more make sure you include some value added items and only a fool wouldn't want the package. If you purchase casket from the outside you lose the package savings.

I admit people are using outside caskets and many are coming in damaged. Some are not even usable and creating problems for families that is another story.

Before the funeral rule came out back in the 1980's funeral homes just priced everything into their casket price. You selected your casket and they just hit you with a total that included everything you needed.

The funeral rule required that funeral homes have a menu (General price list) that breaks down everything separately. So if a family doesn't want certain things they can see how much they will save by eliminating them.

When this first happened funeral directors (being weak salespeople) felt that they needed to WAY underprice their intangible services and build the main funeral cost into the tangibles (caskets, vaults, etc.). This kept the price up where it always was but looked like they were charging very little for their services.

Then casket retailers figured out that with those huge margins they could sell caskets much cheaper and still make good margins and not have to do anything other than deliver the casket.

This really bothered the funeral directors because if someone brought in their own merchandise they weren't hardly making anything on the service charges. So they had to smarten up. They had to reprice their service charges WAY up. And lower their merchandise WAY down. Same total but the part that people could buy elsewhere was now priced pretty competitively.

Funeral directors get the best opportunity to sell caskets to families. And they can buy them cheaper than anyone else. So very few funeral directors are going to lose a casket sale these days.

Senior Life's program is not really about selling caskets. It's about appealing as a value add when they buy life insurance. This is my opinion of course. No one has told me this. But I would expect the number of people who buy a casket through their program to be a very small percent of their death claims. Some will I'm sure. But a sharp funeral director would just chop that sale right out from under them most of the time.

And the other part of your question, Is a funeral director going to advance any of HIS money to a casket retailer and wait for the insurance claim to settle to be paid back? I can answer that with an obvious question...would you? If you were talking to a lady to buy a $100 a month FE policy but I told her I can sell it for $90 but she needs to borrow the money from you to pay me, are you going to loan it to her so she can buy my policy instead of yours?

If it's such a great deal for the insured,why aren't Foresters,RNA,Am Am or any of the other large FE carriers offering something similar?

How come Lincoln Heritage and Senior Life are the the only Final Expense companies peddling this kind of fairy dust ?

 

[theinsuranceman]

Before the funeral rule came out back in the 1980's funeral homes just priced everything into their casket price. You selected your casket and they just hit you with a total that included everything you needed.

The funeral rule required that funeral homes have a menu (General price list) that breaks down everything separately. So if a family doesn't want certain things they can see how much they will save by eliminating them.

When this first happened funeral directors (being weak salespeople) felt that they needed to WAY underprice their intangible services and build the main funeral cost into the tangibles (caskets, vaults, etc.). This kept the price up where it always was but looked like they were charging very little for their services.

Then casket retailers figured out that with those huge margins they could sell caskets much cheaper and still make good margins and not have to do anything other than deliver the casket.

This really bothered the funeral directors because if someone brought in their own merchandise they weren't hardly making anything on the service charges. So they had to smarten up. They had to reprice their service charges WAY up. And lower their merchandise WAY down. Same total but the part that people could buy elsewhere was now priced pretty competitively.

Funeral directors get the best opportunity to sell caskets to families. And they can buy them cheaper than anyone else. So very few funeral directors are going to lose a casket sale these days.

Senior Life's program is not really about selling caskets. It's about appealing as a value add when they buy life insurance. This is my opinion of course. No one has told me this. But I would expect the number of people who buy a casket through their program to be a very small percent of their death claims. Some will I'm sure. But a sharp funeral director would just chop that sale right out from under them most of the time.

And the other part of your question, Is a funeral director going to advance any of HIS money to a casket retailer and wait for the insurance claim to settle to be paid back? I can answer that with an obvious question...would you? If you were talking to a lady to buy a $100 a month FE policy but I told her I can sell it for $90 but she needs to borrow the money from you to pay me, are you going to loan it to her so she can buy my policy instead of yours?

Remember, Ms. Jones picks out the casket she likes way before she passes. There's a record of which casket she likes. I'm thinking that if the funeral director tries to undercut Legacy on the price of their casket ($1500) most families will say something like "we don't want to change anything. This is the casket momma picked too be buried in from Legacy and that's the casket we're going to use".

Now if the funeral director has a casket in house that matched what momma picked then he may get the casket sale. Legacy has over 200 caskets to pick from. I've seen caskets that are blue, red, white, etc. that I've never seen anywhere else. I don't know of any funeral homes that carry an inventory of over 200 caskets in house.

Even if the funeral home makes the casket sale, Legacy is also in the family's corner price negotiating with the funeral home, sharing prices of neighboring funeral homes, etc.

And Ms. Jones, while living, enjoyed discounts on hearing aids, free annual hearing exam, discounts on diabetic socks and diabetic shoes, 24 hour telemedicine. These savings right here more than subsidize the $4 monthly membership fee. She's getting way more than $4 of value each month.

BUT WAIT....THERE'S MORE!

Ms. Jones can pick any 4 family members and they are added to her $4 monthly membership for free. So Ms. Jones mother, who is 97 and too old to buy insurance, all of a sudden gets her casket, vault, and monument locked into place for $2950 where as at the local funeral home these 3 items would be $7000-$8000. So now that her 97 year old mother can save $4000-$5000 on her funeral...why that's like she just got a free $5000 policy with immediate coverage.....even though she's in a nursing home with alzheimer's.

 

[theinsuranceman]

I am really surprised that more FE companies have not come with a similar incentive to buy insurance from them.

They will. Some of the carriers are struggling and will look at this as an extra income stream.