This is a shame

Discussion in 'General Insurance Agent Discussions' started by NHB_MMA, Oct 9, 2006.

  1. NHB_MMA
    Offline

    NHB_MMA Guru

    Posts:
    475
    Likes Received:
    0
    Okay, some I'm one that believes that both term and WL have their pros and cons and their respective places in the insurance world. I think that 99% of the population should have a moderate amount of permanent insurance, with the bulk of the face value coming from term, due to costs. I think people that take a hardline approach criticizing one or the other as worthless are commission motivated.

    I think it is a huge disservice to convince a client to bank on permanent life insurance as the lion's share of his retirement income, although there is nothing wrong with it as one component of retirement planning. I was talking to an agent in my office this weekend about seeing this friend of mine that is mostly interested in investment products. I'm not securities licensed and not allowed to offer brochures or solicitations but just reviewed his insurance and talked about some ideas for 2007 when I'm licensed. Anyway, this other agent actually suggested I compare the Roth IRA and a WL policy and show a WL policy to be superior. :shock: First, I don't know how to do that. When a person already has a fair amount of insurance coverage, I think it's pretty hard to justify that he wants to earn 4% for retirement savings. Yes, I know there are some added benefits to WL, such as it being shielded from creditors, has equity that banks will recognize, and above all else the death benefit. But I mean, a conservative bond-based IRA should yield 5% or so, I would think. The WL is tax-deferred and the Roth IRA is post-tax, so the growth would be the same. I can't believe anyone would suggest a WL policy to be superior to a Roth IRA, strictly for retirement purposes. Needless to say, I didn't present that idea.

    :? Can I make an honest living, cause I ain't going that route? :roll:
     
  2. James
    Offline

    James Guru

    Posts:
    2,152
    Likes Received:
    0
    I don't think its a either or situation. Do what is best for the client, if that is W/L, IRA or whatever. Yet to go in and say one product is better then the other you are doing nothing more then peddling a product may it be Insurace or Securities.

    Now you go in and do what is best for the client may it be this product or that product, then you are selling to the client. The product should always be second to the needs of your client. In other words not any one product is a perfect choice for everyone or anyone.

    How far do you think I have to go to find those that will not listen to what a FP'er that uses MF's and/or Securities has to say? How far you think I have to go that don't want to hear a W/L spiel? The answer is likely the same distance, its just the way things are.
     
  3. MIBizInsurance
    Offline

    MIBizInsurance Guru

    Posts:
    279
    Likes Received:
    0
    NHB I've tried to reply to your threads with detailed replies here and at other board (to no avail) so this time going to keep it as simple as I can-

    If your not comfortable with NYL, your manager, the way they want you to sell or "turn head" -leave.
     
  4. Sam
    Offline

    Sam Founder Administrator

    Posts:
    1,517
    Likes Received:
    9
    This is actually not true. Of the top 20 most competitive companies in the life market maybe 2 or 3 are not rated at least A+. When I hear that a client has a NYL policy, I rejoice, because the sale is already over.

    I have read many of your posts and you do seem to have integrity, so please don't take this the wrong way, but I think that if you want to be successful with NYL, you need to stop coming here.

    There is a certain cognitive dissonance that is VITAL for you to succeed. If you ask any successful career agent, they will tell you that they actually belive that their products, all of their products, are the best around. If you don't drink that coolaide, you cannot be successful.

    If you can't convince yourself that a relationship with you plus a decent product is better for the client than an excellent product with no relationship, then you cannot make it work. That is the entire premise that you are selling, and I am not doubting the validity of it. However, you don't really seem to believe it, and that will be a problem for you.

    Captive agents do not succeed when they read forums that are populated by independents, unless they have been in the business for a long time. Much of your view on what is best for the client seems to be shaped by what you have learned on the forums. Ordinarily, that is a very good thing, but if you want to be successful with NYL, you need to read more company literature, speak for hours with old agents, and fully immerse yourself in the culture.

    Otherwise, that big sale will come along, and you will either say no, because you have an independent outlook, or say yes, because you need the money, and hate yourself.

    Captive agents can do a lot of good and can be proud of their careers, even if each particular case cannot be objectively reviewed by independents and approved of as the best alternative. You need to swallow that belief, or find a new career.
     
  5. Sam
    Offline

    Sam Founder Administrator

    Posts:
    1,517
    Likes Received:
    9
    For some reason, my new reply was posted as being before your latest. You should read it.
     
  6. midwestbroker
    Offline

    midwestbroker Guru

    Posts:
    2,343
    Likes Received:
    4
    State:
    Kansas
    I have been on both sides of the fence, captive and independent. I think it really depends on the market you serve, the area you live in and the products available.

    I focus on the Medicare market. There are 2 main players here (Kansas City) that offer MA plans, Humana and Coventry. Both have captive agents that get salaries (something is better then nothing), leads, marketing support, and such. So, to make the most bang for your buck, you are better off being captive. That and Humana does not let independent agents sell their HMO and PPO plans in the metro, only captive agents.

    Now, the life insurance, health insurance, and other markets, I can see where being an independent agent can be a better fit.

    If you are worried about making it as an independent, get a part time job. I used to bartend and sell insurance (sometimes both at the same time).

    Point, you better love what you sell, or people will love to say no to you.
     
  7. James
    Offline

    James Guru

    Posts:
    2,152
    Likes Received:
    0
    Okay, I suggest you leave NYL, that is a sales job not a job of consultant. Let me say this another way, you will not succeed at NYL, they sell, they sell W/L.
     
  8. NHB_MMA
    Offline

    NHB_MMA Guru

    Posts:
    475
    Likes Received:
    0
    Most any of these products has their place. I suggested that my friend get a modest amount of WL, as I believe anyone should have, but he did not seem too open to the idea at this time. I think it's safe to say that it is very likely a good Roth IRA would outperform a 4% WL policy over the next 33 years till his retirement. Of course, a person could get too aggressive and lose what's in his IRA, but if it's well thought out and reviewed I don't think it is unrealistic to get 5%-8%, which would beat WL by a substantial margin.
     
  9. NHB_MMA
    Offline

    NHB_MMA Guru

    Posts:
    475
    Likes Received:
    0
    It might not be that simple. I have a somewhat unimpressive work history (not in terms of stability, but I just haven't done well for myself) due to some bad career choices and I crashed an internet business venture sometime back and had to file a bankruptcy. Some insurance companies wouldn't accept me. I know State Farm wouldn't for sure, and I have to wonder how others like Guardian would view me. I had to provide a great deal of documentation and explanations for this position I have now. If I walk away now, I don't know where I can go besides independent. What are the odds that someone with such poor product training/knowledge could ever make it as independent? Who could I go to in the office to ask questions and recommendations for prospective clients if I am the office in its entirety?

    I will NOT sell anything that contradicts what I believe the client needs, unless they specifically reject my recommendations and ask for something different. Most families probably need about $1M in life insurance. About 750K should be term and 250K could be WL--if they can afford it. If not, I would suggest a 90/10 blend. If somebody with more money wants a greater percentage in WL, that's great, but they probably need more than $1M, so I think the percentages hold true. Large funding in WL is good for some people that could be subject to lawsuits and want the money shielded or those that want a conservative return and have other assets (such as property) to liquidate. Otherwise, most people should be looking to higher return actual investments once they have their insurance taken care of, hopefully with a modest amount of whole life. As has been mentioned here, match anything your employer will contribute to on a matching basis. Some have suggested that a good VUL policy could be the be-all, end-all solution if done right, but I don't know anything about them yet.

    Anyway, I'll not sell ideas I don't believe in, so we'll see how it goes. Fortunately, I have been surprised to find how competitive my company has been on life insurance in terms of premium. I'm not talking about comparing them to junk found on internet sites, but top rated companies. Of course the "B-" rated company is going to undercut them. And their LTC is the Cadillac of the industry, although it's a market I don't know enough about, and the annuity products seem good too.
     
  10. NHB_MMA
    Offline

    NHB_MMA Guru

    Posts:
    475
    Likes Received:
    0
    Believe me, this has been tough for me. I feel like I don't have much chance to go elsewhere and like I have limited options.

    Again, it's not that I don't believe in WL, but just not that it solves all the insurance needs (for affordability reasons--must be used along with term) and that it is not adequate for complete retirement portfolio. I know you sell a large deal of WL and I wasn't trashing your products by any means.

    The problem I have is that, as I mentioned, there is no way a WL is going to outperform a good blue chip mutual fund over the long haul and the only reason an agent would ever suggest it over an IRA is for commissions. NYL wouldn't even be in the securities arena if they saw no use for them, I'm sure.

    As for being a consultant, I want to offer clients the best solutions I have to offer. I realize that I am not independent. My job is not to sift through everything that 1400 different insurance companies could possibly offer but to offer the best that I can offer.

    BTW, any thoughts on VUL?
     

Share This Page