This Will Help on ROP Cases

[Mark]

In Life Insurance Selling Magazine (June 2009) on page 40 Byron Udell wrote something that I liked. He is explaining to a client how R.O.P. works. I wanted to share this with you all.

Here is how he explains it.

”Mr. Client, here’s how it works. You set up an account and put $1,000 per year in it. The insurance company also sets up an account and they put $1 million in it. If you die any time during the 30 years, we simply switch accounts. Otherwise, if you still here at the end of the term, you keep your account: The insurance company writes you a check for $30,000.
Of course, the “account” pays no interest, but in today’s world, a return of your money is a whole lot more important than a return on your money”

 

[moonlightandmargaritas]

ROP term is still not a good deal for the client.

 

[dgoldenz]

ROP term is still not a good deal for the client.

x2

 

[Mark]

I talk with clients everyday that didn't buy or have the R.O.P. rider on their term policies and now their term period is over and they still need some life insurance. Most of them just spent between $15,000 and $50,000 on their term policies. It would have been nice if they would have gotten all of their money back and used it to help bury them and pay off some debit. A lot of my clients never had the option to buy R.O.P. when they bought their coverage. They all tell me they wish they had the option.

I personally have R.O.P. on myself and I believe in it.

Less then 2% of clients will term insurance will die. Why should the other 98% not get a full refund on their money when they don't die and the coverage is over?

Some people still believe in buy term and invest the difference, but I've never seen a client do that.

The avg young family needs big protection for the next 30 years until they pay off the house and take care of the kids, but after 30 years, their needs will go down. They will always need to have enough to coverage the funeral and a few other things. You will either die and get the coverage you need, or get all of your money back. You can then use all the money you have paid for the term policy to buy a S.P. policy and almost double your money, or do whatever you wish with the money.

For the agents that don't sell R.O.P., I say "THANK YOU" . I love coming in after you and showing this to your clients and walking out giving them what they needed to start with. Now they are my clients.

 

[moonlightandmargaritas]

Why should the other 98% not get a full refund on their money when they don't die and the coverage is over?

Because they got the protection, that's why.

Do you get a refund of your auto insurance premiums? Homeowner's? E&O?

These "smokescreen" arguments don't wash.

 

[Mark]

Because they got the protection, that's why.

Do you get a refund of your auto insurance premiums? Homeowner's? E&O?

These "smokescreen" arguments don't wash.

If they would offer it. I would personal buy it.

On my car insurance, if I didn't wreck my car in 5 or 10 years, they would then go back and give me all of my money back. That would be great. I would be willing to pay at least 40% more money for this option.

That would be great on E and O insurance. I've never had a claim and I've put a lot of money into it and it would be nice to get all of my money back one day.

My clients and myself love R.O.P.
I love asking clients if they don't die, do they want their money back or not. They always say yes and I add the rider. I think it is best for the client to give them all of their money back, if they don't need the short term protection.

I could write a book on this subject, but those that don't understand the product, never will.

I'm very happy that not every agent liked R.O.P. It makes my job a lot easier. It is like preaching to the choir. I find other agents clients that have term and have not been offered the R.O.P. rider and simply offer it to them and explain to them how it works.

At least offer it to you client and let them decided if they want it or not. If you don't, other agents and myself will.

 

[Norwayguy]

Can't we just agree to disagree on ROP....I've offered it and sold it to some clients...and for most clients I offer it and explain how it works and after being educated most people choose not to take ROP. This is not one of those its right or wrong for everyone questions.

 

[moonlightandmargaritas]

I offer it and explain how it works and after being educated most people choose not to take ROP

You're not suggesting that Mark's clientele is uneducated, are you?

 

[dgoldenz]

I talk with clients everyday that didn't buy or have the R.O.P. rider on their term policies and now their term period is over and they still need some life insurance. Most of them just spent between $15,000 and $50,000 on their term policies. It would have been nice if they would have gotten all of their money back and used it to help bury them and pay off some debit. A lot of my clients never had the option to buy R.O.P. when they bought their coverage. They all tell me they wish they had the option.

I personally have R.O.P. on myself and I believe in it.

Less then 2% of clients will term insurance will die. Why should the other 98% not get a full refund on their money when they don't die and the coverage is over?

Some people still believe in buy term and invest the difference, but I've never seen a client do that.

The avg young family needs big protection for the next 30 years until they pay off the house and take care of the kids, but after 30 years, their needs will go down. They will always need to have enough to coverage the funeral and a few other things. You will either die and get the coverage you need, or get all of your money back. You can then use all the money you have paid for the term policy to buy a S.P. policy and almost double your money, or do whatever you wish with the money.

For the agents that don't sell R.O.P., I say "THANK YOU" . I love coming in after you and showing this to your clients and walking out giving them what they needed to start with. Now they are my clients.

Can you tell me how many term policies stay on the books for the full 20 or 30 years? Almost every single person with a 20 or 30 year policy will replace it well before it's ready to expire, so unless they keep paying those premiums for the full 20 or 30 years, they get screwed by having to pay twice the price for the first 10-18 or 20-25 years and getting minimal cash value back when they terminate the policy.

 

[Norwayguy]

Can you tell me how many term policies stay on the books for the full 20 or 30 years? Almost every single person with a 20 or 30 year policy will replace it well before it's ready to expire, so unless they keep paying those premiums for the full 20 or 30 years, they get screwed by having to pay twice the price for the first 10-18 or 20-25 years and getting minimal cash value back when they terminate the policy.

dgoldenz I agree with you and will take it a step beyond I am not aware of a mass selling of ROP term products until recently say the last 9 years or so, so how many people after 5 years with the policy even remember the ROP part to the policy and someone else says you are overpaying and they replace the policy.