- 14,808
Well that's my point - if it's client driven you're fine. If it doesn't require a hard close you're fine.
Why sell permanent Insurance?
- Thread starter James
- Start date
- 943
Yikes! It scares me that you say that! I ALWAYS offer term to my clients who are under 55, and show them why WL or UL is not the answer, its too expensive!
I hate to say it, but buying term and investing the difference is the best concept... you just have to make sure your clients are doing it.
THere are some rare cases that WL makes sense, but for the most part it does not.
- 8,707
I also mainly sell Term my point was that I hate closed minded people that think there is only one solution. I believe buy term invest the difference is great, but how about in situations like this, Husband 70 wife 50 just refianced for 30 years on mortgage, credit card debt, student loans, income Husbands paycheck, SSA and his Maine State Retirement on the Wifes side is her paycheck and a small part of his Maine State Retirement currently have in force 75K on husband WL (written within the last 10 years by another agent almost no CV they expected it to be paid up) Wife would like 25K more on husband to cover mortgage. If the husband passes she can not pay the bills on her salary and what remains of his Maine State Retirement. Would you have written a 10 year term? or put him on a small perm policy. I am not a big fan of WL sellers I cringe when I hear a client say they were told there policy would be paid up ( which never seems to happen when they were told to expect it). But my point was that There is a place in the world for WL, UL, just like on the annuity side a Fixed or Variable or even EIA (Don't you hate the moving parts in these) have a place.
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It occured to me, that I have not ever seen one, or know of one advertisement by any investment firm touting the superior strategy of buying term and investing the difference.
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Check this out. I sure hope James is lurking.
Riscario Insider: Does Warren Buffett "Buy Term and Invest The Difference"?
Riscario Insider: Does Warren Buffett "Buy Term and Invest The Difference"?
- 943
- 4,132
It is good for any agent to understand how each type of insurance works and to understand the use of each type of policy. For those of us in this business a long time we realize that "one size fits all" doesn't fit our business anymore than it fits the shoe industry. Those who champion one type of insurance as a cure all for everybody do their clients and our industry a diservice.
- 3,384
I would address it as using what the situation dictates, leaving options in the event situations change.
If someone says they want life insurance coverage for the period that their mortgage is high and kids are still not done with school, term would make a lot of sense there. I would use one that had a convert option (good one) just in case something changes with that plan (or health).
If someone says, I have some coverage needs short-term and long-term (estate and so on), I might consider a mix of term and perm.
If someone says "I definitely will need this coverage no matter how old I get", well that is definitely a perm situation.
I agree with LGilmore, every situation is unique and I think we, as agents and professionals, have a responsibility to come up with the right advice and product to meet the clients needs and anticipate changes down the road.
I see the overall problem as one of training, in general. Agents are either taught that WL/UL/Perm is always the answer, and other agents are taught BTITD is always the answer. In life, like insurance, there is a whole mess of grey area and not a ton of just black and white.
If someone says they want life insurance coverage for the period that their mortgage is high and kids are still not done with school, term would make a lot of sense there. I would use one that had a convert option (good one) just in case something changes with that plan (or health).
If someone says, I have some coverage needs short-term and long-term (estate and so on), I might consider a mix of term and perm.
If someone says "I definitely will need this coverage no matter how old I get", well that is definitely a perm situation.
I agree with LGilmore, every situation is unique and I think we, as agents and professionals, have a responsibility to come up with the right advice and product to meet the clients needs and anticipate changes down the road.
I see the overall problem as one of training, in general. Agents are either taught that WL/UL/Perm is always the answer, and other agents are taught BTITD is always the answer. In life, like insurance, there is a whole mess of grey area and not a ton of just black and white.
- 1,311
True story - yesterday I went on a sales call (showed up at a lead's house after he responded to a final expense mailer). As I walked up to the house, I could see that a lot of family members were all standing around and they were telling stories. They all looked somber, wearing black.
I found the man who'd sent in the lead card. I told him why I was there. He said, "You're too late. My wife died Saturday." They had just had a memorial service with the relatives that had come into town.
Their son then said, "Let me ask you a question, since you're a life insurance guy." ( I was still in a state of shock. ) I said, "Sure.. go ahead." He said, "My mom had a term policy that expired just last year. Is there anything we can get out of that for her funeral expenses?"
WOW.
I took away two important lessons from that.
#1 - Stay on top of my leads and run them AS SOON as I get them in. This helps in their recall of having sent it, PLUS might protect a family from what happened here - no coverage
#2 - Stay the hell away from term. It's like the warranty on my dishwasher. As soon as the warranty expires - so does it.
I found the man who'd sent in the lead card. I told him why I was there. He said, "You're too late. My wife died Saturday." They had just had a memorial service with the relatives that had come into town.
Their son then said, "Let me ask you a question, since you're a life insurance guy." ( I was still in a state of shock. ) I said, "Sure.. go ahead." He said, "My mom had a term policy that expired just last year. Is there anything we can get out of that for her funeral expenses?"
WOW.
I took away two important lessons from that.
#1 - Stay on top of my leads and run them AS SOON as I get them in. This helps in their recall of having sent it, PLUS might protect a family from what happened here - no coverage
#2 - Stay the hell away from term. It's like the warranty on my dishwasher. As soon as the warranty expires - so does it.
- 4,132
And another little tidbit to chew on for those who still are locked into one camp or the other..
level term is a form of permanent insurance
and...
GUL is a form of level term...
And with certain whole lifes the premium cost can go down over time meaning it is the most expensive the day you buy it and it actually will be the cheapest (and inforce) the day you die.
Go figure?
My how the waters get murky....
We work with silly putty guys.. you can stretch it, twist it, bounce it, copy cartoons and shape it to what ever your client needs.
(disclaimer... silly putty was a fun cheap toy of my youth. If you're too young to have never copied a comic with silly putty, you may have to ask your dad. )
level term is a form of permanent insurance
and...
GUL is a form of level term...
And with certain whole lifes the premium cost can go down over time meaning it is the most expensive the day you buy it and it actually will be the cheapest (and inforce) the day you die.
Go figure?
My how the waters get murky....
We work with silly putty guys.. you can stretch it, twist it, bounce it, copy cartoons and shape it to what ever your client needs.
(disclaimer... silly putty was a fun cheap toy of my youth. If you're too young to have never copied a comic with silly putty, you may have to ask your dad.
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