When it comes to researching (and eventually buying) financial services products, increasingly consumers expect their online experiences with agents and financial services companies to match their other online retail experiences.
Understanding what consumers look for and where will help the industry improve the way they engage with today’s consumer online and open up new opportunities to sell insurance products.
LIMRA surveyed U.S. consumers who recently researched and/or purchased individual insurance products (life, disability, long-term care, and annuities) to find out what led them—both online and offline—to consider these products. LIMRA then compared the current data with data from a similar survey done in 2015 to look at how preferences and behaviors have changed over time (see chart below).
While using the internet to research insurance products is still relatively new, about half of all consumers—and 6 in 10 Millennials—will consult both a financial professional and the internet when seeking information about individual insurance and annuity products. Baby Boomers are the most likely to rely solely on a financial professional, especially for annuities (37%).
Of those who do not seek information online, 42% are Boomers, 33% are Gen X and 15% are Millennials. Most often, these consumers want to meet with someone in person, and to be able to ask questions.
LIMRA’s new study found more people are using an online agent locator (increasing from 23% in 2015 to 29% in 2018). Although still a small percentage, the total number of people who found a financial professional through social media (e.g., LinkedIn or Facebook) has doubled, from 4% in 2015 to 8% in 2018.
Brand awareness continues to draw the most consumers to an insurer’s website. Nearly a third of consumers said they visit an insurer’s website because they are familiar with the brand or already own a product from that company. LIMRA found, however, a growing number of people are locating insurance company websites using other methods, including online ads, online review/opinion sites, or on social media.
What are consumers looking for online?
Seven in 10 consumers say it’s very/extremely important to be able to get a quick estimate on the cost of a policy, and just as many would like to answer a set of questions to improve the accuracy of that quote.
More than half of all consumers – and almost two-thirds of Millennials – are looking for online calculators to help them determine what and how much insurance to buy. These findings are consistent with the study done in 2015.
A growing number of consumers expect to have the ability to buy insurance products online. In 2015, 45% of consumers felt this was very/extremely important, by 2018, it had jumped to 54%.
Looking toward the future, insurers need to be responsive and proactive both online and in-person. LIMRA research shows the ability to access online information is more important to those making buying decisions about insurance.
To successfully engage these shoppers, insurers and agents must create a personalized, online experience that is easy for consumers to research products, while also increasing their confidence that they are choosing the right policy for them.
This one line bothers me. “Increasingly consumers expect their online experiences with agents and financial services companies to match their other online retail experiences.”
Life and/or health insurance is not really designed to be mass produced. One size does not really fit all. Call me old fashioned if you wish but the best way really is to sit down, either in person or over the phone, and have that conversation. We don’t really know what our customers wants and needs are till we have that conversation.
The same folks that designed, implemented and manage hc.gov felt it was time to give the consumer that "online shopping experience". BHO made a video about finding a metal plan on the internet. He declared it was as simple as ordering an airline ticket.
How many folks buy a ticket from Atlanta to LA based on the lowest price only to discover there are two stops and layover time of 4 hours?
And our friends in DC also designed and implemented the new Medicare Plan Finder. A completely worthless tool.
What could possibly go wrong?
Internet steadily becoming the way consumers learn about insurance products
You can also learn much more about Russian meddling and aliens while your shopping for insurance… :yes:
Don't you just hate it when the Russians meddle with Aliens? I always thought the Men In Black were supposed to take care of the Alien problem.
Personally, I use the internet to keep up with the Kardashian's.
The flawed assumption is that people "read".
Life insurance is NOTHING like auto or fire insurance which people want to buy. Life insurance is a grudge sale, something you buy that will not benefit you.
I'm a P&C guy, not L&H. From the P&C perspective, there is about as much misinformation on the internet as reliable information.
Did Abe Lincoln say that?
You can fool some of the people some of the time . . .
People definitely research life insurance online.
You're right, people don't read.. they skim. Which means you have to write web friendly.
Hard to keep up with what sex they are. :twitchy:
No, I think it was Al Gore. After all, he invented the internet. :yes:
Since I write larger and more complex commercial p&c, the chances of my clients going online (or anywhere) and getting a complete understanding of what they need, complying with contracts and landlord demands, is about 0. A large amount of my business comes from other agents that have screwed it up or turned it away.
But personal p&c? I'd be surprised if more than 10% of the population is using an agent 10 years from now. That's why State Farm and Farmers are pushing banking and life insurance so hard. Most home and auto is simple enough any idiot can figure it out and buy online. A decade from now only the higher net worth and more complex personal polices will be through an agent, the rest will likely be online.
"Online" are still agents, just like you. Or agencies…
Even as carriers go direct online, there is still not a comparison opportunity unless you're quoting with an independent agent/agency.
This is simply a shift in buying preference, not selling.
I love this trend. If a consumer comes to me more informed about disability insurance and knows what they're looking for and an approximate cost that they're willing to pay, that app is a layup.
It helps a lot when your customers know what they "think" they want. The rest is still an education process mostly completed over the phone. Often, their thoughts change but at that point, they are engaged and are going to move forward in some capacity.
The trend is your friend.
…And what will be the next? Which way the agents should go to save their business or they will loose it any way? What do you think about it, colleagues?
I saw the writing on the wall a long time ago and went commercial.
A lot of personal p&c is going to go bye bye to Progressive, Geico, Lemonade and Esurance. It's already happening, and keeps accelerating.
How we market ourselves will a differential as well. Are we chasing them? Or are we drawing them into us?
That and that.
When they come to you, you're not selling (as you know). You're educating them on their choices and they're buying what's best for them.
It sounds the same but feels different on both ends (agents/consumers).
I completely agree with Ray and Wino. The barrier to entry with digital marketing is more challenging up front, but the highest ROI when you're doing it yourself.
Anthony Martin, who owns MutualChoice.com, started grinding out his website about three years ago. He gets 20k in traffic a month. Even with a conversion of 2%, guy is processing 400 leads a month.
No wonder he's a million dollar agent.
Hey Travis,
Are you a member of http://www.selltermlife.com? A lot of like-minded agents on the forum over there (including Anthony).
I would recommend joining if you're interested in digital marketing. The conferences are also fantastic.
10X10
I am seeing a couple tomorrow I have never met.
They were referred to me by her best friend. She called me. The opening conversation was something like this. Her >"I was wondering if you would help us" They have New York Life and I think AIG now. I can tell by our conversation that She is bright and has been reading online. That is going to make the conversation with them much easier. I prefer to work with people that already own insurance and have some understanding of it.
I'm in on the Digital Marketing Facebook group Jeff and Nick admin. I definitely am interested in going to a conference.
And he looks like he is 25.
I hate him!
Kidding.
San Diego or Vegas next May. They're a blast and you'll meet some guys that write some incredible business through their websites.
Everyone is pretty open about sharing too (since very few people take action). Really fun and completely worth the time. I always walk away with ideas that I can immediately implement and some back burner stuff that I find interesting.
He's not much older (30s) and works out like a beast so that helps.
He also bought about 30 of us dinner at a steakhouse without telling us beforehand a few months ago. Just got up and shook everyone's hand and left.
Dude is a class act.
MutualChoice.com is a blank site. What am I missing?
Sorry Choicemutual.com
Nice to see I am not the only dyslexic person here.
Oh gotcha. Nice looking site. I don't' get how people find it but glad it works for him.
What're you smoking Travis? 🙂
Think about something you would type into Google.
For example, Burial Insurance for Seniors or Burial insurance for my parents
He is definitely on page 1 and in the top three for a lot of those types of terms.
That's how people find him.
He has a TON of content and a lot of high authority backlinks.
Those vap flavors that keep getting banned
He generates over 1k organic leads per month so people are definitely finding it.
It's like Travis said, think about what you'd type into Google/Bing/Yahoo is you were looking for a policy. Chances are his site is "above the fold".
A lot of kids also look for these policies for their parents. They aren't sending back DM or responding on facebook. They are using search and looking for E.A.T.
Michigan is recreational legal so I'm guessing that he has a ton of options.
I strongly disagree. First, many people would be stupid enough and cheap enough to go with out auto or homeowner;s if they were not forced either by law or by lenders to do so. Just witness the stunning lack of renter's insurance possessed by the nations renters.
No one buys life insurance who doesn't want it. Every sale is for the sake of someone you love. And an agent properly trained in the benefits available to the owner of a life insurance policy while the owner is alive will find clients who want more life insurance than they thought they did.
I kind of get what you guys are saying but then again I don't. What the heck is a back link?
Also, I wonder how much he paid to create all the content on his site. I took a look and there's a lot on there.
I thought you were taking the month off from the site so you could hit production hard?
:eek::err:
I was out from 9 AM to after 9 PM … why you work me so hard?
Backlinks are other sites linking to your site with "dofollow" links (this site uses "nofollow" links which are still authoritative but don't have the same "link juice").
The more authoritative the site, the stronger the backlink. Those links help tell Google that your site is an authority on your subject and thus you're ranked higher for that term.
So for example, a medicare site that has a "dofollow" link from medicare.gov would be huge (spoiler: that doesn't happen) but if that same site got a link from abcbullshitmedicare.com with no real following, it wouldn't mean much.
A lot of us use services like HARO to get published but it involves diligence and consistency.
As far as the content, he personally wrote all of it.
If you're dedicated, you can easily write a few 1k words per week and have 250k+ on your site in a few years.
If the content is relevant to your audience, your site will rank.
Interesting that isn't actually very complicated but sure sounds like a lot of work to say the least.
So you talking about what, cash values or living benefits?
Yes. It is a ton of work. However… If you're pulling 1k per month in leads using organic traffic in 3-4 years..
Is it worth it to spend 15 hours of your week working on your website?
Did they mention he is also 100% tele/internet sales. Leads with MoO FE. Oh, I believe has never run a F2F meeting (I think)
He ditched class on the day they were teaching it can not be done.
It is a ton of work but I place 4-5 DI policies online per month following the same system and I will be doing double that in a year based on my current metrics.
Retail is also a side job to insulate me from these stupid interest rates and market movements.
My market (DI) doesn't have the same volume as final expense or term but my average annual premium is 2200 and the business is super sticky with huge renewals.
I share this path freely (that Jeff Root taught me) because 99% of the people reading this post won't do it.
Why would someone want whole life other than the death benefit. Michael Dell, founder of Dell Computer pays a $1.2 million per MONTH premium for his WHOLE life insurance. If WL is such a bad investment why do banks own billions and billions of dollars of cash value life insurance? Why would a businessman like Michael Dell want to put $1.2 million a month into a whole life policy?
Could it be because he is guaranteed never to lose any of that money? Or because the gains accrue on a tax deferred basis? Maybe it is because the money is always accessible to him whenever he might want or need it? Or maybe its the fact that when he does take some money as a loan, it is a loan against the policy rather than from the policy, so the interest and dividends continue to accrue as though the money is still there? Could it be because such loans flow to the policy owner as tax-free cash flow rather than taxable gains like 401K and traditional IRA money? And where is the 401K or IRA that can take unlimited monthly contributions? Oh, you mean they don't exist?
Perhaps it is because he can use the money whenever he wants it so he can take advantage of investment opportunities without liquidating taxable assets or needing to borrow from a bank (as the whole life policy allows him to become his own "bank")?
Maybe he does it because should he ever suffer a critical illness such as heart attack, stroke, or cancer, he can use the money to offset any financial exigencies that arise as a result of the illness? Or the fact that he can use the money to pay for any long term care or assisted living help he or a family member may require as he ages? Oh, and then there is the fact that the leveraged death benefit will replenish any and all the money he may have used to help himself or his family pay for any of those expenses.
Who knows – whole life is such a dumb investment. I'd rather buy term and burn my premiums like the cable bill. But hey, if I feel like it I can buy a fully taxable stock market investment that may or may not go to zero and avoid having to decide which of the many benefits of whole life I might really want or need.
Maybe Michael Dell is using the whole life policy as a self-funded private pension to provide him with cash free income for life? Jeez … I got to stop this or I might convince some Primerica agent that they are making a terrible mistake for themselves and their clients by only recommending term.
Don't feed the troll who hasn't sold life insurance in 30 years. He has a great quoter and I will recommend it to anyone but his life insurance advice is wholly inaccurate in most cases.
I did that more for me – I like being challenged to defend my product. Keeps me sharp.
From our interactions, you probably know that I feel the same way.
But sometimes it ends up like arguing politics…everyone loses.
Wow, anything over five hours is a long day for me.
Illinos will be 1/1/2020.:jiggy:
Thanks for answering my question.
Work is struggling to find prospects willing to see you or talk to you.
Life is different when THEY call you.
If you keep using that type of vocabulary we're going to get the idea that you're edumacated or something!
Now, if you'd only stay off the interweb you'd avoid those ugly quarrels and could sleep peacefully with dreams of "90K in 90 Days".
Unfortunately I have a conference call with one of my carriers this morning at 9 AM … but then back in the field til 9PM tonight. No interwebs during work hours. I've removed FB and FB Messenger from my phone, and I blocked everybody from texting me except @jdeasy and @SPUR CITY
¡uʍop ǝpısdn ǝq ʇ,uoʍ noʎ ǝsıɯoɹd ı ˙ǝɔuǝɹǝɟɟıp ǝɥʇ ʇsǝʌuı puɐ ɯɹǝʇ ʎnq
I would always argue the hardest part on content writing (and one of the most important) is being consistent in your posting schedule.
Web crawlers learn to index your site based on your frequency.
In my case, there are weeks that I can pound out 3-4 articles and then some weeks I just don't want to.. so I'm better off posting 1-2x a week than 3 one week, 0 the next. In my weeks where I'm super motivated, I schedule the post for in the future.
Why does everyone assume that if you buy term you must "invest the difference".
Example: Young family with dependents, debt (mortgage car loans) and no assets. Family depends on breadwinner income. Breadwinner needs a million dollars of coverage. Tell me how that family is going to afford a million of whole life? There's no money for that, but they can afford a million of 20 or 30 year term.
So there is no extra money to invest. What do you do? Do you recommend less insurance because you don't want them throwing their money away? And what do you say to the spouse after the insured dies. Gee, sorry, if I had known they were going to die I would have recommended more coverage?
No one size fits all in my world.
However, I am sure the conversation is different than the 'Sorry Bill, if you would have died from the Cancer the policy would have worked great. However, since you didn't and with the recent heart attack and your 20 years being up next month….' conversations I have with clients several times a year.
You may remember when we first meet, by phone, +25 years I was sell a lot of term during the term wars. I still service those clients.
Whole life is a tool, just like Term. No one is saying that whole life is always the right plan.
In most situations, people that buy whole life need insurance for situations that don't change. Another strategy, that Dave Ramsey supports, is to buy term and invest the difference so you can self insure at the end of the term.
However, honestly, most people don't invest the difference. Them when the term ends they get an awesome increase in premium and nothing to show for it.
Dave has some really basic, easy advice; however about whole life he's wrong.
The best term policy is one that is level until your retire, age 65 or 70. Banner is now out with a 40 year term that gets a 25 year old to 65.
Providing you have the coverage your family needs if you die, then it's about accumulating as many nuts for the winter as you possibly can. The problem most people have is NOT understanding how many nuts they will need. That's why I designed this:
TERM4SALE | Retirement Calculator
One of the things I learned very early on is that the notion most people can retire at 65 is silly. Not going to happen. Personally I am pushing all pension savings off (including Social Security) and don't plan to touch any of it until I am 70 1/2. And at that point draw minimum from the IRA's. Why? Because I have NO intention of retiring. My retirement savings are really my disability fund, and God willing I will work right up to my last breath.
If you get to retirement, and you do NOT have enough money, buying insurance is NOT feasible. How can you afford a premium when you can't afford food? And if you had whole life, and even if it's paid up, you'll end up dumping it to buy the food.
I should note I have $350,000 of permanent, and while that's not much today, it means my wife or my kids have some liquidity to tidy up the mess I leave (assets that have to be sold or passed along).
As someone who worked Industrial Life Insurance, I can tell you that your assessment wasn't my experience. People paid their premiums every month and the ones I had to go see had the money ready, but had forgotten about the date. These people were SSI/SSDI and older people that hasn't planned.
I rarely had loans taken out.
You're welcome to your opinion. I simply disagree.
🙁 how 'bout me! My feelings are hurt. 😉
Way too many assumptions in this post to be useful to an agent that works with more than one very tight demographic. The group you describe is Bob.
As Ray said, you know quoting software. I used it for many years. (Sometimes wish I still did.) Back in the floppy disk days, mailing them back and forth. You are good at building quoting software. You know more about quoting software than I do.
You would not make a good insurance agent today. I know more about insurance clients than you do.
All IMohsoHO
Dave Ramsey's Term recommendations have more to do with the fact his radio show co-host was Roy Matlock Jr (of Primerica) than it does about financial knowledge. A great way to promote a company's products in the bible belt is to hitch a ride with an already established celebrity of sorts with religious overtones. Didn't hurt to get in tight with Jerry Falwell Sr either.
That!
People forget how important it is to know the client. Yes, you can learn to sale, but knowing people is how you become a professional. I know some bang up salesmen, but when it comes to knowing people and acting like a professional… they're all wet.
Yeah, I don't really listen to Dave Ramsey. His advice can be really helpful for people that don't understand money. For that, good for him. I just know his arguments don't make sense to me about whole life.
It's like that doctor that pitches that you can get by with Medicare by itself.
Well, there are insurance salesmen and insurance agents. Nothing wrong with being a salesman at all. I know some insurance salesmen that are making bank.
Not everyone that can sell can be an insurance agent. I have a long-time client that is a top car sales guy. Has the rings, plaques cars and so forth. Sold me a car. He tried insurance and failed miserably. He just sucks at having to be a human for longer than an hour at a time. Get the sit, close the deal, pitch a ton of overpriced add ons, pass them off to finance. Wham Bam thank you ma'am
That's what I tell my wife.. she's not a fan..
All my friends and family that bought life insurance, bought term and invested the difference. All but one became millionaires before turning 40. If they had put that money into permanent life, they would be worth hundreds of thousands instead.
Those same friends have solid J-O-B-S with great pay and benefits, and scoff at those selling MLM products while making peanuts, or worse, losing money. Term didn't make them rich, their J-O-B-S did. And when it comes to collecting on their expired term policy later in life, with a spouse who has become accustomed to the finer things in life, they might very well discover the downside of term.
Wrong. Wrong. Wrong.
They all got rich by investing their money. Every one of them. They bought term and invested the difference. Not some. Not most. All.
I think that's great!
I don't think everyone has that ability (management wise.) A lot of people let lifestyle creep happen.
What I like about a whole life policy is the cash value. It's a forced savings vehicle. Not everyone needs it, but there are enough people that do. Insurance should last until you can self insure, imo.
Some people don't have the discipline to leave money alone and let the 8th wonder, compound interest, work it's magic.
If every life insurance salesman used the same amount of energy teaching people to invest their money intelligently instead convincing them to buy permanent life insurance, that would do a lot of good.
1) That's not how this business is structured. Unless you're selling services (like seminars or books) in money management, you aren't getting paid for that time. Yep, if I'm exerting labor, my time has value.
PS: Most adult education programs have budgeting and money management classes for really low cost. How many people do you think sign up?
2) Some people may change, most will not.
You don't like whole life, cool.
I completely understand what you're saying, but I don't view those people as potential clients.
They need to get their s**t together before focusing on income protection.
While some people may benefit from a "savings program", I don't want them as clients.
Even if the number is really large.
I've had people try to liquidate their accounts for the dumbest things: new kitchen, a 60k car for their kid, a condo in some 3rd-world country, and a whole bunch of other ridiculous stuff…
Again, it's their money so they can spend it how they want but it really makes a mess of their plan.
There are plenty of clients who are grounded and have decent financial plans that include insurance products who are out there to write.
Those who are relatively irresponsible make poor clients IMO.
I take the time to explain why permanent life is a terrible idea for them, and why they should buy term, and then setup an account with their bank to automatically deposit into a mutual fund each month. That takes about 90 seconds.
I don't get paid for it either, it actually loses me money, but helping people make good decisions is more important than lining my pocket.
I am guessing if you were to do that people would be better informed, their families would be better cared for, but that would mean less SCUBA trips for you, eh?
I would say a few things:
1) Whole Life, for me, is not for income protection. It's to get your butt in the ground. Income protection is a term product. It's okay, if you want, to lump that into term, but know you have to eventually cover the cost of your funeral.
2) My experience, lower income people need protection. If they're young and qualify for term, great. If they're older and need the product to be stable (since eventually ends) that covers one thing, there's a product for them too.
3) Term is a great product, but it's not an all solve solution.
There are clientele that doesn't work for… You can agree or not. However, I see your smugness. It's okay that because I believe (and own 5 small whole life policies on family members, and myself, that I never collected commission on) that whole life in the right situation serves a purpose, you don't agree. However, insinuating that I'm somehow taking advantage of people to JUST line my pockets… That tells me everything I need to know about you.
1) Agreed. But WL can also be used as a supplemental retirement plan if everything else is maxed out. I've put several family members into the ground in the last two years (not by my own hand…but paid for it). Funeral costs are not that expensive and in my market, not worth the cost for a WL policy used specifically for burial.
2) Sure they do…and I write a lot of DI/term plans on those folks. But my earlier point stands as I like them to be relatively organized and have a plan. Those folks don't normally need final expense plans since they've planned for the future.
3) Agreed.
[QUOTE="Markthebroker, post: 1320510, member: 77312"
I am guessing if you were to do that people would be better informed, their families would be better cared for, but that would mean less SCUBA trips for you, eh?[/QUOTE]
Not cool.
Not cool…he seems to be a good dude in regards to recommendations.
I totally agree with you. You deal with higher net worth clients. Everything you're saying 100% makes sense to me.
Every single one of my clients that meets with a life insurance agent ends up getting some wild song and dance about how they need to spend piles more money on permanent life insurance that they clearly don't need or want, that will hurt them and their endeavors. Fortunately most of my clients are smart enough to see through this, but not all.
Travis sounds like he would prefer to point someone into an expensive whole life policy that pays him commission, than point them towards term and an automatic deposit into a mutual fund or REIT like I do.
My job is to educate, advise, and provide solutions on insurance.
You're right, I'm not going to set up a mutual fund for them. I don't advise on investments. I don't want to be responsible for people being upset with dips in the market. You can say that people don't get upset with you, and that's great for you.
You're making some pretty broad assumptions about me based on absolutely nothing. It makes you look pretty crappy.
I think I've been pretty consistent that Term is a great product in the correct situation.
Not every situation is the correct situation.
There's this thing we do, it's called a needs analysis. Based on the need, we determine what program is the best for them, and the best company based on their personal situation. We present a solution. They agree and buy, or don't and need more information OR a new solution.
Like I said, framing a single idea that whole life does have purpose in insurance in the right situation into me cash grabbing tells me everything I need to know about you.
Bank of American owns $22 billion, JP Morgan Chase owns $11 billion and Wells Fargo owns 18 billion in BOLI assets as per their 2018 first quarter balance Sheets.
Mark the property casualty salesman ought to get on the horn and wake them up … maybe he could suggest a good mutual fund for them to invest in instead.
@Markthebroker do you have a life insurance license?
Yes I do.
You didn’t need to take a class in your state before they gave you the license?
You have your series 7 as well I take it?
Yes, I took life classes. I don't need a series 7 to tell people to buy term and invest the difference.
If whole life is such a "no-brainer" investment, why do life insurance companies have to pay such high commissions to sell it? What other investment out there pays commissions anything close to a whole life commission?
Generally you pay big commissions on things that are hard to sell, and lower commissions on things that are easy to sell. Car insurance, 15 to 20. House insurance, 20 to 25. Term life insurance, 80 to 100. Whole life? And whole life commissions are payable on a premium 6 to 10 times a term policy providing the same death benefit..
Then you should send all of your clients to me and I'll sell them whatever you tell me to do.
Most good agents will do the same if coming from a COI.
Otherwise, a thorough needs analysis is necessary and then if other options are required, the business is referred out the other way.
Just stop.
Whole life comp with a top carrier is a little more than half of what a top term carrier is.
Of course the premiums are larger for WL, but to say that WL comp is higher is disingenuous.
The premiums are simply larger.
How about some examples of those commission rates?
That's a very misleading statement. Final commissions on permanent life are much higher because the premiums are so much bigger.
I've never understood how investing, say a $200 difference, each month for the 20 or so years before the term renewal rate increase hits and the policy is dropped, suddenly grows to $1M or more. That would take a compounded annual rate of return of approx 70% minimum, excluding the effect an upfront commission charge compounds to over that same period, plus annual fees, etc.
Guardian, Massmutual, and the other big whole life carriers pay 55% on whole life. Lincoln pays 115% on 20 and 30 yr term. Several carriers pay 90% plus.
Whole life comp is MUCH lower than term or GUL for any major carrier.
I straight up said that in the comment you quoted…lol.
And what happens when you die 21 years down the road and your spouse still wants to live like a $200k/yr salary is coming in? That $ million is gone within 5 years. How will they live the remaining 30+ years in that same lifestyle?
Your math is so flawed I don't even know where to start. Are you implying that a permanent policy will allow a spouse to live a $200,00 a year lifestyle for 30 years? Do you say stuff like this in your life insurance pitches?
Good, we both agree you're being misleading. At least we agree on something.
Ok…I'll tell you all about commercial p&c and you can tell me all you know about life/health.
It will be a quick talk on both sides.
FWIW, I rarely recommend permanent insurance but ripping on comp in context of this conversation is stupidly off topic.
I added a little bit more than that to my rent, and then instead use it for a mortgage. Nevermind how I borrowed against and leveraged that home later, we can just focus instead on how much that home went up.
How?
These numbers aren't even close on the difference between term and perm.
I guess saying something is high commission is the same as high premium.
It's the other way around, then you're close.
To be absolutely fair, final expense pays 70-120%, depending on if it's GI and the company. Also, the average premium is around $50 a month.
Premium for Term is consistent.
Now, under 50 Whole life might his a different comm/premium structure. I don't really know.
I have heard of people doing what Ray is talking about, using it as an additional retirement savings account. I don't offer that, or do that. I just want to make sure people aren't forced to pass a hat, beg people for money, or do spaghetti dinners when they should be grieving.
I interviewed Anthony Martin at ChoiceMutual.com a few months ago. See the interview below.
They neither understand how life insurance commissions work, nor how life insurance, particularly whole life insurance works, which is why the work that those who understand is important.
I own term. I own whole life. Sure wish I would have listed to the agent who was trying to sell me the whole coverage amount as whole life. I made the mistake of asking my lawyer and a registered rep friend of mine for advice. In hindsight (knowing now but not knowing then) I got really bad advice from them and should have listened to my insurance agent.
Think about that, I asked a lawyer and a fee based asset gatherer for advice about life insurance. I may has well have asked the guy who sold me my car and homeowner’s policies because I would have gotten similarly bad advice.
Ahhhh so the rent money was money other than "the difference", which you added "the difference" to. Therefore the $M you mentioned wasn't strictly from investing "the difference" but rather "the difference" simply added to other money you were already investing. Sorry I misunderstood you to be suggesting that the $M was strictly from investing "the difference" only, when in fact, it only represented a small portion. The bulk of that $M came from money earned in a J-O-B.
If a WL policy is $230/mth and a term policy is $30/mth, that leaves a "difference" of $200/mth, which invested, would never amount to $M after 20-30 years……especially so in mutual funds. Your math is flawed.
I never said $200 a month turned into $1mil. You said that. You're a complete goofball. You and I both know that people make more money investing, than wasting their money on whole life. My friends and I have the money to prove it.
OK, these word games are giving me a headache.
I put my clients in the plan they chose. I answer questions, I ask questions, then I answer more questions.
I sat with a referred couple this yesterday. Super fit couple. They are looking at retirement in 5-10 years. They have a 20 yr old 30yr term and a WL/ADB combo they thought was all whole life.
Most likely going to out live the term policy. They want X amount of insurance till they die.
My recommendation = keep the term, it gets the youngest son to early 30s, replace the WL/ADB they thought was all WL, fn AIL, get two GULs, possibly short pay.
Two Sagicor GULs submitted. There was an option a few dollars less, but FU. They chose.
QUOTE="Markthebroker, post: 1320583, member: 77312"]You're being so foolish, you're making my head hurt. I will tell you once more how you're wrong, and then I'm done with you. You must be one hell of a salesman.
I never said $200 a month turned into $1mil. You said that. You're a complete goofball. That example with the wife living a $200,000 a year lifestyle made no sense either.
I've seen your type before. You'll make vague examples that don't add up and hope that somebody buys life insurance on the vague idea, and not the math.[/QUOTE]
Excuse me but did you not post the following?
Does that not imply that simply by investing the difference, they became millionaires???? If so, how does one become a millionaire strictly by investing the difference on a monthly basis over 20-30 years? What was that difference? At what rate of return could it turn into a million or more over that time period? I'd really like to know because I just might buy one of your investment offerings. No need to get snarky.
That ALL sounds reasonable.
What was the WL/ADB breakdown?
Do you think the agent who sold it, purposely misled them?
A life insurance salesman may have mislead them? Impossible. All the life agents I have come across on here are 100% honest and ethical. How dare you!
$11,299 WL $100,000 ADB. Which is not even what the original agent wrote.
I will start an American Income thread in the FE forum.
Yes.
<I fixed it for you>
Not all.
BTW, thier Financial advisor wrote the Term 20 years ago. He is reviewing their financial plan regularly. They say they wish they had done something different with the term years ago. The Term is with a company that no longer sells Life Insurance and the conversion option stinks.
98% of those licensed to do what we do don't know what they are doing with respect to what we do. I don't make any claim to knowing all, but I know enough to know when I don't know enough – and in those cases I seek help from those who do know.
I write a couple of financial advisors. They are life licensed. They are Termites. Which is fine. My guess is this gentleman is as well. He may believe that the term will get them to retirement and their other funds will make permanent life insurance moot. Again that is fine. However, They do not.
Every year I have clients terming out. 20 years goes by very fast.
Some say, " Wino thank you for taking care of us. However, we are pretty good and do not need the insurance any longer" Wino says " great, Send me the request to stop the bank draft, I will send you a summary of what that means simply reply that you understand and I will forward it to the company"
Others say "OH Shit!, What the %^[( am I going to do?!?" Wino say "Bubba, we need to have a talk"
Others may say they need/want $10,000 to $50,000 for final expense or transition money. Final expenses are not just dirt and a box. Also, transition needs is missed a lot. IMohsoHO
EDIT: ooops forgot the *
Would you care to guess WHY he wanted to purposely mislead them?
No one like it when I say this stuff.
I read this thread last night smh at your posts. You make it sound like investing the difference from a whole life policy leads to millions.
As you said your family "has millions as oppose to hundred thousands,"
You getting upset at him after making a blanket statement like that is laughable.
When I start the AIL thread in the FE forum I would guess the guys that run across them will echo what I think.
I have run across these guys a few times. It is almost always the same story. tiny amount of whole life and a large amount of 10-year term or ADB. I look up the agents and they were new when the policy was issued and out of the business shortly after.
As to why? It may just be a huge coincidence that we see the same thing over and over with them. Same with Bankers. Or is it training? I think these people are starving and under pressure to write apps. Any apps. So they go with a low premium and build it to look like a large amount of insurance. This premium mid $50s.
In this case the first agent was licensed about 10 months at the time of the app. Her license did not renew. She wrote the WL for $15,000 in Aug. He had had a birthday in July. ooops. A different agent (prob the manager) issued the policy. but changed the face to match the premium. hense the odd face amount. Now there is/was a different agent.
The client thought this was their Union insurance since "the Union sent them out" You know the " Mr Barney you have this free Union benefit …. just need to stop by for a signature." I wonder how they get the names and contact info of the Union members?
oh, oh, what started this – the newest agent stopped by to do a policy review with the Mr. They say now to the policy offer. The agent write the Mrs a $25,000 ten yr term for $25mo. She called her best friend. The friend said "I know a guy"
Here is what I showed them I could do:
$25,000 Thirty yr @ $12mo Or
$25,000 @ $25mo, non med, forever GUL
I hope she does not get paid on submission.
Wrote much larger policies on both but needed to first bludgeon the old agent with the wedge first.
It is this sentiment that causes most of the problems retired folks have. Financial planners focus on rate of return and "getting folks to retirement" but do very little to plan how to get them through retirement. And it is here that whole life insurance and fixed index annuities shine.
But once $100,000 or $500,000 or $1,000,000 in cash is placed in a whole life insurance policy, the management fees are gone. Folks focus on the commission agents earn on whole life sales. The insurance companies pay those commissions. But the series 7 guys get their fees and commissions from the clients principle.
I heard Tom Hegna say that when he talks to wealthy folks and asks them what their best performing investment has been, they often respond that it was their whole life insurance policy. Termites believe what they believe. But it is not based on math and science. It is based on … belief.
Who dat? 😉
These problems occur when you look at whole life as an investment. Whole life is NOT an investment. It is life insurance with investment like qualities that I personally believe have been over sold as such.
However if you look at whole life for what is (life insurance) and the added benefits that come with it, than you will see it differently.
Nevertheless, most individuals who are investors or manage investments cant turn that mindset off long enough to actually see the benefits of whole life.
The newest female agent. ////
[QUOTE="WinoBlues, post: 1320693, member: 5513"As to why? It may just be a huge coincidence that we see the same thing over and over with them. Same with Bankers. Or is it training? [/QUOTE]
Well, AIL is a Torchmark company. :yes:
I think WL can be defined as life insurance, while Term can be defined as premature death insurance. Only one of those offers a guaranteed payout. And, as stated, it also comes with added benefits.
I you buy a whole life insurance policy, and die a day later, where do you think the money for the death benefit comes from?
I agree that looking at whole life as an investment is dumb for most lower middle class (and below) families.
I also think term is just fine for someone younger. They have time to invest and weather fluctuating markets. Older people don't. Older people are sicker and can't always (until recently) qualify for term. The term GI is absolutely, 100% going to increase around every 5 years.
Most people that need FE would pay slightly more up front for a stable premium as they age.
That's what the Dave Ramsey's and "only term" people don't get. It's not a cash grab. It's also not being unethical. It's the marketplace.
I swear, I've been accused of a lot, mostly that I'm an arrogant dick or a know it all. I've never been accused of being a money grubber, dishonest or someone that takes advantage of people.
That's definitely something new.
To be fair, it'll likely be contested 🙂
That's certainly possible.
Let me help you out a bit, so we take that concern off the table.
If you buy a whole life insurance policy, and die in a car wreck a month after you take delivery, a car wreck that was not your fault, where do you think the money for the death benefit comes from?
Objection: Relevance!
Listen Perry, if you want to make a point just make it.
PS: Before you go down the road that I don't know. Let's just pretend that if I didn't, I was smart enough to take the time to go to Google and look it up . Either way, work with the premise that I understand how Insurance companies have cash to pay claims.
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That's what pro's do. So naturally I am not surprised.
Many agents and policyholder's never even think about conversion. Very helpful especially when combined with WP. If the PH is disabled and/or terminal conversion is more valuable than buying a term plan based on lowest premium . . . and assuming you will accumulate great wealth . . . but you didn't.
Back in the dark ages MONY and other Mutual's taught agents to sell the combo. Do the FNA/CNA and sell them the DB they need. Add a term rider (usually 20 or 30 year decreasing) to the WL base. Then go back and convert as much of the term as you can each year.
Worked well in theory.
Not so much in practice.
Once the rookie ran out of financing they were gone. Sometimes to another Mutual with a new financing deal.
More importantly, if you buy Term, and don't die prematurely, where do you think all those premium dollars go after you can no longer afford the renewal and drop the policy?
I saw something about the % of term policies that ever pay out being small.
It's tiny. Good thing too, given the very little that people are paying for term life insurance today.
A 40 year old male non-smoker can buy a $1,000,000 10 year term policy for as little as $324.
Do the math.
1,000,000 divided by $324 is 3,086. So the life insurance company needs 3,086 people to pay $324 just so it can collect enough money to pay one claim. Sorry guys, no commissions on this deal.
1 in 3,086. That mean 3,085 people didn't die. 3,085 term policies never paid a claim that year. Those people got ripped off.
Over 10 years, only 10 of the 3,086 people can die, or the life insurance company loses money.
So yeah, very few of those policies will pay a claim.
I'm pretty sure this is still not relevant.
What's your point? That's really why it's not relevant.
The insurance company needs money to pay claims? No $41?..
Insurance is the transfer of risk. In Term, if the risk doesn't happen, there's no payout. In whole life, the actuary evaluates the expectation of loss over the year and the company sets aside the claims pool to pay the expected losses.
The other money is invested and they take the arbitrage. Furthermore, they get new money for new policies sold.
Everyone doesn't die immediately after they get insurance. That transfer of risk over time is how the company stays solvent.
Most folks outlive their term coverage. Doesn't mean they outlive their need for insurance.
I agree. I'm not against term. I think it makes sense for a young family to carry term, especially until their kids are on their own.
That!
Or their Want of insurance.
Need or Want
In the last year I have written two different guys term plans that some would say is wrong.
Client 1 = age 75, sold a 15 year term.
Client 2 = age 65,sold a 15 year term.
I and them are good with that.
I don't think it's wrong. I think if you and the client agree that this is the best plan, it's right for them. A lot of people are 0/1 type of people. The best agents understand the clients needs, explain their options, and let them make an informed choice.
No, they didn't. During that year they got exactly what they paid for: Life insurance protection with a $1,000,000 death benefit.
The problem you have, and it is common to all "termites," is that you truly do not understand the nature of risk. Insurance protects against pure risks. The prote
This is like the traders and investors and registered reps who do not truly recognize (many do not recognize at all) that trading/investing in the market is speculative, involving speculative risks, and is therefore a form of gambling. The real question a trader should be asking is what is his or her edge. But they do not, they think only of ROI and rate of return, as they assume a positive outcome and are baffled when they lose money to the market.
But with respect to life insurance, so long as the insurance company stood ready, willing, and able to pay the claim then the client got everything that was promised by the contract.
I do not understand folks like you who have such apparent (and obvious?) disdain for the product hanging around a forum devoted its professional practitioners.
Marketing………….:biggrin:
OK, it was click bait. 🙂
C1 = Partner in a successful company. The 15 yr ONL term we wrote just termed out and the monthly premium guy went to $7,200mo. Owns his CA home but just bought a lot in Hawaii for a vacation / retirement home and wanted more than needed $500,000 protection for his wife. That piece of mind had more value than the premium.
C2 = a farmer with a very large farm. Has a couple large policies already. Wanted $1,000,000 for 10 years, he came in better than applied so for a bit more we moved him to 15 year. He wrote a check for the annual before I finished the app. The piece of mind was of more value than the premium.
Neither of these clients needed the coverage. They wanted it.
My point – people are always giving absolutes in this business. There are no absolutes.
BTW, both are seniors, both consider life insurance for final expenses. *
All IMohsoHO
I agree with what you're doing. It's a matter of what the client needs vs what neat box we have agents put them in.
Sometimes FE is the right option for seniors, sometimes term is…
+1 For Anthony saving my wallet from the 50 dollar salmon lol.
It will definitely be investigated but may or may not be contested…. I have not had them die the next day but did have a guy die of a heart attack on Saturday morning after I had taken his app on Thursday afternoon… American Pioneer investigated the claim and then paid it. Took about 6-7 weeks.
The fastest claim occurrence ended up being a waiver of premium claim instead of a death claim. Had a guy on a motorcycle hit by a train about 3 hours after signing the application.. I delivered the policy to his mother at the hospital ICU.. He was permanently disabled and the policy endowed for $25K a few years back.. He only had one premium invested..Beat that return with a mutual fund! 🙂
Everything, except becoming bazzillionaires by investing the difference!
Younger people can try to turn insurance into Amazon all they want, but what they don’t understand is there are a million different rules and regulations, and one false move on an application/plan selection, and they’ll be risking their financial or health future. 95% of people I talk to (of all ages) have absolutely ZERO clue about how insurance works, and then when they tell me they researched something, and have a plan/recommendation in mind, I usually laugh, because it isn’t possible (due to regulations), or it isn’t in their best interests. You can’t turn life/health insurance into Amazon or shopping for a car. It just isn’t going to work. Instant gratification/results just isn’t part of this business. That’s not to say some technology can’t be incorporated, but there has to be a common sense balance.