In this age of instant online term life quotes featuring simplified issue, “no medical exam,” “affordable” term life insurance policies, sometimes it’s easy to overlook the obvious counter to someone spooked by the “hassle” of going through the full underwriting process, including a paramed exam.
Simply explain to them why it is in their best interest and will typically save them a lot of money in premiums.
This back-to-basics idea was mentioned and explained by Genworth National Director of Index Products Charlie Gipple, CLU, ChFC, during a panel discussion at last week’s NAFA IMO Summit in Scottsdale.
Discussion in the session, “Adding Life to Your Annuity Sales,” centered on the types of tools that are available to help producers facilitate a sale. While making efficient use of newer technologies was mentioned as a key method to achieve growth, Gipple also made a compelling case for the value of explaining to your prospect why a fully underwritten life insurance policy is their best bet to secure the best coverage at the best rate.
The whole purpose of underwriting is to see if you can get a “discount” on your premiums due to your good health and habits, Gipple told the NAFA audience. Not to penalize them.
“Tell them, we can get you a guaranteed issue product right now, but you are going to pay a premium for doing that. If you go with underwriting, we can get you either more coverage or lower premiums,” Gipple said.
He also said to ask the prospect, if you were going to lend your neighbor $2 million, you would want to do some due diligence first, would you not? Explain that that’s what the insurance company wants to do – make sure you are not a bad risk.
While guaranteed issue is often thought of as the only way someone with existing health problems can find coverage, think about the type of people who opt to go with simplified issue products – perhaps doing so simply because they don’t want the hassle of full underwriting and/or a medical exam.
Many of these people would benefit greatly from full underwriting – they just need to be made aware of why this is the case. Yes, simplified issue will have far fewer questions and sidestep the invasive tests the come along with a standard life insurance exam, but a healthy person needs to know that simplified issue leads to unnecessarily higher premiums.
• How do you educate prospects about the advantages of full underwriting? Please share your tips and check out tips from others on this new thread.
• You may also be interested in: 6 things not to say when selling insurance