Ten Things Life Insurance Agents won’t Say: #2 We’d Rather Sell you Investments

Moving right along on our critique of Market Watch’s failed attempt at a slam piece against insurance agents from a few months ago, today we take on item #9.

Apparently insurance agents find insurance dreadfully boring. So boring in fact, that they’d much rather talk to you about “investments.” And, much to their delight, federal legislation that came about in 1999 opened up the flood gates allowing agents to rush to the market with savings focused life insurance products—because it’s not like they’d been doing this for over 100 years with whole life insurance or anything.

Complaints Oh My!

Apparently this new old found glory was all fun and games until someone decided to complain. Believe it or not, insurance agents are the only band of financial services salespeople who faced complaints for product performance in the last 10 years.

This stems mostly from the fact that insurance agents are the only financial services salesforce that never explains their products to the buying consumer. life insurance agent

But fear not, the industry adopted new suitability standards to protect the easily persuaded consumer. These new standards protect the buying public by requiring so much paperwork be filled out to buy an insurance product that agents can’t physically sell enough policies to hurt a significant number of people—not to mention the downtime they face while on the mend from carpal-tunnel. I guess if you’re going to go after those bigger commissions found in the “investment” products, it’s a small price to pay.

Thing #9 finishes with advice regarding length of service (determined by licensure in a specific state) an agent has under his or her belt. The suggestion is that the longer the agent has been licensed in your state, the longer the potential paper trail for his or her good or bad behavior.

Great in theory, but as someone who has assisted in the initiation of Department of Insurance (DOI) complaints against agents and brokers who truly do bad things to their former clients I can attest to the fact that one nearly needs to kill someone or at least punch them in the face and steal their wallet before they end up logged in the DOI database for bad behavior.

In fact, facing a lawsuit and having a judgment won against you by a client doesn’t necessitate entry into the folks with bad behavior roster with many state’s insurance departments. We’ll revisit this with thing #4, where Mr. Goldstein just might have gotten one thing right.


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