After we published the no contest between whole life and term life insurance article a few weeks ago many of you apparently found a side comment I made very intriguing. We’ve received more emails asking about our typical clients than any other subject since that article went live.
I’ve resisted writing this post for years. My aversion stemmed from a desire to be open to all and I want to stress that I still feel that way.
However, inquiring minds want to know about our “typical” client and I suppose in many respects it makes sense to identify who exactly we’re talking about when we discuss the subject of insurance specifically speaking to life insurance as an asset class. So here goes…
Our typical client is much younger than most of my colleagues would have guessed. Mathematically the mean age is 41, but there is a healthy number of 30 somethings in that data set and a large group of people beyond age 50. Mean personal income (not family income) is well into the six figures and mean networth (excluding primary residence) is well into the seven figures.
Top five professional categories of our clients are:
If we ranked the top five by the size of business (i.e. incoming premiums) the categories change slightly:
This is due largely to some large cases we’ve written for clients who work in the investment and IT industries. Medicine, though, certainly represents a decent percentage of premiums written and the top three categories make up roughly 85% of all business.
Top five states ranked by total clients are:
States rank the exact same for case size breakdown.
California represents more business than the next two states combined. It’s also the largest source of website traffic and the numbers are disproportionate to the underlying population percentages by U.S. states.
In addition, site visits from people who live in San Francisco is disproportionately higher than other California cities given underlying populations. We suspect this has something to do with San Francisco’s higher concentration of tech-minded individuals and our being an online resource for insurance information.
70% of the business we write is newly purchased life insurance. Though a large percentage of that 70% (roughly 85%) comes from people who have been reviewing a few different proposals and come to us for guidance.
The majority of replacements are poor performing and poorly designed whole life insurance policies. Often times these whole life policies were sold by an agent who pitched the client on using the whole life policy as a personal bank.
We’re evenly split between the two products in terms of premium. By policy count, we generally place a higher number of whole life insurance contracts in force. The whole life cases tend to be smaller than the universal life insurance cases. However some of our largest cases ever written have been whole life insurance.
The breakdown of cases we typically write in descending order are:
The top two categories above represent about 96% of all business we write. Almost all of the cases we write involving term insurance, disability insurance, and long term care insurance are additional purchases made by an already existing client.
Our clients tend to be financially sophisticated and extremely inquisitive analytical types–the same people most insurance agents’ sales managers tell them to avoid. We don’t mind the questions–in fact we love them.
It might take a little more time and it certainly keeps us on our toes, but we truly appreciate the high level of discourse most of our clients force us to have with them.
In fact, a large percentage of our clients (I’ve never tried to count exactly how many) comment on their decision to work with us versus the person they started out with and this decision is often driven by our ability and willingness to discuss the deepest details of life insurance mechanics with them.
We have certainly enjoyed the journey so far. We look forward to all the people out there we have yet to meet. And we of course can't thank enough the awesome clients that we do have.
We do all of this for you and we are forever appreciative of the amazing support you've given us through the years.
Brandon launched the Insurance Pro Blog in July of 2011 as a project to de-mystify the life insurance industry. Brandon was born in Northern New England, and he currently calls VT home. He attended Syracuse University and graduated with a triple major in Economics, Public Administration, and Political Science.