Did you know that not all life insurance policies were created with the same intention? No, I'm not referring to the difference between whole life insurance and term life insurance.
That's a pretty obvious difference.
What's less obvious is the difference that exists between different whole life insurance policies. And that complexity actually exists on two levels.
That being said, there's a certain degree of creativity and knowledge that a competent agent must possess to make a policy hum…if the intended goal is to maximize the return on cash.
There is a coordination of rules that come into play. Each company has its own internal rules/guidelines as to what they allow and the various regulatory agencies also have rules. We have to be aware of both.
You would assume that any life insurance agent that comes knocking on your door would understand how this all works…right?
We wish that were the case. If it were, we'd see a whole lot less policies that were poorly implemented. We'd also see a lot fewer unhappy people that have watched many thousands of dollars evaporate to pay for things they didn't want.
What you will find out when working the typical agent (one who doesn't have a real working knowledge of policy design) is that they can't adequately explain how it all works.
I know it's all to popular in the insurance industry to adopt a “I don't build'em, I just fly'em” sort of bravado. That's okay for some things. I don't really need to know how a pair of Alden shoes are built down to the cork bed insole.
I can accept the fact that they last a long time, wear incredibly well, and are easily restored by the manufacturer.
But I'm only going to shell out a few hundred bucks for them.
However, when you're talking to someone who's thinking through a multi-year commitment of $50,000 per year going into a life insurance policy, there's a chance they're going to have some questions about the details.
That's not unreasonable. It's a decision that should be deliberated a bit and more than anything, you (the client) should feel comfortable with understanding that you're making the best decision for you.
The Example We Mention in the Episode
I hope you'll listen to the entire episode to hear more of our commentary. As usual, we're not at a loss of things to add to this conversation.
If you think we may be able to help you, please contact us, we're more than happy to hear from you.
Brantley is a practicing life insurance agent and has been for nearly 18 years. After years of trying to sell like his sales managers wanted him to, he discovered that people want to buy life insurance if you actually explain the benefits.
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IPB 105: Is Indexed Universal Life Insurance Worth it even if the Interest Rate Assumptions are Wrong?
IPB 104: You Can Just Buy Bonds: One of the Reasons Not to Buy Whole Life Insurance
IPB 103: Why Does the Life Insurance Industry Suck at Marketing?