Shopping on price alone.
Too many people think term insurance is all the same. Quality term insurance is harder to find, and fewer advisors understand why their client may want to have some. In my experience, life doesn’t always go as planned and therefore adding options and flexibility to the planning process can turn out to be a wise decision later. Knowing what happens at the end of the fixed rate stage is important. There are three outcomes:
- The policy will end. (rare)
- The death benefit will drop drastically. (happening more)
- The annual premium will increase exponentially. (most common)
If your client has had some health changes since purchasing their term insurance and still wants to maintain coverage after the fixed rate stage, this is when the conversion options become important. Launch the below link to learn more.
Commoditization makes quality term life insurance harder to identify.
Where should clients shop?
The most common way people obtain life insurance is via their group insurance plan at work. This is certainly a convenient way to get coverage, but the reality is healthy clients are subsidizing the unhealthy clients. The healthier and younger your client is, the more it makes sense to have anything above the basic employer portion which the employee pays to be a personal policy. This will often be a better priced purchase in the long run, adding control, flexibility, and additional benefits not available with group term.
Integrated Insight™ – Group vs Individual Term
Where are your clients shopping?
As the marketplace continues to evolve, finding a “Life Insurance” professional is harder as fewer are available. “Online” and “direct to consumer” sources can help, but there are many limitations and misunderstandings of what these services provide. It is important for clients to learn a little more about life insurance to help them determine what type of term to buy. Asking the right questions and providing further education to the client is important.
Our Right Fit Term™ Insurance Insight can help educate and ask additional design questions.
It takes good health and money to buy life insurance.
The first step in our process is to thoroughly screen a client’s health. This is where many of the “online” and “direct to customer” companies fail. They don’t ask enough detail, or they don’t offer enough carriers to find the right fit for each client. As a longtime insurance broker, a client’s health often directs me to the Right Fit™ carrier(s). Underwriting is not equal and today more than ever there are health challenges for all ages. Marijuana usage, anxiety and depression, build, specific health conditions, and even family history are looked at differently by each life insurance company. Our experience and access to the carriers help us direct clients to the best options based upon their desired coverage. This is why our process starts with prescreening a client’s health.