We have Health Insurance 101 and Group Health Insurance 101! Personally, I would love to see a Life Insurance 101 thread.
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[COLOR=#000066]"Tell me and I will forget. Show me and I will remember. Involve me and I will understand." Confucius
It would be great. I am new enough I could use to learn more about life insurance, both product and marketing. I'm sure someone that has disagreed with me on an issue will make a smart-ass comment about that last sentence, but it's a good idea nonetheless.
It would be great. I am new enough I could use to learn more about life insurance, both product and marketing. I'm sure someone that has disagreed with me on an issue will make a smart-ass comment about that last sentence, but it's a good idea nonetheless.
Well it would be helpful if you narrow it down just a tad. Is it marketing or product that you would like to discuss.
If it is marketing then lets start with what you want to sell. Since Term is the basic default today I think I'll start with that.
I'm a strong believer in keeping it simple, so let me ask you this. What interest you the most, marketing to individuals or businesses?
It would be great. I am new enough I could use to learn more about life insurance, both product and marketing. I'm sure someone that has disagreed with me on an issue will make a smart-ass comment about that last sentence, but it's a good idea nonetheless.
Well it would be helpful if you narrow it down just a tad. Is it marketing or product that you would like to discuss.
If it is marketing then lets start with what you want to sell. Since Term is the basic default today I think I'll start with that.
I'm a strong believer in keeping it simple, so let me ask you this. What interest you the most, marketing to individuals or businesses?
I agree with both of you. Personally, I would like to know what life ptoducts produce the best results with small business owners. I like the simplicity of term, but iimagine that it is not for everyone.
I am set to go for health, but need to know about the life side. Is it best to become appointed with each individual company or through a brockerage firm. I plan to focus on health for a long time, but would like to incorporate life later down that road.
Well it would be helpful if you narrow it down just a tad. Is it marketing or product that you would like to discuss.
If it is marketing then lets start with what you want to sell. Since Term is the basic default today I think I'll start with that.
I'm a strong believer in keeping it simple, so let me ask you this. What interest you the most, marketing to individuals or businesses?
Well, forgive me for stating the obvious we all know, but the policy features and drawbacks are married to the marketing. We all need to know, or learn, what appeals to what situations and then the best way to approach such prospects. Ultimately, I am wanting to know how I can simultaneously make a good income and improve the financial situtation/security of others. I think the small business walk & talk market is going to be the one I hit the most, initially. And, to be honest, I don't offer term that is really price competitive, except for one 10 yr. product, so I am looking at good applications for permanent (WL, UL, VUL, VL, etc.) policies.
Well, forgive me for stating the obvious we all know, but the policy features and drawbacks are married to the marketing. We all need to know, or learn, what appeals to what situations and then the best way to approach such prospects. Ultimately, I am wanting to know how I can simultaneously make a good income and improve the financial situtation/security of others. I think the small business walk & talk market is going to be the one I hit the most, initially. And, to be honest, I don't offer term that is really price competitive, except for one 10 yr. product, so I am looking at good applications for permanent (WL, UL, VUL, VL, etc.) policies.
Well then you should consider using the "5 Way":
Dear Blankity Blank, one day you will be out of business one of 5 ways,
1)Death
2)Disability
3)Retirement
4)Voluntary Sale
5)Bankruptcy
Now I'm here to offer you a solution that no matter how you leave you leave with the largest amount possible. Would tomorrow at 10 am or Wed. at 1:00 PM be better for you?
That is about all there is to it. Or you can try what others here have suggested. Walk in and ask them if they want any insurance and what flavor they would like today. Of course I don't think that'll get you very far but, who knows? I've never tried it their way.
1)Death
2)Disability
3)Retirement
4)Voluntary Sale
5)Bankruptcy
Obviously the first three is a no brainer, yet how can you help with Bankruptcy and Voluntary Sale?
Bankruptcy or Asset Protection.
Voluntary Sale? This is one many ask how I can help with that, what gives your business or company value? People, retention of good people is a large problem for all companies even small business. So if I can add value to your employees (key employees) and tie them to the company such with Health, Life with Cash Accumulation then your company is worth more, as in a higher worth on the bargaining table.
James, I know you've defended perm coverage in the past. What other common uses do you see for permanent policies?
For any circumstance that insurance is needed. Yet the permanent insurance in the business world does provide stability over a undetermined future of any business. Rush Limbaugh signs a 24 million dollar contract, what is the first thing Clear Channel (whomever) do? They go out and insure him for 24 million and guess what kind of insurance they use? It was W/L and I believe Mass Mutual wrote the contract, now why did they use W/L? Because its the cheapest thing out there today! That may sound strange but it is very true. You may attempt to say Term is cheaper but that simply isn't true, at least most of all large contracts are backed up with Permanent coverage, I suppose these super size businesses like to throw their money away?
Ps Rush's contract is ten (however many) years, that even makes the idea of why not use Term even more intriguing to some, yet the bean counters obviously choose W/L with MM not known for being the cheapest out there!
I've posted this before and I'll post it again. Within 30 years I have a mortgage to pay off, other revolving debt and a son to put through college. My long-term savings are also still in the growing stage.
After 30 years I have no mortgage, son's already through college, and long-term savings are very significant. I'm failing to see the reason I need life insurance past 30 years from now. And I won't have enough money in my estate to qualify for the death tax, so let's forget about that argument.
I've posted this before and I'll post it again. Within 30 years I have a mortgage to pay off, other revolving debt and a son to put through college. My long-term savings are also still in the growing stage.
After 30 years I have no mortgage, son's already through college, and long-term savings are very significant. I'm failing to see the reason I need life insurance past 30 years from now. And I won't have enough money in my estate to qualify for the death tax, so let's forget about that argument.
And by the way, what would the cash value of a perm policy be at age say 85? When I run illustrations I see the cash value nose-diving after a certain age is reached.
So lets be a little bit more argumenative, say you walk into a business, lets say John's business. He is a Insurance Agent that does mainly health insurance and he is now 55 with two grown children. Child A is following in his daddy's footsteps and actively in the business of writing health insurance but child B is off in India serving in the Peace Corps and says Insurance is a part of the evil western white man's dominance over the world tyranny, another words a flaming liberal bent on hell to destroy capitalism but, John loves child B dearly.
Okay, now John ole boy is dead set against permanent coverage but he worried about his children. While John is now worth maybe a million and in ten or twenty years he's worth 2-3 million so he is taken care plus his loving wife and they plan on living the good life so they don't know exactly how much will be left at their passing. Now he looking at child A and sees that child A is the obvious child to leave the business too, now his business is worth around 4 million as John has a Agency with writing agents under him and the market value of his business is around 4 million lets say. He knows since Child A and B don't get along well, so he has to protect child B, how does he do it? Well there is several ways, sell the business, make Child A take out half of what the business is worth in this case 2 million and give it to child B but that isn't a good solution as for it would likely put Child A in great debt as he takes over the business at John's death.
So now you come in and offer the W/L solution to John. Buy 4 million W/L and make child B the beneficiary and all is equal! Yet the benefits don't stop there. Since likely John would do a major dump of money as in a one or ten pay W/L or whatever product cough cough UL John as the owner will have control of the Cash Value. He can also change up beneficiaries at any time if new circumstances come down the line as if Child A does something really stupid as John and wife is off on a carrier paid vacation or seminar. Now John might come back and say wait, how about some Term? Well John you answer, you're 55, best case I can get you ten years of term maybe twenty, so are you planning on dieing by the age of 65 or 75? Now for a 55 year old to buy a 20 year policy if you find a company willing, would make the price that near of W/L, plus no cash value built in and limited changes outside of the beneficiary can be made once placed. As in a good W/L or UL you can make changes, such as in the DB plus to pay out as in option A, B or C. Plus if you need to increase or decrease the DB it can also be done easily if you pick the correct contract at the start.
No W/L or a good UL is a worthy tool not easily outdone by any other financial vehicle out there.
And by the way, what would the cash value of a perm policy be at age say 85? When I run illustrations I see the cash value nose-diving after a certain age is reached.
If I'm not mistaken, the life insurance companies for perm life simply do what I do - they invest the money. Ok....but I can do that. To me it's not rocket science - I pay $400 or so bucks a month for perm life, the life insurance company invests the money and I build value. Oh - duh, that's what do on my own except I have infinitely more control over my investment choices.
The problem with BTID is no one actually does it - they piss away the difference. But if you actually do it you can desimate the returns any perm life policy will give you.
Saying that, if you don't have the discpline to invest then you're all over perm life.
If I'm not mistaken, the life insurance companies for perm life simply do what I do - they invest the money. Ok....but I can do that. To me it's not rocket science - I pay $400 or so bucks a month for perm life, the life insurance company invests the money and I build value. Oh - duh, that's what do on my own except I have infinitely more control over my investment choices.
The problem with BTID is no one actually does it - they piss away the difference. But if you actually do it you can desimate the returns any perm life policy will give you.
Saying that, if you don't have the discpline to invest then you're all over perm life.
So lets be a little bit more argumenative, say you walk into a business, lets say John's business. He is a Insurance Agent that does mainly health insurance and he is now 55 with two grown children. Child A is following in his daddy's footsteps and actively in the business of writing health insurance but child B is off in India serving in the Peace Corps and says Insurance is a part of the evil western white man's dominance over the world tyranny, another words a flaming liberal bent on hell to destroy capitalism but, John loves child B dearly.
Okay, now John ole boy is dead set against permanent coverage but he worried about his children. While John is now worth maybe a million and in ten or twenty years he's worth 2-3 million so he is taken care plus his loving wife and they plan on living the good life so they don't know exactly how much will be left at their passing. Now he looking at child A and sees that child A is the obvious child to leave the business too, now his business is worth around 4 million as John has a Agency with writing agents under him and the market value of his business is around 4 million lets say. He knows since Child A and B don't get along well, so he has to protect child B, how does he do it? Well there is several ways, sell the business, make Child A take out half of what the business is worth in this case 2 million and give it to child B but that isn't a good solution as for it would likely put Child A in great debt as he takes over the business at John's death.
So now you come in and offer the W/L solution to John. Buy 4 million W/L and make child B the beneficiary and all is equal! Yet the benefits don't stop there. Since likely John would do a major dump of money as in a one or ten pay W/L or whatever product cough cough UL John as the owner will have control of the Cash Value. He can also change up beneficiaries at any time if new circumstances come down the line as if Child A does something really stupid as John and wife is off on a carrier paid vacation or seminar. Now John might come back and say wait, how about some Term? Well John you answer, you're 55, best case I can get you ten years of term maybe twenty, so are you planning on dieing by the age of 65 or 75? Now for a 55 year old to buy a 20 year policy if you find a company willing, would make the price that near of W/L, plus no cash value built in and limited changes outside of the beneficiary can be made once placed. As in a good W/L or UL you can make changes, such as in the DB plus to pay out as in option A, B or C. Plus if you need to increase or decrease the DB it can also be done easily if you pick the correct contract at the start.
No W/L or a good UL is a worthy tool not easily outdone by any other financial vehicle out there.
This happened to one of my best friends who owns a Pepperidge Farm franchise. His father gave him the franshise while he was living but the father also had three other kids. None of the other kids at the time were remotely intersted in running the business when the father wanted to retire - only my friend. A family meeting was called and it was agreed upon that the father was giving the business solely to the only son who wanted it.
Year later the father passes away. But the father didn't have any life insurance, only a small house. So now the other kids come to realize that the only major asset their father had was the business - which was now legally solely owned by my friend. That didn't stop the other kids from initiating legal action to have the business sold and the money split - saying it was a part of their father's estate.
Luckly it didn't spent an hour in court. The father legally sold the business to his son and after the sale it was at that point no longer a part of the father's estate. So the rest of the kids were ass out.
But you have a good point - except I only have one kid:-)
If I'm not mistaken, the life insurance companies for perm life simply do what I do - they invest the money. Ok....but I can do that. To me it's not rocket science - I pay $400 or so bucks a month for perm life, the life insurance company invests the money and I build value. Oh - duh, that's what do on my own except I have infinitely more control over my investment choices.
The problem with BTID is no one actually does it - they piss away the difference. But if you actually do it you can desimate the returns any perm life policy will give you.
Saying that, if you don't have the discpline to invest then you're all over perm life.
A good W/L contract is expected to perform in the 5-6% range, now you may or may not beat this in any time lenght, of your choice. There is no degree of certainity in life as what makes W/L desirable to many. Now all of this is tied to a DB that is expected to pay out but when is the big question. In other words you can't take the CV side away from the DB side, they are tied together.
Life Insurance 101
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