Simplified Issue or Fully Underwritten?

[insuresu]

Whenever and if ever possible, I prefer to write a simplified issue policy rather than a fully underwritten policy for a few reasons:

1. Most importantly, it protects the client's insurability
2. The chances of the client being approved as applied for is about 90%, much higher than what it is for fully underwriten
3. No paramed or medical exam, blood & urine tests, or swabs
4. Policies are issued quickly, usually within a week, sometimes within 24-48 hours
5. Client is happy
6. I get paid quickly
7. I'm happy
   
   Yes it's true, the premiums are usually a little higher but if everyone is happy, what's the problem?
   
   Besides, once approved there's nothing wrong with shopping for a better premium afterward. Even if something is uncovered via MIB or otherwise, once the policy has been issued and there was/is no fraud involved, the client is protected. The issued policy cannot be taken away.
   
   On the other hand, if someone applies for a fully underwritten policy and is declined or rated, that is automatically entered into the MIB. The client is scarred for life by that information.
   
   Anyone want to comment?

 

[WinoBlues]

Whenever and if ever possible, I prefer to write a simplified issue policy rather than a fully underwritten policy for a few reasons:

1. Most importantly, it protects the client's insurability
2. The chances of the client being approved as applied for is about 90%, much higher than what it is for fully underwriten
3. No paramed or medical exam, blood & urine tests, or swabs
4. Policies are issued quickly, usually within a week, sometimes within 24-48 hours
5. Client is happy
6. I get paid quickly
7. I'm happy
   
   Yes it's true, the premiums are usually a little higher but if everyone is happy, what's the problem?
   
   Besides, once approved there's nothing wrong with shopping for a better premium afterward. Even if something is uncovered via MIB or otherwise, once the policy has been issued and there was/is no fraud involved, the client is protected. The issued policy cannot be taken away.
   
   On the other hand, if someone applies for a fully underwritten policy and is declined or rated, that is automatically entered into the MIB. The client is scarred for life by that information.
   
   Anyone want to comment?

1. 
   
   What percentage of your SI do you send in as FU after the SI is issued?

 

[insuresu]

I don't have an exact percentage but it's very low. I will guess about 5%. I have found that by addressing the issue up front is best. I explain the difference. Most people like the idea of simplified issue. I also offer to come back to them later and see if we can improve on what they have. It gives me the opportunity to stay in touch and be of service. If it's more than a year later, it can also mean additional new commission if it is a term policy. The same can be said for permanent policies, but that's usually not in the client's best interest but you never know.

 

[WinoBlues]

I don't have an exact percentage but it's very low. I will guess about 5%. I have found that by addressing the issue up front is best. I explain the difference. Most people like the idea of simplified issue. I also offer to come back to them later and see if we can improve on what they have. It gives me the opportunity to stay in touch and be of service. If it's more than a year later, it can also mean additional new commission if it is a term policy. The same can be said for permanent policies, but that's usually not in the client's best interest but you never know.

So you routinely steer them to the higher comp policy then a year later offer them what you steered them away from a year earlier. But on permanent iitmay not be in their best interest?

 

[GreenSky]

So you routinely steer them to the higher comp policy then a year later offer them what you steered them away from a year earlier. But on permanent iitmay not be in their best interest?

That's much easier than actually helping a client, isn't it?

You also get paid much faster on SI and at a higher rate. Then in a year if you re-write it you can make even more money.

And you see this as a problem?

Rick

 

[insuresu]

I don't steer. I present. If it works for both of us, I see no problem. In the case of permanent insurance, even if the premium is lower, they will have lost a full year. As I assume you know, it takes time for a policy to accrue significant cash value (CV). If it's in their best interest to switch them, it's better then than later. It's not up to me. It's up to the client. I hope that helps.

 

[Glen Shelton]

Whenever and if ever possible, I prefer to write a simplified issue policy rather than a fully underwritten policy for a few reasons: [*]Most importantly, it protects the client's insurability [*]The chances of the client being approved as applied for is about 90%, much higher than what it is for fully underwriten [*]No paramed or medical exam, blood & urine tests, or swabs [*]Policies are issued quickly, usually within a week, sometimes within 24-48 hours [*]Client is happy [*]I get paid quickly [*]I'm happy Yes it's true, the premiums are usually a little higher but if everyone is happy, what's the problem? Besides, once approved there's nothing wrong with shopping for a better premium afterward. Even if something is uncovered via MIB or otherwise, once the policy has been issued and there was/is no fraud involved, the client is protected. The issued policy cannot be taken away. On the other hand, if someone applies for a fully underwritten policy and is declined or rated, that is automatically entered into the MIB. The client is scarred for life by that information. Anyone want to comment?

^^ Pretty much my exact argument for SI policies.

 

[Tahoe Ray]

Yes it's true, the premiums are usually a little higher but if everyone is happy, what's the problem?


Anyone want to comment?

What is your definition of "a little higher"? 10%? 15%?

 

[GreenSky]

What is your definition of "a little higher"? 10%? 15%?

The commission is usually 20-30 pts. higher. So it's only "a little higher."

Rick

 

[sman]

The commission is usually 20-30 pts. higher. So it's only "a little higher." Rick

And let's not forget, the premium can be "a little higher" as well.