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Over the past year I have been examining an area of my practice.....term insurance cases, where the likelihood of term conversion "seems to be pretty low". Over the last six years I have not been as business-smart as I should have been, writing all my term through my main mutual relationship thinking that, I'll take half the comp because everyone will eventually convert to permenant right? Well, in looking at my current client mix, as well as my current overhead, I have come to the conclusion that:
a) only a small percent of term ever converts to permanent, and
b) for term cases where conversion isn't important i need to utilize a company where it is easy, quick, and the comp is good.
I haven't changed my beliefs one bit-if conversion is a sure bet, I will take half the comp and write the term coverage with a highly ranked mutual (Mass Mutual, Guardian, or Penn Mutual) becuase of the great permanent line-up these company's offer. However If I have a 30 year old male who needs $1,000,000 of level 20 term, the $380 of comp this case generates through Mass Mutual will not even pay for my time, staff, office space, and general overhead of actually writing the business.
I know there are financially stable company's like Assurity that will let you do "e-apps" (three times as quick as Mass or Penn's traditional underwriting process) and with the same identical annual premium as the Mass example above, the comp is around 2 1/2 times more at roughly $950.
What are your thoughts and who do you guys like based on these thoughts?
a) only a small percent of term ever converts to permanent, and
b) for term cases where conversion isn't important i need to utilize a company where it is easy, quick, and the comp is good.
I haven't changed my beliefs one bit-if conversion is a sure bet, I will take half the comp and write the term coverage with a highly ranked mutual (Mass Mutual, Guardian, or Penn Mutual) becuase of the great permanent line-up these company's offer. However If I have a 30 year old male who needs $1,000,000 of level 20 term, the $380 of comp this case generates through Mass Mutual will not even pay for my time, staff, office space, and general overhead of actually writing the business.
I know there are financially stable company's like Assurity that will let you do "e-apps" (three times as quick as Mass or Penn's traditional underwriting process) and with the same identical annual premium as the Mass example above, the comp is around 2 1/2 times more at roughly $950.
What are your thoughts and who do you guys like based on these thoughts?
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