Debit Routes - Independent Agent Review

[mudhound]

ran one for 7 plus years my self. Not out one dime!
However, I did do one audit. Gosh darn. The guy was into the money for over 7G's
Far as i know he paid it back. Had one other audit i was a part of. Same result.

 

[rousemark]

You’ll want to be cautious if policies have loans that the client doesn’t remember taking out. That may mean they’ve missed premiums along the way. To keep them from lapsing the policy, their agent had them sign a loan to pay premiums. If they’re poor payers, you might be writing yourself a chargeback.

I’ve heard the horror stories, too, about agents forging signatures on loan forms, depositing loan checks into their own account, etc. But I haven’t encountered that in quite awhile. It’s much easier to catch these days, so agents don’t get away with it like they used to.

The loan could be the result of an automatic premium loan. The request for that is made on the application and the client probably doesn't know or remember that that box was checked when they applied.

 

[shonceman]

The loan could be the result of an automatic premium loan. The request for that is made on the application and the client probably doesn't know or remember that that box was checked when they applied.

Right. Some companies do allow APL. LBL (debit) doesn’t, and the last company I was with (Reliable/Kemper) before becoming independent didn’t either. It seems like I remember that AGLA did. But I left them 16 years ago, so my memory’s a little fuzzy on that.

 

[bboman23]

The loan could be the result of an automatic premium loan. The request for that is made on the application and the client probably doesn't know or remember that that box was checked when they applied.

The debit I was running did not have APL as an option. The agent had Premium Loan forms. I knew of agents that would get a client to sign SEVERAL up front and not date them. He would tell them to just call him if they ever needed to skip and he would just submit a form and not have to come by their house.

These clients put a lot of trust into their debit agent and in most cases, it works for them due to the agent being a trustworthy agent. That was not always the case though. I have seen COUNTLESS audits where the book was several thousand behind.

 

[shonceman]

ran one for 7 plus years my self. Not out one dime!
However, I did do one audit. Gosh darn. The guy was into the money for over 7G's
Far as i know he paid it back. Had one other audit i was a part of. Same result.

When I first became a staff manager, the district manager realized that I was pretty good at spotting agents who were in the book. He started having me ride with other managers’ agents who he suspected. I found several in the book for between a few hundred dollars up to a few thousand dollars. None of them ever started out to embezzle money. They only meant to borrow it for a week or two, but kept getting deeper and deeper.

My manager told me it’s almost always one of three things: women, drugs, or gambling. But I also found agents “dipping” who just ran short and needed money for a big bill, or gas money, etc. Or they’d keep Mrs. Jones from lapsing by borrowing from Mrs. Smith’s advance. Then when Mrs. Jones lapsed anyway, well....Mrs. Smith wasn’t paid ahead anymore!

After about 15 years in the business I went to work for a buddy who was a former agent of mine who was staff manager at another company. Soon after I got there, I happened to notice one of the veteran agents on the staff hovering over his collection report in a way that made me suspicious. I didn’t know him at all, but I told my buddy that he should check the guy’s book. Of course, he knew my reputation for being able to spot those problems, so he rode with him the next week. The guy was sure enough into the book for a few grand. The heartbreaking thing about it was that he’d been working on that same agency for 29 years, and was apparently a good agent up to the point he started “dipping”, only to be terminated for theft.

 

[shonceman]

Thankfully, these days technology and systems exist that can quickly spot agent theft and other problems, so it’s much, much more difficult for bad agents to get away with it.

 

[TripleH]

I’ve had debit clients borrow money for all kinds of reasons. They might need dental work, or a car repair, etc. I had one client who would take out a loan every year right before Christmas. Then she would start paying in it in January and have it all paid back by the time she needed the next Christmas loan. It was the debit version of a “Christmas Club” account!

My debit clients are all pretty aware of the availability of policy loans. Sometimes they even ask me during the presentation whether this is a policy you can “borrow against”. But I always try to talk them out of taking a loan if I can. I’m concerned that they understand the future ramifications of policy loans. Most agents don’t take the time to explain them, so you run into situations where small loans taken out years ago have accumulated so much interest that they’ve grown into a monster. The only time I recommend them is if a premium loan is the only way to salvage the policy.

Absolutely! That's exactly my point and unlike you, there are some agents out there that are extremely green to the industry or just flat out do NOT care about the client and I see these situations occur more often then not.

 

[TripleH]

When I first became a staff manager, the district manager realized that I was pretty good at spotting agents who were in the book. He started having me ride with other managers’ agents who he suspected. I found several in the book for between a few hundred dollars up to a few thousand dollars. None of them ever started out to embezzle money. They only meant to borrow it for a week or two, but kept getting deeper and deeper.

My manager told me it’s almost always one of three things: women, drugs, or gambling. But I also found agents “dipping” who just ran short and needed money for a big bill, or gas money, etc. Or they’d keep Mrs. Jones from lapsing by borrowing from Mrs. Smith’s advance. Then when Mrs. Jones lapsed anyway, well....Mrs. Smith wasn’t paid ahead anymore!

After about 15 years in the business I went to work for a buddy who was a former agent of mine who was staff manager at another company. Soon after I got there, I happened to notice one of the veteran agents on the staff hovering over his collection report in a way that made me suspicious. I didn’t know him at all, but I told my buddy that he should check the guy’s book. Of course, he knew my reputation for being able to spot those problems, so he rode with him the next week. The guy was sure enough into the book for a few grand. The heartbreaking thing about it was that he’d been working on that same agency for 29 years, and was apparently a good agent up to the point he started “dipping”, only to be terminated for theft.

WOW!! That is powerful right there- I also explain the clients that benefits of having EFT and now I know for certain no one can dip into their policy. Great info, thank you!

 

[rousemark]

WOW!! That is powerful right there- I also explain the clients that benefits of having EFT and now I know for certain no one can dip into their policy. Great info, thank you!

EFT won't prevent a dishonest agent from "dipping" into people's policies...

 

[TripleH]

ran one for 7 plus years my self. Not out one dime!
However, I did do one audit. Gosh darn. The guy was into the money for over 7G's
Far as i know he paid it back. Had one other audit i was a part of. Same result.

Wow!! Crazy stories - that’s why it’s always best to check. Of course it comes down to the agent. There’s still more good than bad agents in this world. I can’t imagine an agent being into the money for 7k!