Questions about simplified issue policies

[Todd King]

@Newby I believe the strategy behind selling GI first, which is one strategy I thought of, is to do ANYTHING you can to try and get them INSURED as soon as possible, even with the graded terms and extra price. Because from a radically pure life insurance standpoint, you are trying to help them have access to a sum of money that is significantly higher than they already have for a rental fee. So the idea would be to have them pay for like 2 months of guaranteed issue while they wait for a fully underwritten policy, and if the worst case scenario happens where they are actually in very poor health, they will have already started the graded portion of their GI policy.

Personally, I might not choose to start them on GI unless I already knew they had serious health problems. I would probably start them on an appropriate simplified policy while trying to get them on a cheaper fully underwritten policy, because the simplified policies i believe are closer to 2-3x a fully underwritten policy and provide day 1 coverage. Of course, i dont fully know if those price ratios are correct. Can anybody vouch if those ratios are correct and if that sounds like a solid strategy?

I won't comment on this from the standpoint of it being right for the client or not, but if you keep writing policies that lapse a couple of months later, eventually the company is going to term you due to all of the early lapses. It's not really a good idea.

 

[New Ins Dude]

So then a binding receipt might be a better strategy?

 

[WinoBlues]

Hey everyone, I was approached a few months ago about becoming a life insurance agent. The money sounded good so I've been looking into it, got my license, and have been contracted to sell through several carriers.

Since I jumped in quickly, I wasn't fully aware of what I was doing, but now that I have a decent grasp of what's going on,.........

@Newby I believe the strategy behind selling GI first, which is one strategy I thought of, is to do ANYTHING you can to try and get them INSURED as soon as possible, even with the graded terms and extra price. Because from a radically pure life insurance standpoint, you are trying to help them have access to a sum of money that is significantly higher than they already have for a rental fee. So the idea would be to have them pay for like 2 months of guaranteed issue while they wait for a fully underwritten policy, and if the worst case scenario happens where they are actually in very poor health, they will have already started the graded portion of their GI policy.

Personally, I might not choose to start them on GI unless I already knew they had serious health problems. I would probably start them on an appropriate simplified policy while trying to get them on a cheaper fully underwritten policy, because the simplified policies i believe are closer to 2-3x a fully underwritten policy and provide day 1 coverage. Of course, i dont fully know if those price ratios are correct. Can anybody vouch if those ratios are correct and if that sounds like a solid strategy?

OK, I read the above post and my initial thought was "uh, What?" Then I read your first post in the thread.

You are a new agent. I get that you are trying to do the best for your prospect. However, you are way overthinking something you know nothing about.

GI, if they are going to be able to qualify for a level benefit or even a SIWL or graded plan putting them in a GI is a waste of time and money. For the 45 +- days it will take to go thru fully underwritten they would have been better off putting the GI monthly premium in their sock drawer. Also I assume you would have collected the first premium to activate the TIA on the FU plan. So they would have twice the money out. Now, Let's say they qualify for the FU Policy. You now lapse the GI policy and get a chargeback. After a few of those in your first year, you will be terminated.

....... Firstly, the company I work for is focusing on selling simplified issue whole life insurance policies. The original strategy I was told was to focus on seniors with health problems......

= FE agency. FU and SI are two very different markets, usually. You can slide from one to the other pretty easily if you have set realistic expectations with the prospect. With your agency's focus you are going to be prospecting lower income, less savvy, more ill, broke people that are looking for very small policies. Those = FE products. Not traditional Life clients be they FU, Non Med or SI.

The FE guys will tell you to start out by focusing on one type of product and just a couple of companies with one or two gotos. I would agree.


EDIT: OK, I was posting and a call came in so I finished the post after the call. So, What Todd said.

 

[jdeasy]

@Newby I believe the strategy behind selling GI first, which is one strategy I thought of, is to do ANYTHING you can to try and get them INSURED as soon as possible, even with the graded terms and extra price. Because from a radically pure life insurance standpoint, you are trying to help them have access to a sum of money that is significantly higher than they already have for a rental fee. So the idea would be to have them pay for like 2 months of guaranteed issue while they wait for a fully underwritten policy, and if the worst case scenario happens where they are actually in very poor health, they will have already started the graded portion of their GI policy.

Personally, I might not choose to start them on GI unless I already knew they had serious health problems. I would probably start them on an appropriate simplified policy while trying to get them on a cheaper fully underwritten policy, because the simplified policies i believe are closer to 2-3x a fully underwritten policy and provide day 1 coverage. Of course, i dont fully know if those price ratios are correct. Can anybody vouch if those ratios are correct and if that sounds like a solid strategy?

They aren't covered anyway on a GI policy. Surely your underwriting is not going to take 2 years?

It seems you are getting really bad advice, and training, from your upline.

IMO's push SI because they get paid faster. But you should never go into a meeting with a person with a preconceived idea of what you are going to sell. them. Regardless of what some desk jockey tells you.

I cut my teeth in the MP market and with an IMO that pushed SI and wanted us to scare people out of exams. That wasn't right with me from the getgo. Even though I knew absolutely nothing about insurance. I did know that people weren't scared of an exam if it saved them money.

So I didn't follow the lead of writing only SI. Fortunately I wrote enough business to keep them at bay. But they always mentioned it. And in a derogatory way.

I've been FE focused for the last 9+ years. I still write what's best for the client. They tell me I write more FU than any other FE agent. I don't know if that's true but that's the remarks I get.

Everyone has a WHY. Find that why and then proceed. Term might solve their WHY. Whole life might? After that is determined then the next step is whether FU or SI is the route.

In the vast majority of the cases now for me it's going to be SIWL. That's because I only get FE leads. It's a given that I'm seeing a targeted market.

What market is your IMO targeting?

 

[New Ins Dude]

"You are a new agent. I get that you are trying to do the best for your prospect. However, you are way overthinking something you know nothing about."

Yes, this part needs to be re-emphasized, I'm trying to actually understand it. Not just because I don't understand it, but because I've already seen some things where some practices may not have been in the client's best interest. But I don't know if they were or not because I know almost nothing about this. Not only have I seen some questionable things already, but I've heard some horror stories in other areas of this business, and I'm not trying to be a part of any horror stories. I wouldn't necessarily call that overthinking, I'm just doing my homework. There's a spectrum between going in blind and overthinking.

"With your agency's focus you are going to be prospecting lower income, less savvy, more ill, broke people that are looking for very small policies. Those = FE products. Not traditional Life clients be they FU, Non Med or SI. "

Yes, this is the focus I'm being told, however I have reason to believe policies are being sold outside of this focus. Hence all the questions.

 

[New Ins Dude]

"It seems you are getting really bad advice, and training, from your upline."

I would describe it as very minimal training and advice regarding actual life insurance and final expense, with more focus on just how to get in a house and close a sale.

 

[jdeasy]

"It seems you are getting really bad advice, and training, from your upline."

I would describe it as very minimal training and advice regarding actual life insurance and final expense, with more focus on just how to get in a house and close a sale.

What do you want to do? That's the most important question right now.

 

[WinoBlues]

"You are a new agent. I get that you are trying to do the best for your prospect. However, you are way overthinking something you know nothing about."

Yes, this part needs to be re-emphasized, I'm trying to actually understand it. Not just because I don't understand it, but because I've already seen some things where some practices may not have been in the client's best interest. But I don't know if they were or not because I know almost nothing about this. Not only have I seen some questionable things already, but I've heard some horror stories in other areas of this business, and I'm not trying to be a part of any horror stories. I wouldn't necessarily call that overthinking, I'm just doing my homework. There's a spectrum between going in blind and overthinking.

"With your agency's focus you are going to be prospecting lower income, less savvy, more ill, broke people that are looking for very small policies. Those = FE products. Not traditional Life clients be they FU, Non Med or SI. "

Yes, this is the focus I'm being told, however I have reason to believe policies are being sold outside of this focus. Hence all the questions.

IMohsoHO, a Life Insurance agent can slide back and forth between several type products as the want, need and reality dictates. However, that takes time to gain the experience, knowledge and feel for it. Focus on Life Insurance or Final Expense. Sell the other if the need arises. However, My guess is you would come across more SI/FE cross sales doing traditional than Traditional cross sales focusing on FE. More middle-class prospects have health issues or older parents than Poor people have middle-class referrals.

Learn and run your market. If you come across something outside of that team up with a more experienced agent and shadow them on that appointment. The split commission is tuition. As a new agent jumping in and out of focus you will have the skinniest kids on the block.

As JD Asked. What do you want to do?

 

[New Ins Dude]

Honestly, I just want to keep living my life while exploring different opportunities and experiences. The way this opportunity was sold to me was very intriguing. I could potentially earn a lot more money while doing something good for the community.

I still believe that is potentially true, but I don't need to rush into it. So currently I'm more interested in learning about the business and making sure I'm doing it in a way that fits my personality and lifestyle. I'd rather over think it and make sure I'm not selling inflated policies, and possibly explore other avenues that might fit my lifestyle (selling part time instead of full time, having at least some term and universal products in my bag for the right clients).

And if at the end of the day I really just don't like it and don't want to do it, I can just not do it.... but I haven't really learned the situation yet