I walk into many of our advisors offices and their screens are blinking the reds and greens of the market. They can tell me what every trendline represents on every advanced chart, who they are buying, and who they are selling for their clients.
When I ask them which insurance products they are bullish on and which they wouldn’t touch with a ten-foot pole I get a blank stare.
I understand that insurance is not sexy but for those of us that pay attention there is blaringly red and green performers, red and green products, and red and green carriers in the industry.
Due to this I always advocate offering your clients insurance policy reviews. For the most basic review, the only requirement is that you must send Algren an annual statement. It is as easy as adding one more statement to your fact-finding meeting with clients. If you want to get more in depth we can advise the next steps required.
Some policy reviews we have assisted on in the past few months have yielded some of the following results:
- An advisor had a client with three under-performing Whole Life Insurance contracts. We facilitated 1035ing them into a brand new IUL contract that cost him about half the premium of the original contracts with substantially greater opportunity to grow his cash value. The advisor earned five-figures in commissions.
- An advisor had a client with an old policy that was owned by a no longer needed trust. The client could no longer afford the policy do to an illness that had a major impact on his ability to earn income. He was going to surrender the policy when we discussed with the agent the opportunity to do a Life Settlement. The client walked away with over twice as much in cash than had he surrendered the policy for its cash value. This advisor also earned five-figures in commissions.
- While reviewing another advisor’s client’s decades-old policy we noticed that the selling agent had set up the policy with the client’s parents as owners and their special needs child as beneficiary. The owners had passed over a dozen years ago and we pointed out the taxable implications that had existed. This lead to a brand-new policy being purchased inside a special needs trust. When the advisor went to get the forms signed by the trustee he found that the trustee was in the market for a financial advisor. This advisor walked away with good commissions and over $1,000,000 in new AUM that the trustee transferred to him.
These are just three recent policy reviews that have been successful. There are dozens more.
Warren Buffet advocates “If you don’t feel comfortable owning a stock for 10 years, you shouldn’t own it for 10 minutes.” We agree; however, many clients and advisors do not undertake the same due diligence with Insurance products that they do with investments.
Through policy reviews, we can help you see the reds and greens in your clients’ insurance portfolios. Let us assist you in showing them where we are bullish.