by lifeagent911 » Tue Mar 10, 2009 06:52 pm
I just wanted to give you some food for thought.
Let’s talk about an avg sale. The client wants to protect their love ones if/when something happens to them. Most clients only think about covering the cost of a funeral and paying off the house. Some of them even think about the kids going to college, but that is all.
But a lot of clients are not protecting their family members enough. They are not thinking about income.
Example. If a husband is making $120,000 a year. We need to also account of the loss of his income. Sure the house will be paid off and the cost of the funeral taken care of, but is that really enough? The answer is NO!!
The wife will now be without the husband’s income forever. She has grown accustom to her lifestyle and now the income is gone. Even if she is working also, the income that he was bring in is now gone.
The question is how many years income does she need until she either replaces his income or don’t need as much. The house is paid off now, but that only takes away the house payment. Nothing else. The rest of the bills still come in each month.
Again the problem is that a lot of agents and clients are only thinking paying off the house and paying for the funeral. This is a huge mistake.
You need to talk to your client about insuring the current income for a while also. When I got a policy on myself, I also included 5 years of my income at the time into the policy. I wanted to make sure she would at least have the same thing coming in for 5 years after I am gone and have the home paid off, the funeral taken care of and I also included some college money for the kids and a little more then what I thought she needed.
I’ve went back a couple of times since to make sure that I’m leaving her enough. Later down the road when the kids are gone and the house is paid off, and I’m still alive, I will go back and lower the face amount maybe.
I just want you to make sure the client is buying enough life insurance.
Let’s talk about an avg sale. The client wants to protect their love ones if/when something happens to them. Most clients only think about covering the cost of a funeral and paying off the house. Some of them even think about the kids going to college, but that is all.
But a lot of clients are not protecting their family members enough. They are not thinking about income.
Example. If a husband is making $120,000 a year. We need to also account of the loss of his income. Sure the house will be paid off and the cost of the funeral taken care of, but is that really enough? The answer is NO!!
The wife will now be without the husband’s income forever. She has grown accustom to her lifestyle and now the income is gone. Even if she is working also, the income that he was bring in is now gone.
The question is how many years income does she need until she either replaces his income or don’t need as much. The house is paid off now, but that only takes away the house payment. Nothing else. The rest of the bills still come in each month.
Again the problem is that a lot of agents and clients are only thinking paying off the house and paying for the funeral. This is a huge mistake.
You need to talk to your client about insuring the current income for a while also. When I got a policy on myself, I also included 5 years of my income at the time into the policy. I wanted to make sure she would at least have the same thing coming in for 5 years after I am gone and have the home paid off, the funeral taken care of and I also included some college money for the kids and a little more then what I thought she needed.
I’ve went back a couple of times since to make sure that I’m leaving her enough. Later down the road when the kids are gone and the house is paid off, and I’m still alive, I will go back and lower the face amount maybe.
I just want you to make sure the client is buying enough life insurance.
Posted: Thu Mar 12, 2009 10:11 pm Post Subject:
I have a client who called me upset with their insurance agent because he sold them (years ago) a 30 year term policy. After she and her husband met with him, he assured them that he believed the face amount would be high enough...after all...it was enough to pay off their house and all of their bills should her husband ever pass away. However, he failed to consider the fact that her husband was a professional, and she had no work experience of any kind. When they met with their financial advisor, he couldn't believe how small the policy was. The policy was for a mere 100,000. While this was a large enough amount to cover their mortgage and bills, this would have left the woman with very little to live on and there was virtually no retirement savings to speak of.
Luckily, the husband and wife are both still alive and still young enough to be able to purchase some additional insurance without costing them their last penny...
But it's a valuable lesson for all of us. If we are selling a policy, it needs to be the right one and it needs to cover the things that it is meant to!
Posted: Fri Mar 13, 2009 04:29 am Post Subject:
A well comprehended definition of life insurance would always include the phrase ‘it replaces the income of the policy holder at the event of his pre-matured death’, but we often fail to encompass the idea while shopping for coverage.
Agents might try to push a small amount policy since its easier to convince the client to spend less. For higher face value policy the premium would also be high, which the insured mightn’t always be ready to commit.
~Jeremy
Posted: Fri Mar 13, 2009 02:04 pm Post Subject:
Hey there..
It feels nice to know that visionaries like you still exist..
I just want you to make sure the client is buying enough life insurance
But, while determining the worth of life insurance, you should also keep in mind that there could be a whole lot of other risks that your client is worried about. It's even worse when he'd not share it openly with you!
Your challenge lies in empathizing with him and showing him the right way without putting too much of stress!
Caromel_merquez
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