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We’re focusing this month on the importance of life insurance policy reviews. Conducting regular performance evaluations for your clients is an easy way to connect and get a good overall picture of their financial situation. It gives you an opportunity to maintain a list of their existing policies, find out if they have been performing as expected, and determine if they still meet their current needs. Best of all, it can often uncover big opportunities for you in terms of making the sale.
Why Conduct Performance Reviews?
A lot can change after purchasing a life insurance policy. What may have been an excellent product and very well suited for your client at the time, numerous changes have occurred in terms of product choice and pricing.
Your client’s health can also be a factor when considering their existing policies. Medical advancements and healthier lifestyles contribute to longer life expectancies, and certain insurance companies now provide more favorable treatment
toward medical conditions such as diabetes or cancer.
SUCCESS STORY #1
An advisor reached out to DBS about his clients, a husband and wife. The husband had an existing policy with $80,000 of cash value and wanted to upgrade that to a new policy with a chronic illness benefit. The wife did not have an existing policy at the time but wanted to purchase a new policy, also with an extended care option.
Our Senior Case Design Analyst shared the results of the performance evaluation with the advisor and showed several options for upgrading to a life insurance policy with a long-term care or chronic care rider. Three of our top carriers ranked highly, but the client decided to purchase a Prudential VUL Protector policy with a Benefit Access Rider. Using a 1035 exchange from his existing inforce policy he would be eligible for a $500,000 death benefit that is guaranteed for lifetime,
along with benefits for extended care expenses with the Benefit Access Rider. At the time of writing this, the application is in process!
SUCCESS STORY #2
We recently conducted a policy review for a 65-year-old male client, who had an existing life insurance policy that was not being administered very well. When the advisor asked for an illustration showing potential income, they only illustrated $3,000 at retirement, though there is currently about $360,000 of cash value in the policy.
Our Senior Case Design Analyst illustrated our best IUL options, with the client ultimately selecting American General’s Max Accumulator Plus IUL. With this policy, the client receives a death benefit, but will also be able to access additional benefits while living. Using a 1035 exchange of the existing policy value of $359,847 and an additional planned premium of $800/month, the client received the option of an income stream while still living, along with the existing death
benefit. This case turned from illustration to application in just 13 calendar days!
Even if their policies have performed up to par, the variety of products available today may improve cash accumulation, increase coverage, or reduce premium outlay. The end result of a performance review may validate their original policy, or it
may result in a complete change. Either way, you achieve the goal of offering value to your clients by evaluating an important financial instrument in their overall financial plan. Contact your dedicated Case Design Analyst today to ask about the performance evaluation materials available at DBS!