$50 MILLION LIFE INSURANCE SALES STARTS WITH P/C AGENTS
Life agents can learn much from the following Life case written by a mother-daughter team.
It all started, the agents said, when another agent failed to return to a client as promised, to convert a Term policy. Upset, the client called his P/C agent who in turn called the Life agents he worked with. Together they met with the client and converted his Term insurance. They also identified the need for Second-To-Die insurance, and the client agreed to buy it. The agents then asked about the client's father, a man of considerable wealth who, they learned, carried only $750,000 on his life. His son felt that at least $50 million was needed, and the agents presented a plan of combined permanent and term amounting to $50 million to be written by six companies. The father and son told the agents to call two weeks later for their decision.
When they called, the prospects agreed to buy the proposed insurance. But the story doesn't end there. The father's medical examination revealed a prostate problem, so all the carriers declined the case.
What would you do?
The agents called one of the underwriters for advice on getting these policies issued. The underwriter suggested getting the prostate-specific antigen levels down by having the father drink plenty of water. The creative agents, Judith Panos, CLU, and Debra Franklin, CFP, of Livingston, NJ, called the son, other family members, and the applicant's secretaries, instructing them all to bring him water continuously. Another examination a week later found his antigen levels within a normal range. All six carriers agreed to proceed with underwriting.
Still, there were bumps in the road that had to be smoothed. Prior to submitting the apps, the agents had arranged with the six underwriters to coordinate their efforts. Although working independently, they freely shared information. Once one of the major companies approved the case, the others would follow.
'We thought we had the ball over the goal line,' the agents stated, 'until the case got to the issue department. They wanted additional financial information.'
The client resisted, unwilling to release this kind of information, especially to six different companies.
Gridlock. The problem was solved by getting the companies to agree that if the lead company was satisfied with the financial information, the others would also issue. The client agreed to fax the additional financial information to the lead carrier. Five minutes after the fax was received, that carrier called the agents to say that it was satisfied. All the carriers now approved the case.
The agents delivered $30 million of permanent and $20 million of term insurance. They also illustrated how the client could convert the term in four years. When the client bought the original $50 million of coverage, the agents report, he had figured on converting and in his mind would be spending $22,747,295. But the question of converting the term arose. Fortunately, the major carrier offered a credit for the prior year's term premium towards the purchase of a permanent policy, meaning that they didn't have to wait until the fourth year to act. They considered the benefits of converting now.
The term premium in 1991 was $159,538, to be paid semi-annually. The major carrier agreed not only to give credit of $159,000, but offered an additional credit of the semi-annual premium that had just been sent in. 'By converting the $10 million of insurance, [the client] would pay $132,252,' the agents explained. But the real impact, they added, was on the overall premium. Instead of spending $22,747,195, his overall premium went down to $21,646,743, a savings of over $1.1 million with $40 million of permanent Life insurance. 'How could he resist?' they asked.
The next step, the agents noted, was to convert the final $10 million of term. That was recently done, completing the total package of $50 million of permanent coverage.
In addition, the agents reported, during the last three years of working with this client, they were also able to close cases on relatives, key employees, and their families. One of the secretaries came from a very wealthy family, and covering her insurance needs generated premiums in the five-figure range.
'Our next step,' the agents conclude, 'is to find another client like this one.'
The question is: How many similar cases are in your client list waiting to be seen? Remember, this case started with a phone call to a P/C agency, triggered by an outside Life agent who had slipped up.
You shouldn't wait for such calls. Actively seek to find similar situations by constantly putting out feelers for them. If this client had been your P/C insured, what would have happened?