Ed Hinerman On Life Insurance

Don’t Be Bashful About Replacing Your Life Insurance Policy!

So, you have this life insurance policy and you don’t know if it’s a good deal or not, but it’s in force. That’s a good thing and actually far better than most folks have done. But what if there is a better deal out there?

I am amazed at the loyalty that people have to life insurance policies. The thing that amazes me is that there is generally not an agent that is actively staying in touch and servicing your business and in so many cases the loyalty isn’t to the company for their stellar financial ratings. Clients have often expressed to me that they kind of don’t feel right about switching because, I guess, they feel like that makes them a bad customer.

Let me try to put some perspective on this. The agent who sold you the policy was paid a commission. While most agents don’t agree, in this office that means you get our service for the life of that policy. Some customers feel a certain loyalty to me because I do stay in touch and help them with their questions. Some don’t.

But the norm is that you will buy a policy, be thanked for your business and you will never hear from the agent again. They made their money and they are done with that sale. Nothing personal. They just really don’t see the value in being their for their customers.

You should have no second thoughts at all about replacing a policy through me, good service and all, if you find a better deal, and you should certainly have no loyalty to someone who doesn’t remember your name after the commission check is cashed.

As for the company, let’s really get a grip. It’s going to happen one of two ways. Let’s say you have a policy for $500,000 for which you are paying the company $1000 a year. Let’s say 8 years into the policy you find a better deal. The company has been paid $8000, more than enough to pay for underwriting and any cost associated with putting the policy in force, and then some. So they make, say, $6000 and you cancel your policy and go elsewhere.

Now true, they would have loved to continue to get $1000 a year, but what they won’t miss is the chance to pay your family a $500,000 death benefit. Don’t take that wrong. Insurance companies stand ready to pay and pay without a fuss, but from a profit and loss standpoint, keeping the half million on their side of the ledger is a good thing. The longer you are a customer the higher the risk that they will pay out the big one.

So, are you hurting their feelings or messing them up when you replace their policy? The answer would be nope.

Bottom line. Whether your cholesterol has gotten better or you’ve lost weight and your diabetes is better controlled, or if you just got your last policy through one of those over priced no exam companies, shop it and don’t be bashful about replacing it if you find a better deal.

One other thing to keep in mind. A better deal isn’t always just price. How long the price is guaranteed is a huge factor also.

Add comment October 29th, 2009

Prostate Cancer Not Insurmountable With Life Insurance!

I got a call from a prospective client last week wanting to see if I could find anyone who would offer him life insurance.

His issue is prostate cancer with a Gleason 9. He had a radical prostatectomy, chemotherapy and is currently on hormone therapy Lupron. His PSA has been undetectable for a year and a half. While we certainly haven’t had much luck with a Gleason grade greater than 7, I told him I would shop it and see. One thing about this business is you really never know.

I got the first round of responses in yesterday and for the most part they were the typical “No way” answers that the reinsurance manuals would lead them to. No harm. No foul. There are companies that will not deviate from reinsurance guidelines even when the death benefit is within their retention limit. I think it’s kind of woosy, but I’m not their CEO so what can I do.

I did get two interesting responses though. Western Reserve Life said no for now but that they would consider coverage December 2010. I suspect at that time it would come, if they approved it, with a substantial flat extra, but that’s OK. We’ll keep that one bookmarked. The other was Lincoln Financial who said they would consider coverage once he was not on Lupron. That may or may not work because we don’t know if Lupron will go on for the rest of his life or not, but again it was not an absolute no.

Generally prostate cancer with a Gleason grade 6 or less is not a big issue as long as the treatment has brought the PSA down to essentially 0 with a radical prostatectomy and less than 0.5 if the treatment was seed implant. Approval at standard or standard plus is a target that can generally be hit. Even a Gleason 7, depending on the stage of the cancer is generally not insurmountable in the life insurance search. A Gleason 7 would probably be a rated policy, higher than standard rates.

But Gleason 8 and above is indicative of a fairly aggressive cancer. I have reached out to more companies on behalf of this client and will post all of the results by each company once they all respond.

Bottom line. Prostate cancer is the second most common cancer amongst men but with early detection and treatment, it is a very survivable cancer.

Add comment October 29th, 2009