Most business models are built around the premise of keeping your current client base and building on it. Given the premise it’s understandable that a business would be upset about losing a customer.

In life insurance that client relationship is certainly true when it comes to your agent. Agencies are built on earning trust, serving clients and from that comes a natural tendency for clients to recommend us, so we grow.

With insurance companies all of the same holds true, except for this one kind of gray little area where a company has been making money from you for some time, and have stood ready to provide their end of the contract, a death benefit, but you choose to replace their policy with another or cancel it because you no longer need it. While they will do what they can to keep your business, let’s be real.

If the company has taken in, say, $5000 in premiums over the years on a $500,000 policy and you decide to cancel that policy, the company has really kind of hit the sweet spot with your business. Enough money that they have made a profit and they can bank it because there won’t be any death benefit to pay. And before you declare them slum lords of some sort because they would take their money and run, remember that quite often very little is paid in and a lot is paid out.

A few recent deaths in my client base really point this out. One client had paid in just over $800, one annual premium, and his family received $100,000. Another had paid in almost $3000 over about a year and a half and the family received $1,000,000. Is it OK with the company if you find a better deal and go elsewhere? Sure it is. Do they still value you if you continue to be their customer? Sure they do.

Bottom line. The best of all worlds comes with an independent agent. A good agent will find you the best possible deal at the time you meet, but also present you with any opportunities to improve on the value of your coverage as time goes by. Their allegiance is with you, not any particular insurance company.