I wrote a post some time ago less than nicely titled “Burial Insurance is Stupid”. I make myself laugh I’m so opinionated sometimes, but this article was not one of those laughable moments. I take very seriously those things that treat those seeking senior life insurance downright wrong.
That was written over two years ago and my opinion of burial and final expense life insurance hasn’t changed. I did just recently get a comment on that post which I want to share along with some of my takes on this agent’s comments.
“I sell burial insurance. People want this product. Often these are people who have an immediate need for coverage. They have not saved for their future. They probably will not save for their future.
It’s not my job to convince these people to study the stock market and to allocate 12% of their monthly income for the future. I am merely there to provide a service that they need. The buyers of burial insurance frequently have major health problems. They have already (in many cases) been turned down for insurance. They want to leave their family a bit of money to bury them with. I commend them for their consideration for their family.
This week I will be writing a 58 year old man a $50000 simplified issue policy. He will pay $52 a month for this policy. He weighs 305 pounds and is 6 feet tall, has diabetes, and a few other things. He is willing to pay this monthly amount as he wants to leave his wife something if he passes away.
I personally will not buy a new car. Does that mean nobody should buy a new car? I don’t think so. I feel they are not a good buy. But maybe they are a good buy for someone else, considering their lifestyle and situation.
Everyone is different. The guy I will see this week has tried 29 times through full underwriting to get a policy. My hope is I will get this for him.
He will be happy and I will get a nice commission.”
I have used bold print on a few things that I would like to clarify.
1. People want this product? If they truly want the product it is only because the agent they are talking to won’t tell them about traditional life insurance products that will give them far more insurance for their premium. He wants that “nice commission”.
2. Immediate need? If people are feeling an urgent need to have coverage where they haven’t had any they can simply do a temporary insurance agreement while the policy is underwritten, or they can do as this agent suggests and pay through the nose in order to get a policy in their hands within a few days. Both ways give immediate coverage.
3.”This week I will be writing a 58 year old man a $50000 simplified issue policy. He will pay $52 a month for this policy. He weighs 305 pounds and is 6 feet tall, has diabetes, and a few other things. He has applied 29 times through full underwriting.”
It is at this point that I challenged the agent to show me an application and approved policy at $52 for $50,000 telling him that I would post a retraction of my disdain for this kind of nonsense. No one turned down 29 times through full underwriting is going to be approved for simplified issue insurance. The MIB file on this guy is so big that, even though he only has to answer a few questions, even the simplified issue company will see that something is very wrong. VERY WRONG! That leads to a decline
The client might be able to get a guaranteed issue policy through this agent, but given his health he is very likely not working and won’t be able to afford even a modest amount of guaranteed issue life insurance.
Bottom line. A lack of planning ahead of time doesn’t mean you are stuck with final expense policies that are overpriced or under guaranteed. Before you commit to the no exam life insurance, simplified issue route, check out traditional life insurance. You won’t be disappointed.