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It is a common belief that a life insurance agent’s offer of an annual review of your policy is nothing more than a ploy to try to get you to buy more insurance. I know from experience with my own clients that many are so sales phobic that their honest belief is that any contact from us, including birthday greetings, is a sales pitch attempt in the making.

In spite of the fact that my clients were never “sold” to start with and in spite of the fact that I tell them I will stay in touch during the life of their policy, at least on an annual basis, I can tell from their reaction that they think I am up to something when I call and ask if any questions have come up or if there is any way I can be of assistance (change of beneficiary, payment plan, etc).

I’m not naive enough to believe that all agents are calling simply out of a desire to be of service, and I won’t tell you that, if asked, I won’t provide up to date quotes and provide a better policy given their current situation or additional insurance if they feel that is a prudent thing to look at. But the annual review or annual service call has importance even if nothing happens.

There are plenty of agents and agencies out there who will gladly sell you life insurance and never talk to you again, so if that is what you want, it’s available. But, just for a minute, let me suggest that there is truly a value added to your product when an agent is willing to stay in touch.

I generally send out a letter to my clients about six weeks before the anniversary of their policy. Attached is a sample. annual-review-sample-letter
This contains information that may prompt questions. Suppose, unlike the sample, the letter explained that you were in the 9th year of a 10 year term. It’s time to give some thought to what happens at the end of the 10th year and possibly will lead to questions about what options are available.

This letter is followed up about 10 days later with a call from me simply asking if they received the letter (if they didn’t, it could be that their address has changed and they forgot to inform me or more importantly the company), if any questions came up after reading the letter (like what is the conversion option?) or if there is any way I can be of assistance. Usually in the 5th year or so of the policy I ask if they are still comfortable with the amount of insurance and the term length.

It is not a rare occasion, even with annual review calls, that a client will kind of forget what they have and the reminder helps remind them of why they bought what they bought. I have a substantial block of private pilot clients and it’s amazing how many will forget that the reason they purchased the policy they did and the reason they purchased it through us, is that it covered their aviation practicies at a fair rate.

I also review each client’s situation annually before calling to see if there are ways to save them money. If, for instance, they were approved initially at a higher rate than expected due to elevated cholesterol on their exam, I bring that up. If they’ve worked on getting their cholesterol down to normal limits, it’s possible in many cases to get a new policy at a lower rate. If someone has indicated that they are trying to quit smoking, I make a note of that because if they do there is substantial money to be saved. For some, an improvement in health or a change in habit may mean that they can now afford a longer term without raising their premium.

Bottom line. Service has earned a bad reputation, probably from unscrupulous agents that want to sell you something new every year whether it is warranted or not. That is called “churning” and is illegal. Don’t be afraid to participate in an annual review. If it feels like a sales call you might want to chastise your agent for that. If it feels like service and value added, that’s exactly what it is.