oops I mean interest rates go DOWN.

Anyway.....I'm outta here.... Happy New Year everyone.

[quote=anonymous]

Fixed or variable?  What was the specific product?

The issue is on insurance products is that the B/D is (unfairly) taking a cut of a non-registered product.  

If it was a variable product, you probably got treated fairly.  If it was a fixed product, you probably got hosed.

The commission is product specific, so your question can't be answered.  On a typical fixed annuity, a sale of that size should put 30-40K in your pocket. 

[/quote]

It was a variable product. My partner did the sale so I don't have anything in front of me at this moment to give specifics. I 'll say this, we didn't get anywhere near 90% payout.

A 90% payout would only be possible on life insurance, not an annuity.  A variable annuity would pay roughly 3-6% to your B/D.  It would then have to go through your grid.

And they're going to go after "c" shares in IRA accounts?

I kinda always did (and still do) think the client is the chumpee on those deals! I'm not telling anyone how to sell what or which ethical dilemas exist for whom or anything along the lines of!

I think it is myour (mine, yours, ours) client's best interests that their consultant is still in the bidness next year.

BTW, most of my book is NY State based, so much of the eyepopping stuff is not available in NYS.

Mr. A

Mr. A, can you please explain your post.  I don't understand it.  Are you saying that the client is getting screwed because of high commissions?  If that is the case, I would actually argue that the high commissions are there because the insurance companies have found this to be the LEAST EXPENSIVE distribution method, thus giving the best value to the client.  Have you noticed how no load insurance products are not any cheaper, and in fact, perform worse.

Babbling Looney,

I'm going to take some time to beat up on your post.  Please don't take it as a personal attack.  It's meant so that you can learn.   You seem to really care about your clients.

I don't do much life insurance except in conjunction with estate planning or business successions. 

All of your clients are going to die.  If you are going to be their financial advisor don't let another advisor get a piece of your client.  They will if you don't take care of the insurance issues for everyone.  This includes disability insurance and long term care insurance.

You have to constantly be on the phone to the Doctor's office to get the medical information in time.

Let the insurance company handle this for you.  This should not be an issue.  If the doctor's office is being slow, have the client call.  Releasing medical information is a profit center for the doctors.

The paramedics are usually backed way up in our area, thusly giving the client plenty of time for second thoughts. 

This shouldn't be happening.  The paramedical companies are in competition with each other.  Make them give you great service.  Preset the exams.  "Mr. Client, is Tuesday at 3:00 a good time for you to be examined or would another time work better?"  Then, with the client still in your office, call the examination company and say, "I have Joe Jones in my office.  We need an examiner to see him Tuesday at 3:00."   If the company that you are using is not giving you great service, pull your business from them.  Honey also works.  ie. Treat the parameds like gold.  They can be of great help.

Half the time the clients lie to you about their medical conditions and the underwriting comes in much worse than anticipated and the premiums are much higher than you quoted.   

You must take the blame for this.  This won't happen if you drill it into your client's head that all of their health history will be seen by the insurance company.  Tell them that you must know EVERYTHING about their history.  You are the expert and you will use your expertise to make sure that you use the best insurance company for that person based upon their health history.   Doctors and insurance companies look at things very differently. 

It also sounds as if you don't have the necessary expertise to match the right client with the right insurance company.  Your quotes should almost always be worse than what the client receives instead of the other way around.  Under promise and over deliver.  When you become an expert in life insurance, you'll learn to sell coverage without giving a quote.

You need to monitor the policy to make sure it doesn't collapse if interest rates rise or if the variable accounts are tanking. You may need to ask the client to pay more premiums if they didn't overfund the policy in the beginning or decided to go on the cheap and just pay the bare minimum. 

Again, this is completely your fault.  Don't sell UL and VUL contracts.  The client almost always gets screwed on these policies.  I can't imagine a worse place to take risk (investment risk or interest rate risk) than in someone's life insurance policy.  Don't believe me?  Find one person who has had a policy for more than 20 years and the policy is not in danger of lapsing.  Sell life insurance for the guarantees.  Use old fashioned whole life and term insurance.  The only ones who do well with UL/VUL are the insurance companies. 

UL and VUL are especially inappropriate for the business and estate planning market.  The exception is GUL for older ages, but I'm assuming that you are not referring to this since you mentioned interest rates.

You owe it to yourself and your clients to become an expert in these areas.  In the meantime, find a mentor.  Split the commissions with that person while you learn. 

There's a saying that I like.  "Learn for your clients instead of on your clients."  Don't let your clients be guinea pigs as you learn the business.

It just goes on and on and on.

I think we earn the money in life insurance

Well said Mr. A.  I just read this post and have to agree that you are absolutely dead on in your analysis of life insurance.

[quote=DodgerDraftpick]Well said Mr. A.  I just read this post and have to agree that you are absolutely dead on in your analysis of life insurance.[/quote]


Right…because you’re such a seasoned veteran and expert and all…

[quote=anonymous]

Babbling Looney,

I'm going to take some time to beat up on your post.  Please don't take it as a personal attack.  It's meant so that you can learn.  Gee thanks....   You seem to really care about your clients.

I don't do much life insurance except in conjunction with estate planning or business successions. 

All of your clients are going to die.  If you are going to be their financial advisor don't let another advisor get a piece of your client.  They will if you don't take care of the insurance issues for everyone.  This includes disability insurance and long term care insurance. This is true and why I am looking to bring on an associate who will specialize in the insurance side.

You have to constantly be on the phone to the Doctor's office to get the medical information in time.

Let the insurance company handle this for you.  This should not be an issue.  If the doctor's office is being slow, have the client call.  Releasing medical information is a profit center for the doctors.   The time frame to get the doctors office to repsond is too long and sometimes clients get cold feet on their insurance and back out.  The exeption of course is the estate plans where people know they need to be covered and stick with it.   The insurance companies put the policies in some sort of slow conveyor belt process and weeks go by before the check again.  I don't have the patience for this or the time to call the insurance companies and keep checking up on the progress.

The paramedics are usually backed way up in our area, thusly giving the client plenty of time for second thoughts. 

This shouldn't be happening.  The paramedical companies are in competition with each other.  Make them give you great service.  Preset the exams.  "Mr. Client, is Tuesday at 3:00 a good time for you to be examined or would another time work better?"  Then, with the client still in your office, call the examination company and say, "I have Joe Jones in my office.  We need an examiner to see him Tuesday at 3:00."   If the company that you are using is not giving you great service, pull your business from them.  Honey also works.  ie. Treat the parameds like gold.  They can be of great help.  You live in a different area than I do.  The closest paramed service is over 500 miles away and they subcontract to individuals who have to drive several hundred miles to do paramedic exams and do them at their convenience.  I have gotten the paramedic companies to send a kit to a local doctors clinic or the local hospital, however that takes time, and the client has to set up an appointment which can take days or even weeks.

Half the time the clients lie to you about their medical conditions and the underwriting comes in much worse than anticipated and the premiums are much higher than you quoted.   

You must take the blame for this.  This won't happen if you drill it into your client's head that all of their health history will be seen by the insurance company.  Tell them that you must know EVERYTHING about their history.  You are the expert and you will use your expertise to make sure that you use the best insurance company for that person based upon their health history.   Doctors and insurance companies look at things very differently. 

It also sounds as if you don't have the necessary expertise to match the right client with the right insurance company.  Your quotes should almost always be worse than what the client receives instead of the other way around.  Under promise and over deliver.  This is true. I usually quote at standard or even less if it is apparant that the client is not being forthcoming about their health. I also make sure the clients know that the quote is just an estimate and that the underwriters will determine the actual quote when they have looked at the medcial history.  When you become an expert in life insurance, you'll learn to sell coverage without giving a quote.   Right....you always buy things without knowing at least a range of prices?  

You need to monitor the policy to make sure it doesn't collapse if interest rates rise or if the variable accounts are tanking. You may need to ask the client to pay more premiums if they didn't overfund the policy in the beginning or decided to go on the cheap and just pay the bare minimum. 

Again, this is completely your fault.  Don't sell UL and VUL contracts.  The client almost always gets screwed on these policies.  I can't imagine a worse place to take risk (investment risk or interest rate risk) than in someone's life insurance policy.  Don't believe me?  Find one person who has had a policy for more than 20 years and the policy is not in danger of lapsing.  Sell life insurance for the guarantees.  Use old fashioned whole life and term insurance.  The only ones who do well with UL/VUL are the insurance companies. 

UL and VUL are especially inappropriate for the business and estate planning market.  The exception is GUL for older ages, but I'm assuming that you are not referring to this since you mentioned interest rates.

Large whole life policies for people who are in their late 50's are just too costly. GUL is a relatively new development. Better some insurance in a UL or even in a term policy than none at all. Many of the policies that I am looking at that are in danger are the older ones: ULs sold by a hit and run agent. The clients paid just the minimum premium and now need to put more in.  I agree that Variable Life is incredibly risky. 

You owe it to yourself and your clients to become an expert in these areas.  In the meantime, find a mentor. Have one. He is my up-line. Split the commissions with that person while you learn. 

There's a saying that I like.  "Learn for your clients instead of on your clients."  Don't let your clients be guinea pigs as you learn the business.

It just goes on and on and on.

I think we earn the money in life insurance

I'm too busy managing investment portfolios to spend another lifetime to become an insurance expert.  I realize that I don't want my clients to go elsewhere for their insurance needs, so I do offer it myself.  Even though I hate the process. 

Sigh....I really need to find that associate.