Insurance 101 help needed
My first life insurance cases I ran a Hartford illustration, had the client fill out the application and then waited for offer. Not good.
Lately, I’ve been trying to do some preliminary underwriting myself, then calling an insurance brokerage and getting help in ‘shopping’ that profile. That’s resulted in more competitive quotes, but you still have the issue that if Company A surprises you with a higher quote, you have to ask the client to go through the whole process again with Company B, and C. You also have the issue that some prospects don’t want to tell you about their health history or what medication they are using, and I’m not experienced enough to know exactly what to ask in some cases.
Wouldn’t it be great if there was a central clearinghouse where you could get your client medical checked and then shop for the best deal.
Am I missing something? Is there an even better way to do this?
You’re missing a lot.#1 - Quotes are MEANINGLESS until an offer is made. Until then, you can manipulate illustrations between companies and products forever. It just doesn't matter. #2 - Even if you asked all those questions, there can still be other notes in their medical files that can still foul up your case. All that other work will be for nothing. The problem is in how you are THINKING about life insurance. Applying for life insurance is like applying for a bank loan. The bank may have a low advertised rate. But there will be certain criteria to get that rate. You must still submit an application, allow for underwriting (credit & financials) and wait for a response. If you're declined, you apply somewhere else - that is, if you really want the loan. Life insurance is no different, except we're adding the client's medical records, prescription records and current health. When you're selling life insurance, you need to tell the client that "we're going to apply to see what we can get for you and then we'll compare offers." BTW, the "best deal" does NOT mean the best price. It means that the client will be accepted by the insurance company as an acceptable risk. So ALL OFFERS are good deals because the company is making an offer. Now you just get to help the client CHOOSE. Think of yourself as the "lending tree" of life insurance! :)
Have the client sign a HIPAA form to release the medical records and lab work from your client, then you can rate shop every single carrier out there to see which is more favorable. When the “cheapest” or most “valuable” comes back with a tentative offer, then you have the client actually apply. It’s not that hard if you bring the HIPAA form with you on your closing appointments.
If you’re quoting “preferred best” rates to your client and then you’re suprised with what comes back, don’t be suprised. My approach is simply here’s the standard rate, it may come back better, but let’s apply first to see what we get for an offer. I also have the client sign a HIPAA form.
Have you truly sold the need for the insurance?
If you have the need sold the difference in the ratings should be a make or break!!
Like full throttle says quote a std rate and let them know that the underwriters will do work hard to get them the best possible rate base on their personal risk. Which is very true!
Price is one thing Value is another!!
I’ve found an insurance brokerage that helps me shop the preliminary underwriting. In the past couple of weeks I’ve been asking people their weights, medical history, medication levels, etc. I thought it would be awkward, but it hasn’t been.
Been trying to avoid surprises once they actually get formally underwritten and receive an offer.
I ask the same questions (and more) and still will only quote standard before underwriting is finished. In fact, I’d say it’s 50/50 where I even give a quote. When a client or prospect asks how much it will cost, I answer “It will be an amount you can easily afford. I’m not trying to be flippant, but until we have a firm offer from an insurance company, it makes no sense to talk about premium. For all I know, you could be denied. Let’s get the process started, fill in this application, when can the nurse come out, etc etc.”