Patti didn’t realize what it meant when her life insurance company sold off her policy to an investment group. She didn’t know the dynamic had changed and that her best interest was not as important to the new owners as it had been previously. Unfortunately, the focus now was more on minimizing the company’s liabilities and maximizing its profits.
One way a company accomplishes this is to outsource servicing. There’s a cost savings for the company. But now the folks on the other end of the 800# aren’t able to offer any guidance. They’ll respond to questions but aren’t able to offer insight into the direction or the health of the policy. The combination of that diminished level of service and lack of guidance greatly multiplies the possibility that someday in the future Patti’s policy will be one of the 80% of policies that will fail to pay a beneficiary.
Potentially, this presents the investment group with an additional way to maximize profit. For your consideration, let’s look at the math from their point of view.
Patti’s paying $5,700 a year for a $500,000 death benefit. If the policy were to go away, the company loses $5,700 a year in income. That’s bad. However, it would also then lose the $500,000 liability. That’s really good for their bottom line.
So, unfortunately, poor service can help the bottom line in more ways than one.
It doesn’t have to be that way. The solution is simple. Her policy is one of the 80% that would greatly benefit from a periodic checkup. She already gets one for herself with her doctor. She also gets her car serviced regularly. She even gets her vision checked annually.
Why not add that life insurance policy to the list as well?
Patti needs an objective and thorough review for the clarity and certainty it can provide. This will let her know if her policy is in good force, if it needs to be updated, or if the clock could be ticking toward its demise. We recommend everyone have their life insurance policy reviewed (get a check-up) every five years.
This way the benefits will go to Patti and her family, not the insurance company.
If you’re not certain a policy is in the 20% that are safe, it’s probably in the 80% that are at risk. That’s why it’s a good idea for you and your clients to get a qualified policy review.
Independent Policy Review
The insurance world can be difficult to navigate. Without a clear understanding of their current plan, it’s difficult to be certain that your clients have the right coverage. If you’d like to take a closer look, you’ve come to the right place. We can answer your life insurance questions and provide the clarity you need to sleep easy. Learn more about our services or join our newsletter today. To contact us, click here.