A big reason agents fail is a lack of attention to their existing book of business. Building relationships with your clients is the lowest cost and fastest way to generate leads and cross selling opportunities. We use policy reviews as one of the ways we regularly stay in touch with clients and generate new ideas for them.
Life changes and it’s your job as an insurance producer to help your clients make educated decisions regarding their insurance and financial planning. Many times when you meet with a client for a policy review you will find they have experienced some life changes:
- Newly married of divorced
- Purchased a new home or welcomed new children to the family
- Started a new business
- Received an inheritance
- Have a need for living benefits
- Had a death in the family
Conducting life insurance policy reviews is a very easy process and is something we typically encourage agents to do annually (unless a life change occurs that requires immediate action). Based on your findings you will either find they are up to date and require no further action, or you will find the policy is not performing and alternatives should be considered. In either scenario you are doing your client a service by making sure they are comfortable with the protection they have in place.
Below are some of the key pieces to collect when conducting life insurance policy reviews.
- Client date of birth and gender
- Additional insureds on the policy
- Policy owner contact information if other than insured
- Beneficiary Information
- Underwriting class and any health changes since approved
- Purpose of the insurance (survivor, estate taxes, business planning, retirement income, legal, etc.)
- Policy Number, effective date and policy type
- Insurance company name
- Death benefit amount
- Original purpose of insurance
- Does purpose still exist? Has it changed? If so, provide details.
- Premium amount, payment frequency, number of years owned
- Current interest rate and guaranteed interest rate (if applicable). This is used for whole life and universal life policies.
- Options (level, increasing, graded plan)
- Current cash value, net cash surrender value, cost basis
- Any active loans, amount, interest rate, status, plans for payback (if any)
In-force Illustration Requirements
- Same premium and benefit amount at current interest rates
- Same premium and benefit amount at______% assumed interest rate
- Solve to pay premiums for ____years to attain $__________cash value at maturity
- How long will you require a death benefit?
- Age____, Age 100, Beyond 100, Other?
- How many years do you plan on paying premiums? 5, 10, 20, etc.
- Prioritize objectives
- Accumulate cash to supplement retirement income
- Death benefit
- Concerned about price only, no cash value
- Any goal changes since purchase date of policy
The next step is critical. We encourage agents to ask the client if they can take a few days to analyze what they’ve learned and get back to them with recommendations. This approach has two benefits. First, it shows that you want to be thoughtful about their situation rather than leaping to solutions on the spot. Second, it almost guarantees you will get another meeting.
After a few reviews you will realize the value and that you have strengthened your relationships and opened opportunities to further build your business. Your client’s loyalty to you will increase and they will appreciate your attention to detail and genuine concern for their changing needs and goals.
Start scheduling policy reviews today.