Bottom line: Make sure the customer’s life insurance is still covering them

Change is inevitable. Our clients’ lives are constantly changing, and as their financial professionals, we recognize that their financial needs and goals change as well. By regularly reviewing their portfolios, we help ensure that their mix matches where they are in life and where they want to go. However, one important part of their overall plan is often overlooked in this analysis – and that part is insurance.

For customers who have participated in a life insurance policy, the policy that follows often gives them confidence and assurance that their current needs and concerns will be addressed by the death that the policy provides. But life insurance planning isn’t a one-size-fits-all approach – just like every customer, their policies need to be reviewed as their needs change over time. Especially for customers who have a major life event, reviewing their policies can provide an opportunity to ensure that their insurance still meets their goals. Major life events may include:

  • Marriage
  • Birth of a child or grandchild.
  • Death of a relative.
  • Retirement or career change.
  • Caring for an elderly or sick family member.

Any of these situations may result in the need for a change in the customer’s life insurance policy. For example, customers who purchased annuity plans in the early days of their careers may not want as much support after retirement. Or, if they have more real estate, they may need more life insurance to cover the mortgage payments, including property taxes.

In addition to changing their planning needs, life insurance carriers often make changes to new and innovative products that appeal to customers but were not available when they first purchased.

Carriers often change their prices as well. Consider the customer who purchased life insurance 20 years ago before long-term care drivers were available. Twenty years later, the prospect of a medical event requiring serious care may be at the forefront of the client’s mind. By looking at the old policy and comparing it to new policies that include critical care or long-term drivers, financial professionals can help the client plan for whole life and death coverage with a single policy, often at the same or lower cost than the original policy.

Starting a policy review is easy – ask your customers for their latest insurance policy and set up a time to review their goals. By working with a financial professional, clients can determine whether their current needs match their existing needs. Next, compare the policy to what’s available today – can clients find a death benefit that suits their needs now? Will they pay less or find a new product that is more suitable for their purposes?

The value added to clients by promoting the right to their income or finding them a better alternative leads to change in their lifestyle and strengthens your relationship with them as their primary source of financial guidance. Life insurance quotes also give you the opportunity to build relationships with potential beneficiaries who will look to you for support when the policy pays them benefits.

Change may be inevitable, but by dealing with the changing goals that come with change, we can help our clients be ready for life, knowing that their goals can be met with your guidance along the way.

Carma McCallie, JD, is vice president, senior sales, with Crump Life Insurance Services. Carma can be contacted at [email protected].

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