I learned something from a client.

[spacer height=”10px”]

By David Schaeffer

[spacer height=”10px”]
Ever meet a person that doesn’t take no for an answer? It is not often that someone brings up a planning tool that is off my radar. But it happened last month. I was so excited, I wanted to share what I learned with everyone. As many of you know, we launched a new division at American Retirement Advisors called www.123EasyLifeInsurance.com. We have always offered life insurance as an element in our comprehensive planning process, but it has never been something we actively market until recently.

[spacer height=”05px”]
Kris Sollenberger heads up the department along with support from the planning team, marketing, engineering, and me. It’s my pet project. I really want to help younger folks that we currently do not serve. I figured estate planning for families in their early 40s would be a great place to start. They typically don’t have a bunch of extra money to invest yet, but they have needs that can easily be addressed with life insurance products.

[spacer height=”05px”]
Back to what I learned… one of our Medicare clients asked if we can help with life insurance. I said, “You bet!” I figured this was going to be easy. I would introduce Kris and hand it off. This would get him a client to help and they would have a dedicated life planner at their service. Well, let’s just say we learned a thing or two. First off, we had a super patient, but equally demanding, client. They were correct in every aspect of their expectations. They asked for every conceivable combination of quotes imaginable. We delivered. Then they came up with a great idea. They needed term insurance for a period of time and then a permanent policy for final expenses. That’s a pretty normal planning strategy.

Normally, a $25,000 policy used for final expenses is only offered as a whole life policy. Those rates at age 65 are usually fairly expensive. I usually recommended a savings account equal to the premium and keep the money in your control. After 8-10 years, the savings will amount to the death benefit with smaller final expense whole life products.

[spacer height=”05px”]
Here is where I went to school. The client suggested a Universal Life policy with a guarantee that it will never lapse. We use Guaranteed Universal Life all the time for estate planning in amounts of $100,000 to multi-millions, but I never heard of a policy offered under $100,000. Guess what, the same company that offered our clients the lowest premium for their large term policies just so happened to offer a $25,000 (GUL) Guaranteed Universal Life Policy.

[spacer height=”05px”]
Lesson to learn… NEVER ASSUME! We always research every policy, from every carrier, every time a client asks for research. It’s a good thing because I would have never guessed that policy actually existed. The best part is, the smaller GUL policy was significantly less expensive than a similar value whole life policy and the full death benefit is available to the family as soon as the policy is issued and the premiums are collected.

[spacer height=”05px”]
Everyone can learn a thing or two, just gotta do the research.