Which is precisely why HNW people don't bother with life agents. You know exactly what they are going to say.

First of all, there aren't too many wirehouse reps who aren't life agents.  Secondly, you are correct that the answer is going to be to buy more life insurance.  So what?  The attorney and the CPA are going to be involved in the decision and the purchase won't happen unless it makes sense. 

Look at the after tax rate of return on the death benefit of a life insurance policy.  If the purpose of the money is to leave money behind at death, there is nothing that will do it as well as life insurance on a risk adjusted basis.  This assumes that the client is healthy.

 

[quote=anonymous]

Which is precisely why HNW people don't bother with life agents. You know exactly what they are going to say.

First of all, there aren't too many wirehouse reps who aren't life agents.  Secondly, you are correct that the answer is going to be to buy more life insurance.  So what?  The attorney and the CPA are going to be involved in the decision and the purchase won't happen unless it makes sense. 

Look at the after tax rate of return on the death benefit of a life insurance policy.  If the purpose of the money is to leave money behind at death, there is nothing that will do it as well as life insurance on a risk adjusted basis.  This assumes that the client is healthy.[/quote]

Problem is a lot of them aren't healthy when they get around to getting the insurance.........

This is very true, most of us are life and health licensed now.  The only people in my office who aren't are the guys who have been around for a while and didn't see the need to do it.  A few of them are coming around now though.

But I don't think most prospects see us as life agents.  Which is a key differentiator for quite a few people I talk to.  I tell them that I'm life licensed, but I don't specialize in it.  For some reason, many of these people don't want to deal with a life insurance agent.  They know they need the insurance, but would rather go through me than a dedicated insurance agent.  It may have something to do with the reputation of the business, I don't know. 

[quote=anonymous]

First of all, there aren't too many wirehouse reps who aren't life agents.  
 

[/quote]

[quote=CAPM]

Biggest problem is that most estate planning attorneys I know think that the life guy oversells everything, and he/she will do it again..........:)

Most HNW folks I know have a team of 3 people:  CPA, attorney,and FA.  The life guy just does what the team tells him to.............

[/quote]

I can see you saying that the life guy is not part of the "team", what you may not realize is that alot of the agents with FA's are not only life agents but RIA's as well.  So if you are talking about an Allstate agent I agree with you, with my firm though that's just not the case.

ExProptrader,

You are correct.  The life agent isn't looked upon as a "life insurance agent".  He is typically looked upon as the financial advisor.  Most of the big life producers are either RIAs or are part of a corporate RIA.  We are not talking about the captive car insurance guy.

Clients are looking for solutions, not products.  If life insurance solves the problem, a sale is made.

[quote=anonymous]

ExProptrader,

You are correct.  The life agent isn't looked upon as a "life insurance agent".  He is typically looked upon as the financial advisor.  Most of the big life producers are either RIAs or are part of a corporate RIA.  We are not talking about the captive car insurance guy.

Clients are looking for solutions, not products.  If life insurance solves the problem, a sale is made.

[/quote]

I believe that most life agents are IAR's not RIA's.  There may be a corporate RIA, but the individuals out there in the agencies are IAR's.

If an agent is part of an agency, he would probably be part of the corporate RIA making him an IAR.  However, some agents that are part of an agency have their own RIA.  Also, many agents are not part of an agency and have their own RIA. 

You are correct with the word "most".  However, you may be incorrect if we are looking at the ones servicing the HNW, but I really don't know.

[quote=anonymous]

If an agent is part of an agency, he would probably be part of the corporate RIA making him an IAR.  However, some agents that are part of an agency have their own RIA.  Also, many agents are not part of an agency and have their own RIA. 

You are correct with the word "most".  However, you may be incorrect if we are looking at the ones servicing the HNW, but I really don't know.

[/quote]

I just find it to be unlikely that a guy who is a big hitter in life insurance is going to also open an RIA and manage money "on the side."

Too many irons in the fire to do both successfully.  I also think there are probably some "serving two masters" issues.

Can you be more specific--perhaps actually citing an RIA that is run by a guy, or guys, who are also big hitters with a life agency.

Putsy, the one thing that you don't seem to understand is that life insurance is sold and not bought.  Life insurance guys are great salesman.  It's easy to capture all of one's assets after getting them as a client.  (You're going to disagree and I have no way of proving that.)

Guys who sell a lot of investments are also great salespeople.  Great salespeople are great salespeople.  It makes sense to do both the investments and the insurance.  Lots of time, one of the partners is the insurance guy and the other is the investment guy.  Regardless of whether one is an RR or a RIA or a IAR, the one thing that a big insurance producer doesn't want to be is someone who has to put the sale through the grid.

[quote=anonymous]

Putsy, the one thing that you don't seem to understand is that life insurance is sold and not bought. 

[/quote]

I disagree.  Life insurance is something that everybody knows they should have--a mutual fund is not.

That is why life insurance companies will hire anybody who can make a mirror fog up--to get all the sales that that guy is capable of bringing in from friends and family.

Career agents learn to ask for referals and network--but I don't care how good a salesman you are if the client believes they have enough life insurance they won't buy.

Within the last day or two I posted that I don't even return my agent's calls because he has morphed from a guy who wanted to help me to a guy who wants to twist me.  That happened as he matured in the business and is finding it more and more difficult to find prospects.

He does not have a securities license and has missed that boat.

This, of course, is nothing more than my opinion and regardless of how much an insurance agents screams and stamps his feet I will continue to believe it.

[quote=DAtoo][quote=anonymous]

Putsy, the one thing that you don't seem to understand is that life insurance is sold and not bought. 

[/quote]

I disagree.  Life insurance is something that everybody knows they should have--a mutual fund is not.

Every client or prospect I encounter want to know what 'hot investment tip' I can give them.  Many of them, however, are not fit financially to invest.  I believe your thinking is backwards.  I come across more people who say stuff like, "My wife will work if I die early."  Or, "I don't want my kids to be spoiled, so I'm not going to buy life insurance.  All I want to do is invest."

That is why life insurance companies will hire anybody who can make a mirror fog up--to get all the sales that that guy is capable of bringing in from friends and family.

Why wouldn't you want to sell insurance to your friends and family?  I sure as hell wouldn't want to be the person who didn't approach a family member with what I have to offer, only to see a premature death or disabiliity.  That is a burden I don't want to have.  And oh by the way, I do not only ask my friends and familiy.  I cold prospect ever day.

Career agents learn to ask for referals and network--but I don't care how good a salesman you are if the client believes they have enough life insurance they won't buy.

Wrong.  Life insurance enhances all a client's assets.  I know how to present it in such a way that they want to buy more life insurance.  It's not just about providing a death benefit - whole life insurance is a great tool as part of an overall plan.

Within the last day or two I posted that I don't even return my agent's calls because he has morphed from a guy who wanted to help me to a guy who wants to twist me.  That happened as he matured in the business and is finding it more and more difficult to find prospects.

Sounds to me like he doesn't prospect like he used to.  A shame, really.

He does not have a securities license and has missed that boat.

Weren't you the one who brought up "Jack of all trades...?"

This, of course, is nothing more than my opinion and regardless of how much an insurance agents screams and stamps his feet I will continue to believe it.

That's fine.  If you choose to be ignorant about something, there's nothing I can say or do to change your mind.  I, fortunately, choose to work with motivated, open-minded individuals who love their families.  Business becomes easier and more enjoyable that way.

[/quote]

I disagree.  Life insurance is something that everybody knows they should have

You're right, but only very partially.  Most people do know that they should have it.  They have no idea how much that they should have. 

but I don't care how good a salesman you are if the client believes they have enough life insurance they won't buy.

If they have enough, they shouldn't buy, assuming that it is properly structured.  Many people think that they have enough.  Very few people do have enough.  I'm always selling insurance to people who think that they have enough.   A typical client of mine might be earning $150,000 and have $1,000,000 of life insurance when we first meet.  They think that $1,000,000 is enough.  We'll talk about how much money that their family needs on a monthly basis.  Maybe it is $7000 after tax.  Once they realize that $1,000,000 won't be enough to support their family in the manner that they want, they buy more.  Also, term insurance is so inexpensive, it simply doesn't make sense for a young family to not buy a lot.

I find investments to be much easier to sell.  When someone buys XYZ mutual fund, all that they've done is moved money from their left pocket to their right pocket.  When someone buys disability insurance, that money is gone.

Within the last day or two I posted that I don't even return my agent's calls because he has morphed from a guy who wanted to help me to a guy who wants to twist me.

Your agent sucks and doesn't have a full pipeline.

 

Either way, DAtoo pointed out in this very thread that he didn't know that you don't have to take a medical exam complete with interview, bloodwork, and urinalisys to get a variable annuity.

What does that say about his credibility?

[quote=DAtoo][quote=anonymous]

Putsy,

Do you think that insurance companies are stupid?  If the insurance agent was simply brought to the table to fill out the application, do you really think that the insurance companies would have to pay out 100% in first year commission?

They pay out the commission because in the vast majority of cases, the sale would not be made without the insurance salesman pushing the idea of the insurance in the first place.  

Top insurance producers don't make millions by filling out applications.  They put everything in motion.

[/quote]

Insurance companies cannot be bright or stupid--they're an institution without measurable intellect. 

The agents generally range from high grade morons such as one finds on that top gun producers website to very bright.  I'd say that 50% are high grade morons, 40 percent of average intelligence and 10% bright enough to comprehend what an average stockbroker in 1975 was doing.

How much money one makes is irrelevant--Mike Tyson earned a lot of money too.

[/quote]

Here is where you have erred in your thinking DAtoo. Insurance companies like any other entity can and are in fact intelligent entities. The Knowledge economy has been with us for slightly more than 20 years. We are more service oriented and this is forcing those entities who wish to achieve or maintain sustainability to adapt in how they value what drives their business. Cost accounting has begun to slip into its proper place in the past. Labor costs  are now becoming intellectual assets since no amount of cost accounting based decisions will ever create sustainability. Most industrials are now realizing this folley as they leave China for Malaysia, Vietnam, and Thailand for even cheaper labor. Eventually steel and resin factories in the Northern Sudan will be the end result of just how low can you take labor. Those that have wised up are now actually seeking to increase their labor expense in the hunt for knowledge workers.

In any case, I felt the need to correct you on at least this issue.

DJ