I read an article in the latest issue of Money magazine over the weekend that made me frown.
“College aid: Don’t take the bait,” by Kim Clark, took a look at various life-insurance-as-college-funding techniques and found them to be, for the most part, lacking. And in many of the cases the article cited, life insurance and annuities didn’t just fail to help the families involved, they also made their financial situations significantly worse.
Needless to say, the story didn’t paint life agents in a positive light. Those featured in the article came off as unscrupulous fear-mongers looking for a quick buck. Some of them ended up being fined and/or jailed for selling inappropriate insurance products.
Villainous, evil people, right? Well, maybe. Maybe not.
In some ways, I kind of felt sorry for the agents involved. It sounded like many of them attended seminars that taught how to sell these policies and then they just followed that advice.
While it’s easy to condemn the agents as moneygrubbers, it sounds to me like at least a few of them were simply under-educated and a bit misguided. Unfortunately, in a field where you’re selling products that can make or break families financially, that’s a dangerous combination.
We talk a lot on this site about the need to educate clients, but it’s essential that agents educate themselves, as well. While life insurance can help with college funding in a few cases, it has to be considered as part of every family’s larger financial picture and unique situation. Actually, that’s true of life insurance in every case. Financial products aren’t one-size-fits-all solutions, no matter what a seminar tries to tell you.
You’re in a difficult spot as a life agent. You’re a trusted advisor … who also makes a living on commissions. You have to educate clients about complex products … maybe with very little training yourself. It can be easy, especially in tough economic times like these, to believe an official-sounding marketing agency that offers the key to fast, simple, people-helping sales.
But, as with everything, if it sounds too good to be true, it probably is. And learning that lesson might be the best education of all.
For more from Corey Dahl, see: