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August 26, 2001 at 08:00 PM
To achieve maximum success when selling VUL, producers will want to keep in mind eight aspects when evaluating the suitability of VUL for prospects (of all ages), the quality of the VUL product, and the support behind it that helps producers build and maintain a clientele.
1) A demonstrable and agreed-upon need for life insurance death benefits should accompany the prospects desire for accelerated wealth accumulation. Whether the death benefit need is for income replacement, estate liquidity, to fund an executive benefit plan, or for some other purpose, a need for life insurance must be a dominant motivation. Otherwise, investors would be better off investing in the funds directly–its less expensive.
2) Prospects should be future-oriented. Long-term performance should outweigh their short-term liquidity needs. VUL insurance is not for those people who desire to access their funds in a short time horizon.
3) Contract design flexibility, features and benefits are of utmost importance to reassure clients, to meet future contingency needs and to provide value (for example, no-lapse guarantees, the ability to rebalance assets in subaccounts, dollar cost averaging, or low net cost loans). Producers would do well to explain features and sell benefits, emphasizing the contracts benefits over its illustrated performance.
4) Choices among several quality and well-known equity funds with strong management and performance histories–while no guarantee–provide prospects the best chance to meet their financial security and accumulation objectives. When policyholders can choose among 30 or more investment subaccount funds, producers gain a competitive edge, particularly in a period of equities market volatility.
