Try Profiling GMIBs Touted By
By Wyatt Blackmon
In todays competitive and ever changing market, it is important to “profile” the insurance company with which you are considering doing business and also its products.
As you know, to boost distribution and sales, many insurers rely on both internal and external wholesaling forces to accentuate a products positive features.
The process entails a type of profiling. That is, as part of the carriers strategic product marketing process, the ask detailed questions about the agents business. This gives the company a snapshot of what, who and how often the agent is selling.
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But it is equally important for agents to do the same thingthat is, ask detailed questions about the carriers products. Here is why.
Agents are solicited daily with claiming “best price,” “highest commission,” or “best living benefit,” to name just a few features. Yet pitches about these features and benefits often overlook the products intrinsic value and can sometimes influence business decisions.
To avoid possible mishap involving a clients investments, you should be asking key questions that define the product options bottom line.
For example: One of the more attractive features with todays variable annuities is the living benefit–specifically the Guaranteed Minimum Income Benefit rider. The GMIB rider, as it is called, guarantees the client a minimum lifetime income level, at a future date, if the option is elected. Typically the upfront guarantee is what sells this benefit.
Several companies attempt to hook you into selling products having this rider by offering an accumulated annual rate of 5%, 6%, or 7%. On the surface, most would say that a higher rate is better than a lower one. This is the logic that some agents fall into.