The Industry Has Become Alices Restaurant

Many of you, I know, dont like to be reminded of the 1960s, that explosive decade when everything that the 1950s held dear seemed to go up in smoke (of one kind or another). But, in going through the stories on insurance riders in this weeks issue, I was reminded more than anything else of one of the anthems of the 60s. So, even if you dont want to, youll probably remember Arlo Guthrie and his famous line, “You can get anything you wantat Alices restaurant.”

(Just as an aside, however, even if you hated the 60s, youd probably rather remember Arlos tune than another great anthem of that decadethe Rolling Stones “You Cant Always Get What You Want.”)

But back to the issue of riders. Like it or not, in this area, at least, the industry has become Alices restaurant. And this is a good thing. Because, just like at Alices, what the industry is presenting to clients is a vast smorgasbord of choice and satisfaction.

Take a look at the stories in this issue and its obvious that someone has been very busy in the industry kitchen when it comes to cooking up variations on the rider recipe.

We had a lot of fun with the cow on the cover and keying the riders to the various parts of the animal. But believe me, we probably left out more riders than we were able to fit in. The number seems to be growing by the hour.

When you consider all the rider permutations for life insurance, annuities, long term care and various other products, its no wonder that some advisors are feeling bombarded. Or, to continue with the motif, feeling like theyre being chased by a herd of stampeding cows.

Not only do advisors have to master what each rider does, they have to be authorities in conveying to their clients what the benefits are in and of themselves and what the benefits are in relation to the riders cost.

This can be daunting in an Alice in Wonderland kind of way. (Remember Jefferson Airplane?) Youve wandered into the Forest of Guaranteed Minimums and have become a bit disoriented. Is the way out via that grove of guaranteed minimum income benefits? Or should you take a right at the cluster of guaranteed minimum accumulation benefits and then another right at that stand of guaranteed minimum withdrawal benefits? Or should you just take shelter under the canopy of the guaranteed minimum death benefit and hope the Cheshire Cat will smile on you?

Then theres the question of riders that come pre-packaged or those that the advisor has to customize for the client. In a sense, its very much like buying a cut of beef. You can go to the supermarket meat cases where the prepackaged goods are there for the taking. Or, you can go to the butcher and tell him what you want. But in the latter case, you will have to know the difference between a sirloin and a porterhouse.

Indeed, it can get even more particular than that. You say you want a London broil. But do you want a top round or a shoulder cut? Same name, big difference in taste.

But perhaps youre getting full with all the talk of beef. So, lets moo-ve on.

For consumers, this feast of innovation that the industry has spread out spells choice, and that is what makes the rider explosion so appealing. When taken through the menu by a skilled advisor, consumers can put together an insurance meal that satisfies their appetite and their wallet.

And choice plus satisfaction is what its all about. Go ask Alice.

Steve Piontek

Editor-in-Chief


Reproduced from National Underwriter Edition, June 4, 2004. Copyright 2004 by The National Underwriter Company in the serial publication. All rights reserved.Copyright in this article as an independent work may be held by the author.