There’s no doubt that Americans are underinsured with regard to life insurance protection.

In fact, nearly 50 million Americans say they need more life insurance, according to recent research from LIMRA International, Windsor, Conn. And these potential customers don’t need more life insurance protection for only 10 or 20 years–they need coverage all along.

Most customers won’t be able to articulate exactly what type of insurance they need. However, it’s certain that they do want flexibility and options with whatever they buy, whether it’s life insurance protection or an esoteric investment such as a timeshare property.

Because of this, it takes more time and effort for the advisor to explain to a customer why, most of the time, premium shouldn’t be the only determinant of a life insurance purchase. The customer needs to understand that people really do get what they pay for with life insurance.

Unfortunately, many agents are concerned that unless they sell the lowest cost premium proposal, they’ll lose the sale and someone else will come in the door behind them with a lower premium.

In reality, if the agent only sells the lowest cost premium, the agent may make the initial sale but ultimately lose the customer.

To be more successful, modify the selling process a little bit by providing a true competitive advantage: Focus on the whole product, not just the price.

For example, discuss all the living benefits available–such as tax-deferred accumulation, tax-advantaged distributions, coverage for long term care on a tax-advantaged basis, perhaps even being able to provide coverage for unemployment or disability coverage–all in one contract.

Tell customers that while others may seek to win a sale by showing a purported lower cost, that product will come at a price–i.e., low or no flexibility. Being upfront this way knocks out the competition from the start.

Many sales are made today focusing on a no-lapse guarantee rider attached to a universal life contract. This is a purely transactional sale focused on premium.

In the spirit of full disclosure, I will mention here that I own a UL-with-no-lapse-guarantee contract. However, I knew going in exactly what the downside was: I have very little flexibility, and the cash that does accumulate isn’t accessible unless I want to lose the no-lapse guarantee. Yes, my premium is fixed, but it’s fixed for life, so no matter what interest rate is credited, my premium can never go lower.

Some might say I could always pay more to pay it up earlier. Yes, I could do that. But, why bother, since the extra cash means nothing (for the reason stated above)?

Ah, some may say, but there is an unlimited make-up provision in that contract. Well, yes, there is. But, tell me, if I miss the annual premium payment in year 5 and want to make it up in year 15, can I get an answer from the insurance company within 24 hours about what it would cost to do that? Can any agent really present that to me with a straight face? It’s so expensive that I would say it’s really a non-benefit.

The life insurance industry–the agents and the companies–needs to communicate better the advantages of cash value accumulation life insurance.

This doesn’t mean every sale should be whole life or indexed UL. After all, different products perform differently based on the customer’s risk profile and ultimate time horizon.

But the sale should factor in the reality that customer needs do change. In the longer term, many customers will appreciate having flexibility built into the contract concerning guarantees, additional accumulation potential, tax-advantaged loans/withdrawals, retirement income, etc.

The best and most memorable sales are the most difficult ones–those where the agents knew in their hearts that this was the perfect plan for the customer but where the customer just couldn’t make the decision to buy until the agent explained all the features and benefits. These sales don’t involve commodity-like products such as term life or UL with no-lapse guarantee riders, where transaction and premium are the focus. They do involve winning for the long term.