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Advisors: Discover new sales opportunities with policy reviews, part 1

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Are you an order-taker or an insurance consultant and trusted advisor to your clients? It has been estimated that 70 to 95 percent of irrevocable life insurance trusts have no servicing agent, according to the Journal of Financial Service Professionals, July 2005. It seems that said agent would want to maintain an ongoing relationship to service his client should their needs change in the future. And with the recent extension of the Bush-era tax cuts and the new estate-tax exemption levels, now is the perfect time to discuss reviewing life insurance policies for all your clients.

Initiating the conversation

What are some ways to open up the conversation with clients? You can simply ask them, “Do you have the old kind of insurance or the new kind?” This question will certainly pique their interest, at which point you can explain that life insurance rates have dropped dramatically in recent years and new products and concepts are available to serve the needs of our clients better.

Would your clients appreciate paying fewer premiums than they are currently paying? Would they value your advice on an ongoing basis? The answer to these questions is clearly yes. Following are some additional questions you can ask to begin the conversation with your clients to ensure their life insurance needs are being met.

“What is the state of your policy?” This question is deliberately very open — either the client will have an answer or will ask for some clarification on what exactly you mean. By positioning the question in this fashion, you can find out what kind of policy the client has, whether it is term, variable, universal or whole life. Is the policy performing as expected when it was originally illustrated and sold? Is the death benefit guaranteed for as long as your client lives? Is the policy in danger of lapsing due to underperforming subaccounts in a variable contract or interest rates that have not kept pace in a universal life contract? Is the carrier still financially stable and strong after the last few years of economic turmoil?

“Should you renegotiate your health?” Advances in medicine, and, in turn, underwriting guidelines have allowed for certain medical conditions that required table ratings as recently as just a few years ago to obtain more favorable underwriting, thereby reducing premiums. Prostate cancer, for example, was long considered a rated medical condition. But now, certain carriers can offer premiums as good as preferred rates. Many other cancers are now being viewed differently as a result of new medical technology and treatment.

Many things change in our clients’ medical lives that can affect their life insurance coverage. Perhaps a client quit smoking and can now get non-smoker rates, or maybe your client has term insurance and her health has changed for the worse. Now would be a good time to convert that coverage to permanent insurance before their conversion period expires. If you, their trusted advisor, don’t review that coverage, it’s possible that they’ll miss out on that opportunity and you’ll miss an opportunity to really help a current or prospective client.

There are two more questions you can use to initiate a policy view conversation with your clients – look for them next week.

Joe Cvetanovski is owner and principal of Visionary Marketing Group, a life insurance and annuity brokerage agency. For more information, go to


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