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Kiss This

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When I was a young kid, growing up in the 1970s, Kiss was more than just a rock band. It was almost an urban legend, a thing of myth. They weren’t just one of the world’s biggest rock bands, but because their members were never seen without their outlandish makeup and costuming, they took on a weird kind of superhero persona.

This was the point, according to Gene Simmons, the band’s bassist and in many ways, the most iconic member of the band. Sporting what can only be described as a demonic mullet/topknot, monstrous makeup and an unusually large tongue that he liked to waggle at the crowd, Simmons was the living embodiment of what Kiss was trying to achieve with its stage show. Nobody knew that he was just a regular kid from Israel who came to America, fell in love with both rock and roll as well as comic book superheroes and sought to fuse the two.

There was always a cagey entrepreneurial nature to Simmons, who seemed to know how to make the best of the band, how to reinvent it in the 1980s, and how to reinvent himself as he aged out of rocker status and into the role of one of reality television’s reigning patriarchs on the hit reality show Gene Simmons Family Jewels. Now, Simmons is looking to reinvent himself one more time in what might be his most unlikely metamorphosis: selling life insurance.

Last year, Simmons helped form Cool Springs Life Equity Strategy a boutique firm that provides very high-end life insurance premium financing for very high-end clients. One immediately gets the notion that with a personal network as extensive as his, he won’t have to look to hard to find clients.Plus, Simmons has always been a savvy businessman. Just as he’s getting into the insurance business, he’s also partnering up with an online translation service to let fans connect with celebrities across the world, regardless of language. And that is just one of many irons he keeps in the fire. Like I said, savvy.

On the face of it, this really does not seem all that different than any other agency startup; working the people one knows to sell them a product that everybody really needs but few seem ready to procure without a little encouragement. What makes this story a bit different for me is just the financial scale of it.

Here we have a very rich guy (presumably; there are plenty of high-flying celebrities who are actually broke, but it doesn’t look like Simmons is one of them) who is making sure that his equally rich friends and associates take the steps necessary to preserve their wealth across generations. It is a core function of life insurance nowadays.

And it’s not just Cool Springs’ clients that benefit from Simmons’ involvement, either. Since his entry into the life insurance world, Simmons has become the firm’s chief front man, using his star power and charisma to promote the firm wherever he goes, and to weigh in as a colorful pundit on the political challenges to life insurance and financial planning that have rocked the industry in recent months.

But with individual life insurance levels recovering slowly out of its historic low ebb, the advanced market seems an ever more attractive target for agents who are looking to earn bigger and better commissions for themselves. There os nothing wrong with that, of course, but where it bodes ill for the industry at large is when more agents are going after a smaller body of high net worth clients for financial and life planning, we begin to get a bottleneck of industry focus that leaves a lot of potential policyholders behind.

The life insurance industry currently only accounts for about 30% of the total revenue of the life & health market, according to the Insurance Information Institute’s latest numbers. I have lost track of how many times I have read, or listened, to life insurance professionals lament how underinsured the public is. And they are right. The public is deeply underinsured. And while that is a problem the public itself needs to sort out for its own good, as far as the industry is concerned, why keep chasing the HNW crowd so much when there is such a huge field of untapped opportunity just sitting there, waiting to be sold to?

There are plenty of reasons of course, just as there are innovative market leaders tapping that market right now, selling plenty of life insurance to middle- and low-income policyholders. But so much more could be sold. And as I look at Gene Simmons selling platinum-plated policies to folks as they’re walking from their Bentleys to their G5s, I cannot help but wonder: why sell to these folks at all, really? As much as their business is worth, wouldn’t it be more valuable in the long run, and more sustainable, to direct product innovation and sales strategies toward the largest possible body of policyholders?

I suspect that the commissions-based nature of life sales stands in the way of this. But if that is the case, then it is only a matter of time before a larger number of carriers decide that simplifying life insurance offerings and selling them direct to the public by phone or over the internet is the wave of the future. I have spoken to plenty of industry analysts who feel strongly that such will be the case in as little as five or 10 years. And if that is so, then the chase after HNW clients is the sort of game that will only accommodate a limited number of players. Everybody else will have to figure out what the future holds for them in the life business, if at all. And one thing is certain; nobody is very likely to figure out what it is trying to shoulder their way in front of a gazillionaire with an unsigned life policy in hand.