Open doors to new sales with policy reviews, part 2

With 70 to 95 percent of irrevocable trusts having no servicing agent, policy reviews with clients can open doors to new sales opportunities. In part one, I listed some questions to ask when initiating a policy review conversation with your clients. Here are two more questions you can ask:

“Have your needs changed?” Many clients go through a divorce or enter into a blended-family situation. In these and other similar instances, often beneficiaries need to be adjusted. Perhaps the client had a sizable estate a few years ago when it was first purchased the policy and estate have since grown — as most do — even at conservative estate growth projections. In cases like these, your clients clearly have a need for additional coverage, especially considering the estate tax’s uncertain future.

“Who is managing your ILIT?” Almost 84 percent of professional ILIT trustees have no guidelines or procedures for handling trust polices, and 71 percent of nonprofessional trustees have not reviewed their policies within the past five years, according to the Journal of Financial Service Professionals in July 2005.

There is a clear and definable need for trustees to review life insurance assets held in trust, but as evidenced by this statistic, many have no idea how to conduct such a review. This is where your knowledge as a life insurance expert adds value to the relationship with your current or new clients as a trusted advisor and insurance consultant versus an “insurance salesman.”

For more articles on life insurance and policy reviews, see: