BenH's comments

Would Your Family Survive Without You?

21 Mar 2008 07:37 PM

As an accountant and a financial advisor I unfortunately hear stories that are very similar to this one way to often. Over the course of my career there are three people that I have met that mimic the story above. I understand that life insurance is expensive. But it really is a necessity. I try to convince people that they need life insurance but due to my position as a financial advisor I think people are often just thinking that I'm only trying to make money off them by selling an additional insurance product.

It’s very easy to persuade people to purchase Disability insurance (I think disability insurance is very important). Most employers offer a plan that covers 60% of the employees’ salary. It’s not hard for my client to figure out that I'm right when I tell them "you couldn't make it off 60% of your salary". But the biggest selling point is that disability insurance is affordable.

Most of my clients are not rich they are just hardworking people that are trying to be financially responsible. Many of my clients reject life insurance for the following reasons:

Term Life Insurance- There are no benefits if I don't use it. "My money is just gone after the term". Whole Life Insurance- Its way to expensive

The two methods that I have used to overcome these barriers are finding very cheap term life insurance products. Of course there are some drawbacks like poor customer service and the unstableness of the insurers’ future economic outlook.

My best course of action has been promoting hybrid term life insurance products (I may have made that term up). These products act like term life insurance but allow you to convert to whole life insurance products down the road. The conversion process allows you to recapture a portion of your monthly term life insurance premiums and put them towards your whole life insurance investment vehicle. I have had success with this format and I feel good when I can help somebody make a smart financial decision.

I have designed a website www.life-and-car-insurance.com that explains these hybrid life insurance plans in more detail. The site does not have a bunch of Google ads or any monetization models but rather good life insurance advice. I’m using it as a learning tool for myself and a reference guide for my clients. Currently AIG is the only hybrid life insurer I have on the site. But I'm currently looking for more quality life insurance companies that promote these types of products.