Life Insurance - Learn From an Old Agent

Life Insurance is an insurance that pays for the death of the insured. It should really be called "death insurance", but people do not like that name. But he said the death of an individual. Actually, what is covered, what is the economic loss resulting from the death of the insured.

These economic losses have many different ways, such as:

- The proceeds of each "head of family" in family
- The loss of the services of the family of a housewife, mother
- A final cost of the death of a child
- The final cost of a person after an illness and medical treatment
- Envelope "Keyman", which means that the owner or employee of a company worth against the financial losses the company would suffer the death ensured
Estate Planning insurance pay when a person is insured in case of death of inheritance tax -
Is purchased "purchases and sales agreement" in the life insurance to fund a commercial operation in the premature death of the parties to the transaction -
- Accidental death in which a person buys a policy that pays in the event of death due to accident
- Mortgage life when the borrower a policy that pays the mortgage on the death insurance purchases - and much more.

Life insurance has been around for hundreds of years, and in some cases a better quality product. The insurance companies have actuarial tables to develop the study of statistical models of human mortality in the time ... Usually a life span of 100 years. These tables are surprisingly accurate and allow insurance companies to accurately predict the number of people of all ages die every year. From these tables and other data obtained insurance companies, the cost of insurance.

The costs are usually brought as an annual cost per thousand of coverage expression. For example, if you want to buy $ 10,000 coverage and cost per mile was $ 10.00, the annual premium would be $ 100.00.

Modern medicine and nutrition has increased the life expectancy of most people. Increased life expectancy has led to a sharp decline in life insurance premiums. In many cases, the cost of insurance are just a few cents per mile.

There is really only one type of life insurance that is a temporary insurance. This means that a person is assured for a certain period of time or a period. The rest of the products life insurance long term care insurance as the main ingredient. Any additional components which may be used. However, insurance companies have many, many other lifestyle products invented to conceal the reasons for life insurance tend. Also greatly enrich the insurance companies.

Term life insurance

Life insurance is a basic annual renewable policy. Each year the premium is slightly higher than the person ages. Insurance companies have developed a level premium policy, which stopped the annual premium increases for policyholders. Insurer essentially add up all the raw 0-100 years and then divided by 100th This means that in the early years of the policy, the insured person pays more money to finance the cost of pure insurance, and in the years after the premium is less than the cost of pure insurance.

Product level term itself can be designed for the conditions of length 5, 10, 20, 25 or 30 year term. The process of the average premium is equal.

But this new product has caused some problems. Insurers know that the vast majority of members do not have a policy for life. Therefore, the holders of long-term measures in the future and then terminate pay their policy premiums. The insurance companies were happy because they have kept the money. But over time, the concept of surrender value developed.

The cash surplus

Insurance with a cash value portion of the premium will not be credited to an account associated with your policy. The money is not yours ... This is the exclusive property of the insurance company. If you cancel your contract and request a refund, we will return the money to you. Otherwise, you have more options:

1 Use the value of money, buy more insurance
Two. Use the value of money to pay premiums on existing
Three. You can borrow money at interest
April. When you die, the insurance company keeps the cash value and pay only the face value of the insurance policy.

So make the cash value of the product make sense? My answer is "NO!"

Surrender value of life insurance, there are many other names, such as:

- Whole Life
- Universal Life
- Variable life
- Interest-sensitive life
- Life is not involved (excluding dividends)
- Participating Life (dividends)

Many insurance agents and companies trying to sell their products as an investment product. But the expression value for money is not an investment. Investment dollars and insurance premiums should not be combined in a single product. And more investment dollars should be invested in an insurance company. They are the intermediaries. You take your investment and invest and keep the difference.

Think about the methods being used by agents to sell life insurance, and compare them with any insurance any other kind What you see is what life insurance sales tactics and techniques are ridiculous compared to other insurance companies.

Would you consider buying a car insurance or insurance or insurance in which you have paid additional premium support from the insurance company, or you have to meet them? But curiously, have a life insurance agent was a great success, to convince intelligent people that the cash value of life insurance is to buy a good product.

Care to guess why insurance agent sells insurance cash value and aggressively prevents temporary insurance?
 

Commissions.

Insurance companies have become immensely rich insurance cash value. Thus, in order to promote sales, they pay huge commissions. Of long-term insurance costs can vary from 10% to 50%, sometimes even 100%. However, cash value insurance commissions of up to 100% of the premium for the first year and renewal commissions can be beautiful for years after.

But not only the commission that counts. Rewards also come into play term life insurance is much cheaper than cash value insurance.

Here is an example of a 30 year old man, Non smoking, buying $ 100,000 coverage:

Term life insurance is $ 0.50 per mile for a premium of 50.00 USD. A 100% commission, the commission would be $ 50.00.

Actuarial present value is $ 12.50 per thousand for a price of $ 1,250.00. A 100% commission, the commission would be $ 1,250.00.

So you see, it would be for an agent to place their own future financial well-being of its customers easy. It is 25 long-term policy for the same board to sell, that only a policy of monetary value.

But in my opinion, that the officer had violated his duty of loyalty to the client, it is the duty of placing the client's needs above you. The agent will also put aside their conscience.

My opinion is that life insurance agents to work from any of three positions:

1 Ignorance - they do not know how insurance cash value.
Two. Greed - know exactly how the cash value of the insurance and sell anyway.
Three. Knowledge and work - that care to sell.

What do you want to do the business agent?

How do I know? Because I was selling life insurance cash value at the beginning of my career.

When I started as an insurance agent in 1973, I knew absolutely nothing about how life works. The insurance company told me discourage sell life insurance and long term care insurance to customers. But after a while of reading and research, I learned that the insurance cash value is a bad thing. I started selling long-term care only. I refused to let go of my conscience. I went back to some customers and changed their original cash value of the policy over time.

The insurance company took me to this decision.

I found a new insurance, temporary and also pay high commissions to sell insurance. I made a good living from the sale of long-term care, so I know it can be done.

So how do you buy life insurance, please take the advice of a former agent. Never, never, never buy life insurance cash value. Buy a risk insurance.

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