Life Insurance Checkup: An Important Tool for Financial Health

There's no better time than during Life Insurance Awareness Month to conduct a "life insurance checkup"

As you know, Life Insurance Awareness Month makes sure Americans are reminded of the need to include life insurance in their financial plans. Each September, LIFE is joined in this educational initiative by more than 100 of the nation's leading insurance companies and industry groups. In fact, many prospects who don't have a dedicated life insurance professional watching out for them have never had a life insurance checkup. That means that their life insurance coverage may not be up-to-date and may not be working in the most efficient way possible to meet their needs. This valuable service is key to providing your clients with the best use of their life insurance premium dollars and cash values.

What questions does a life insurance checkup answer?

This service, we can provide this valuable resource to you and your family, you may not have looked at your life insurance policies for years. This is a "non-threatening" analysis, especially if it can show you ways to save money or gain better coverage for the same premium outlay.

Some key questions and activities that you should be prepared for when conducting a checkup include for our clients:

o Reviewing the clients' and prospects' current personal financial situation. Children, retirement, college education, aging parents, estate planning, jobs, and careers are all elements that should be discussed. What's happening in their lives? What's changed since they purchased the policy?

o How strong is the insurance company that is backing the policies?

o How is the policy titled? Who owns the policy? Who are the beneficiaries? Should any changes be made?

o What was the original need that the life insurance was intended to meet?

o Does the client have the right type of insurance? What type does the client currently have: variable, universal, whole or term life insurance?

o Does the client have the appropriate amount of insurance related to other assets, liabilities, family circumstances, pre-retirement death benefits, Social Security survivor benefits or inheritance?

o Is the client overpaying? It's important to evaluate current policies and run current illustrations to see if the policy is performing as it was originally designed to do.

o If the person has term policies, it's imperative to check on the policy's competitiveness in light of the person's current health. Does the term time frame match the timing of key liabilities such as mortgage payoff?

o Calculate the true internal rate of return on cash value policies and compare them to alternatives in the market place which may include a better policy, paying down debt, or putting a Roth IRA in place.

o What other insurance or financial needs can be identified through this life insurance checkup analysis? Are there opportunities to cross-sell important products to meet other needs?


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