Question: Third quarter reports are not all rosy, especially for carriers offering life and annuity products with living benefit guarantees. How should advisors approach sales in the fourth quarter?
“I’m telling my agents that there are several universal life carriers that have not moved yet to reprice their products for the guarantees. So they should pick carriers that will accept business at this year’s prices by year end. There are three carriers that I know that are saying agents should send them any business with guarantees this year. They should do that because this is the agent’s last chance to get pre-AG 38 rates. As for agents who are discouraged by the news about losses at some of the carriers and the resulting announcements about repricing or scaling-back, it helps to remember that this is the adjustment we’ve been expecting.”
– Doug Jewitt, Director of Marketing, Insurance Designers of America, Woodstock, Ga.
“The agents should think of this period as a fire sale on no-lapse guarantees for universal life. Prices will never be as good again as they are now for life insurance. Once all carriers have repriced their products, agents should try selling other products. For instance, sell combo policies—universal life with long-term care riders. Sales on those products are already up, up, up—at my firm and also for the industry. Part of the reason for that is carriers in the standalone long-term care insurance business have been leaving the market, but consumers still need long-term care protection. Another reason is the perception that standalone long-term care insurance is expensive. By comparison, with the combo policies, people get something back for their money, so they are buying. I also tell agents to stay the course. Life insurance will still be needed; it won’t go away because of low interest rates and some discouraging third quarter reports.”
-- Michael Smith, President, The Brokerage Inc., Lewisville, Texas
“The agents need to go to work. The markets will do what the markets will do, and the products will do what the products will do, regardless of what quarter it is. If the client has a need, go and find a product. Our job as brokerage general agents is to keep the agents apprised of the changes that are coming out. No agent can keep up with all the changes and products that are out there, and also sell, so when agents come to us with a problem or a need, it’s our job to find a solution.”
– Sam Corey, Vice President-Sales, The Brokerage Resource, Durham, NC