Is it any wonder why the American public does not trust life insurance agents?
A couple of weeks ago I went out and wrote life insurance policies for a couple of my clients. I was called up by a gentlemen who was on a group term life insurance plan through his former employer. It started going crazy. It was obviously going into what I call its death spiral. It was acting like a five year renewable term. The price was going up and the face amount was going down every five years. When we called, they did indeed confirm that the actual policy, itself, was going to expire in the not too distant future.
This guy needed the coverage, wanted the coverage. We needed to fix it. Thankfully, they still were insurable, and I was able to secure for them an immediate death benefit through a whole life plan for both of them. His wife had had an amputation due to diabetes several years before, so it was a little dicey, but I did finally get it done with an A rated carrier. Got it in place, everything was great. Got them off of a five year renewable term, completely inappropriate, going away, got them into whole life, level premiums, level death benefit, no more moving parts. End of story, I thought.
A week later, got a call. The guy said, “Hey, you know what? I was referred by my company to this guy who’s got me this $50,000 policy for $207.25. I said, “Are you looking at AARP?” He goes, “Yes.” I said, “Sir, do you realize that that is a five year renewable term? It is exactly what I just took you off of that was going away.”
He said, “How do you know that?” I said, “Because I’ve got their brochure on my desk. You’re premium is $207.25, isn’t it?” He says, “Yeah, it is.” I said, “Why are you doing that?” He goes, “Well, $50,000 for less money sounded good.” I was like, “Sir, it’s a term plan.” He goes, “But I can convert anytime up to age 80, and the man told me,”….isn’t that great, “the man told me…” “The man told me that $207 would be level until age 80.”
I have no idea if that was what was said, but that’s the impression he came away with. I said, “That’s wrong. What else did he tell you?” He said, “He told me that I could convert at anytime up to age 80.” I said, “That’s correct.”
“And he said that I could get the same price that you’re giving me right now for $50,000.” I said, “False. I can prove that.” I hung up the phone with him and I called AARP, and I got their operator on the phone and confirmed that after one year his $207.25 was going to go to $366.92. My plan’s price was $320 for a whole life, permanent forever. His plan was going from $207 to $366. That was met with silence on the phone. Then I also got a quote today for what his whole life would cost if he went…it was four and a quarter. Yeah, four and a quarter, something like that. No, it was $456. I said, “At age 80, what’s the estimate now?” They go, “Our estimate is $512.” I said, “We’ll that ain’t $320.”
I called the guy back, and long story short, folks, this agent had completely misrepresented this policy, could not have communicated worse about it because everything this guy repeated to me was wrong. The agent could not have asked any questions about where he had come from, because I had just taken him off of something at their request that was blowing up and going away. The agent comes in and screws up everything that I had done and puts him right back into a five year renewable term again.
It is no wonder people don’t trust life insurance agents, when business is conducted like that. Now, I sound like I’m annoyed. I am annoyed. Thankfully, this has got a happy ending. I had to spend two days on it, to go over there and figure this out, sit down with this guy and explain to him what he was doing, and we got it straightened out. But guys, we have got to do business better than that. Families are counting on us being professional, knowing what our products do and how they work, and being able to explain exactly the way that they work, and having the integrity to actually put people in something that’s going to be for their benefit, and not just for your commission check.