What You Need to Know
- Growth is great.
- Security is essential.
- Life insurance can help clients with growth, as well as with security.
For most of us — even those of us involved, in some fashion, with financial services — discussing life insurance ranks right up there with talking about bunion surgery or debating the merits of a high fiber diet.
In other words, it’s not that interesting, and there are a ton of things we’d rather be doing instead of wondering how much life insurance we need.
Yet, no product can do more than life insurance to bring your clients and their families peace of mind when it comes to protecting their financial future.
If you help clients with investments and retirement planning, but not with life insurance, you should consider teaming up with an agent or company that serves the advisor market, to ensure that clients are getting the help with life insurance that they need.
What Life Insurance Can Do
Having the right types of life insurance can help protect your clients’ income and assets while they are still working and after they’ve retired.
While some people understand life insurance as a “necessary expense” others overlook the valuable role insurance plays in creating financial security.
Even if a client has a substantial emergency fund, the client should still consider having adequate insurance in place to supplement those funds.
In addition, life insurance can help the client create an instant legacy for the client’s loved ones, provide money for final expenses and pay off the client’s mortgage and other bills.
Benefits for the Living
Some types of insurance, including specially designed whole life and other permanent insurance products, such as indexed universal life (IUL), provide what are known as “living benefits.”
When these policies are designed appropriately, they will give the client fantastic flexibility, use, and control of the client’s wealth and help the client create a predictable income stream.
An example of a living benefit is the cash value in a policy that may be used to purchase big-ticket items, such as automobiles, cash-flowing businesses, even homes.
Many Americans continue to subscribe to what is sometimes called BTID, or “buy term and invest the difference.” It’s a theory that says it’s better to buy term insurance instead of costlier permanent insurance like whole life or universal life.