Workable Business Opportunity?

Variable Universal Life Insurance Policies (VUL) makes up over 20 percent of the Life Insurance Market. There are so many negatives to VULs. 1) Charges a ridiculously high fee every month. 2) Carries a huge surrender charge if you can't afford to maintain the policy or decides to exit the policy. 3) Average performance of about 8 percent a year. I find it is so much better to buy term life insurance for a one time fee and investing that difference somewhere else. Would you think it's great if we can convince ppl with VUL to exit their policy and switch to buying term life insurance and have us manage the money leftover? Would that be a great way to find clients or investors?

Workable Business Opportunity?
I wouldn't target people with VUL's. If they don't want to do their research and make their own decisions, next year someone else is going to switch them back.





I prefer thinking customers.
Reply:What you intend to do is twisting and it is strictly prohibited unless you fully undertand the pro and cons and not just the commissions.





Most insurance products have their pros and cons. Term Life is cheaper and you may be thinking u can help them to manage their money better, but in reality to accumulate money it require more than ROI and Investment skill. The client need something called "HABIT". Insurance products are designed to help client to buid the saving habit as well. Eventhough the return is not that fantastic but they are able to save a little at a time plus the protection.





I will strongly suggest that u should not twist the policy and just invest their additional money with you








loihl@einsuran.com
Reply:Twisting? Twisting? If you show the client how their policy works, what the problems are, THEN turn around, replace the VUL with term and invest the difference there is no twisting involved. NONE!!! But you MUST explain VUL to the client. Once they see how it works, they will be happy to change.





VUL is bad insurance. Rate of return does not come close to what agents tell people. Furthermore, some still tell them that it is an investment. This is wrong, also illegal. As the first answerer stated do not focus your time and energy here. Focus on developing a client base. As you work that way, you will come across these policies.





When you hear the claims of twisting, it is someone in a major insurance company who sells this stuff. VUL is the Insurance industry's answer to A.L. Williams/Primerica for buying term and investing the difference. Unfortunately, this insurance still, in most cases, is not the best for the client. If you Always work in the client's best interest there is nothing the industry can say to you or do to you to stop you. That was proved from the beginning, and still, with A.L. Williams/Primerica. We want the agents to keep writing this stuff so we can come through and fix that mess up.
Reply:I want to add a 4th negative to you comment. In most cases if you die your family doesn't receive your savings (depends on if your policy has that option, which costs more if you do).





I am with Primerica, and that is what are company has been doing for 30 years now. Our goal is to completely eliminate all types of these policies. Buy term and invest the difference will ALWAYS prove to be a better strategy as long as you invest the difference.





The "forced discipline" can be solved by setting up an automatic draft from you checking account.
Reply:It's an overly-simplified approach. What if they want the protection for the rest of their life and they have a guarantee rider on their policy? Or what if they plan on borrowing from the policy with a wash loan and they have the overloan protection feature and the additional internal risks of the policy are suitable especially given their high tax bracket?





I don't think term would be a justifiable replacement in these cases.





Mark, I would chill out with the absolute statements. Didn't you just start with Primerica 2 months ago? Just because you went to a training camp or whatever doesn't mean you know everything. You know I'm not a big VUL fan, but it has its time and place.

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