My Client doesn't want to pay the Conversion premium
Case Study- Term Conversion Settlement: Client was a 67 year old male who owned a 2.5m Prudential Term policy nearing the end of its guaranteed premium and conversion period. Policy was originally taken out in a buy sell agreement and the client had recently retired from the business so full coverage was no longer needed. Insured did however want to keep some coverage on himself to cover loved ones but could not afford the much higher conversion premiums for the 2.5m policy. Over the years the insured had acquired several progressive health ailments which took him from a standard rating at issue to uninsurable with several new carriers the agent had gone to for new insurance. So new insurance was not an option.
The Solution: The agent recommended the client convert 1.5m of the 2.5m Term policy and look into selling the remaining 1m coverage in a life settlement transaction to help fund future ongoing premiums for the converted policy. This option is a great way to obtain some salvage value for a policy that would otherwise terminate without value.
After properly shopping the case and using our exclusive relationships with our buyers who particularly like Term conversion scenarios we were able to secure a gross offer of $116,000 for the sale of the policy. If the agent had let the 1M portion of the policy lapse the client would have made zero dollars and the agent would have made zero dollars on that portion. A life settlement will always be a better option. LIS paid the agent a compensation on the case AND the agent received his conversion compensation on the entire 2.5m policy. 2 commissions out of one policy sale.
Let your senior clients know they have a much better option than surrender or lapse, it's having the policy appraised and sold We want to see your clients case about 6 months prior to the conversion to give us plenty of time to go through the process. Let's work together to help as many seniors as we can this year.
If you have a similar situation please contact me:
Daxton Fryer 866-326-5433 [email protected]