Results
Life insurance provides the liquidity to execute a specific planning objective of protecting your success or minimizing the impact of your death. The results of our work will provide confidence to you that the important people in your life will be protected.
PREMIUM SAVINGS
Client objective: 70% premium savings
Policy design and insurance company selection can have a dramatic impact on the premium, as this case study demonstrates.
SITUATION:
Client profile:
Current policy:
Death benefit:
Premium:
Male, business owner, 54 years old
Guardian Life
$6,000,000
$121,339 … Business has cash flow problems
RESEARCH:
John Hancock
Met Life
American General
Lincoln Benefit
Transamerica
Principal
Prudential
Protective
RESULTS:
Updated premium:
Premium savings:
Premium reduction:
Death benefit:
$36,250
($85,089)
70%
$6 million—guaranteed
ANALYSIS
Why the difference? “Anaesthetized” marketing … Client liked the agent … very good company … no motivation for agent to produce alternative policy designs or pricing. The current company has no incentive to provide improved benefits.
Lifestyle changes net premium savings
Many clients assume that premium rates cannot be reduced after significant health issues are diagnosed. This recent case demonstrates how we were able to achieve dramatic premium savings.
SITUATION:
Client profile:
Previous health issues:
Male, 70, business owner
Prostate cancer – five years ago
Heart attack – six years ago
Sleep apnea
BACKGROUND:
Client’s existing policies issued five years ago with a large surcharge due to medical conditions.
- Client’s health and lifestyle improved markedly
- Medical advances and changes in carrier underwriting create renewed incentives to review existing policies
RESULT:
Our resources returned two top companies (Mass Mutual & Met Life) that combined to provide premium savings of over $117,000 annually and provided guaranteed premium and death benefit for $15 million of insurance.
ANALYSIS
Why the difference? Insurance companies constantly adjust their appetite for risk and by design evaluate risks differently. Our expertise and resources monitor these changes to provide clients with the best possible solutions available.
INCREASED DEATH BENEFIT
Northwestern Mutual vs. MetLife
Is the relationship with a “captive agent” worth $4.3 million?
SITUATION:
Client profile:
Current policy:
Death benefit:
Premium:
Married couple, ages 70 and 54
Northwestern Mutual
$2.8 million
$40,793
RESEARCH:
John Hancock
Transamerica
Lincoln Life
Prudential
AXA
Lincoln Benefit
MetLife
American General
Principal
RESULTS:
Death benefit increased $4.3 million, to $7.1 million, by replacing policy with MetLife. No change in premiums.
ANALYSIS
Why the difference? The client purchased seven policies from a “captive” agent whose loyalty was to the insurer, not the client. The new policy provides $4.3 million of additional insurance—tax-free—with no change in premium.
New York Life vs. MetLife
This case study shows how our knowledge of the insurance marketplace enabled us to significantly increase a client’s life benefit without increasing their premium.
SITUATION:
Client profile:
Policy:
Premium:
Death benefit:
Married couple, ages 61 and 62
New York Life
$47,771
$2.6 million
RESEARCH:
John Hancock
Transamerica
Lincoln Life
First Colony
AXA
Jefferson Pilot
MetLife
American General
Principal
RESULTS:
Premium before:
Premium after:
Death benefit before:
Death benefit after:
$47,771
$47,771
$2,600,000
$5,780,337 – 122% increase
ANALYSIS
Why the difference? Primarily product selection. The New York Life policy was designed to build up excess cash policy
values that were not consistent with the client’s needs.
COMPLEX MEDICAL RISK
Underwriting medical risk
The case study below provides a dramatic example of the differences between insurance companies when it comes to underwriting medical risks. Leveraging our knowledge of these differences, we were able to achieve significant premium savings for one of our clients.
SITUATION:
Client profile:
Death benefit:
Male, 66 years old
Open heart surgery history; prostate issues
Pilot
$5,000,000
RESEARCH:
John Hancock
Prudential
Transamerica
American General
Lincoln Financial
ING
Mass Mutual
RESULTS:
The same medical information was reviewed by all companies. The annual premium differential between the most expensive and the least expensive: $103,496
ANALYSIS
Why the difference? Our expertise in underwriting difficult medical risks and our knowledge of the insurance company marketplace enables us to identify the companies who will evaluate the risk correctly. We work for the client, NOT the companies.
Prostate cancer
This case study further highlights how insurance companies vary when it comes to underwriting medical risks. Our knowledge of these differences enables us to deliver maximum premium savings for our clients.
SITUATION:
Client profile:
Death benefit:
Male,70 years old
Prostate cancer (currently); skin cancer (2000)
$1,000,000
RESEARCH:
John Hancock
Protective
MetLife
American General
Mass Mutual
Transamerica
ING
Prudential
Lincoln Financial
Lincoln Benefit
RESULTS:
Met Life issued the policy with standard medical rates. Five other companies declined coverage because the client is currently being treated for prostate cancer.
ANALYSIS
Why the difference? Additional testing by Met Life indicated that the prostate cancer was progressing very slowly and therefore would not impact his mortality.
Our expertise in underwriting difficult medical risks and our knowledge of the insurance company marketplace enables us to identify the companies who will evaluate the risk correctly. We work for the client, NOT the companies.
Profile: Client with medical issues
At the end of the year Insurance companies are looking for top line growth and consequently become “creative” in evaluating medical risks. That creates opportunities for clients with above-average risk factors.
For example, we worked with a client with the following profile:
- Male, age 71
- Heart attack within the last six years
- Prostate cancer
- Private pilot
Nonetheless, we were able to secure a policy with Preferred Medical Rates.
How is this possible? When insurance companies develop products, certain mortality assumptions are built into the pricing. In fact, the mortality levels are better than many of these companies have projected, which gives them added capacity to assume risks they would not normally consider.
This window of opportunity closes at the end of each year, so it’s important to allow time for us to gather the necessary information and to negotiate for the best possible rate.