Life insurance can seem complicated. And sometimes it truly is.
My mission is to bring you little bits of helpful information to make life insurance sales simple.
Here’s the scenario: Your client is meeting with you to purchase a Medicare Supplement.
During the appointment, you’ll ask a simple question that can double your sales:
“Do you have your final expenses covered?”
Most individuals don’t realize the cost of funerals these days, so you get to take a moment to educate them that the average cost of a basic funeral is around $10,000.
From here, your biggest fear might be that they’ll say “yes.”
- What now?
- What’s the underwriting like?
- What’s the price of this going to be?
- Am I in over my head?
I’m going to make things easy. There are 3 types of life insurance that are perfect here if your client says “yes.” (Premium examples are included at the end of this article.)
- Basic final expense
- Participating whole life
- Single premium whole life
All three applications are simple:
- The application is almost identical to a Med Supp app.
- There are no exams for face amounts less than $20,000. (Most policies fall in this range.)
- The Med Supp-esque application and the phone interview take care of the underwriting.
This makes your life incredibly easy. You can keep doing what you’re doing – selling Med Supps like a champ – while expanding your briefcase to include this final expense option.
Let’s compare the three final expense options from a high-level view:
| Payment method | Benefit amount | Cash value | |
|---|---|---|---|
| Basic Final Expense | Monthly, Quarterly, Semi-Annually, or Annually | Stays the same | Builds up slowly |
| Participating Whole Life | Monthly, Quarterly, Semi-Annually, or Annually | Increases a little over time | Builds up moderately |
| Single Premium Whole Life | Lump sum upfront | Increases the most over time | Builds up quickly |
To give you an idea of the costs your client might pay for each type of insurance, here are some examples for a male and a female.
Male, Issue Age 65, Non-Tobacco, 10k policy
| Payment method | Initial Death Benefit | Death benefit over time | |
|---|---|---|---|
| Basic Final Expense | $44.82/mo | $10k | Stays the same |
| Participating Whole Life | $42.34/mo | $10k | Increases each year |
| Single Premium Whole Life | $10k upfront | $17,228 | Increases each year |
Female, Issue Age 65, Non-Tobacco, 10k policy
| Payment method | Initial Death Benefit | Death benefit over time | |
|---|---|---|---|
| Basic Final Expense | $37.32/mo | $10k | Stays the same |
| Participating Whole Life | $35.42/mo | $10k | Increases each year |
| Single Premium Whole Life | $10k upfront | $18,919 | Increases each year |
Want some coaching to get started? Email Kirk Sarff, the head of the Life Department for more information.
