Old Term Policies Can Be “Found Money” for Seniors and their Advisors

Any financial adviser or insurance agent who’s reading this post should stop what they’re doing right now, and start developing a plan to reach out to every person that they have ever sold a term policy. Dig into your files and find all your term clients, and quite honestly, the older the policyholder the better. What you are looking for is “found money.” One of the best financial opportunities available to many seniors right now is what we call a term-to-perm-to-life-settlement transaction. If you haven’t heard of this before, you will love it.

Identify a senior client who has a term policy and then explain to them that you have a financial offer that is unique to their demographic. Seniors with term policies are very likely to be sitting on a potential asset that is about to expire very soon. They are probably paying fairly low premiums and those payments might be on “autopilot” and are automatically being deducted from their bank account. Occasionally, they may think about the policy, and in the back of their mind, they may remember that this term policy is going to expire someday soon.

Agents who can identify clients in this position have the potential to be a hero while earning some exceptional commissions.

Here’s how it works:

First, identify a senior with a term policy.

Second, work with the client to convert the term policy to a form of permanent insurance, either whole life or universal life.

Third, arrange a life insurance settlement for your client.

It’s a win-win-win situation.

· Win No. 1: The advisor is the hero because a term policy that was going to soon be worthless has been converted into “found money.”

· Win No. 2: The agent or advisor can earn a commission on the term conversion for a policy that will now pay residuals until the client passes away.

· Win No. 3: The agent or advisor will earn a commission on the life settlement.

To make this happen, agents need two things: a client and a policy appraisal. Once you have identified the possible term-to-perm-to-life-settlement client, we can quickly analyze the situation and provide a policy appraisal for the life settlement transaction. With the appraisal in hand and a minimal financial outlay, a client can fairly quickly make a substantial gain. During the appraisal process, we will explain the nuances of performing this type of transaction.

Every client may not be a match for this opportunity, but for agents and advisors who have a large, and old, book of business, it will be well worth the effort to dig through those old term policies and uncover some “gold” for you and your clients. Give us a call or send us a text to learn more.

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