New Year, New Options for Term Conversions, Policy Review & Supplemental Perm Coverage

With the new year, many advisors are thinking about ways to work more efficiently and increase their business. Annual client policy reviews are a great practice to evaluate and update your clients’ financial plans and also to further nurture your client relationships. Whether performed at the end of the year or at the beginning, policy reviews are well worth the time spent. They get you “in front” of your clients, help to increase client trust in you, and may potentially mean more business for your practice. 

This ONE Idea provides carrier product information to use during policy reviews – or at any time – with your clients who have term policies and might be interested in converting to permanent OR supplementing their existing term policies with a permanent policy as well.

Depending on certain qualifications and state availability, your clients with term policies may be able to qualify for one of two carrier programs. Please note that each carrier has specific requirements, so it is important to familiarize yourself with qualifications and state availability. AgencyONE can provide you with this information.

Term Conversion Option – Term to Perm

Carrier partner A offers a program for a term conversion to a permanent product only. Policyowners who have purchased a fully underwritten single life term insurance policy from a select group of carriers within the last five years may be eligible to convert that external term policy to a permanent Carrier A life insurance policy. Available conversion solutions include Accumulation, Protection, and Current Assumption UL products. The minimum face amount is $100,000 and the maximum face amount is $1,000,000. Following are Carrier A’s current underwriting guidelines for their program:

• Minimum age for new policy is insured age 18
• Maximum issue age for new policy is insured age 65
• New policy is limited to the Level Death Benefit option
• Underwriting of the original term policy must have occurred within the last five years based on the issue date and the risk must be classified as standard or better
• New policy will be issued at either a preferred or standard rate class
• Nicotine status for the new policy will be the same nicotine status as the original policy 

Your AgencyONE case designer is available to discuss this program along with Carrier A’s list of eligibility requirements and accepted carriers. We are also happy to provide sample conversion illustrations if needed.

Supplemental Perm with Existing Term Option – NEW Permanent Coverage with ZERO Underwriting Required

Carrier partner B’s program offers clients, who have existing term life insurance policies with other carriers the opportunity to purchase a permanent life insurance policy from Carrier B without the requirement of additional underwriting! (Subject to a list of Term policy stipulations and underwriting and policy issue requirements). Carrier B’s program was designed to offer additional, rather than replacement, coverage. If a replacement becomes part of the transaction, normal replacement rules apply.

Additional Carrier B program benefits include:

• A streamlined life insurance buying process
• A client with an eligible term policy issued in the last 3 years can buy a new permanent life insurance policy from Carrier B with no additional underwriting requirements
• Policy face amounts up to $5 million

                  Ages 18 to 50 – $100,000 to $5 million face amount

               Ages 51 to 60 – $100,000 to $1 million face amount (equal to or less than the existing policy down to $100,000)

• Option to add cash indemnity Long-Term Care Rider

                 Simply complete the Long-Term Care Supplement Form, no receipts required once a claim has been established

• Clients can choose to keep their existing term life coverage in place 
• Policyholders can get a separate permanent policy and are not required to replace their term life insurance for permanent coverage 

This program also has quite a few policy qualifications and requirements. Please contact a member of your AgencyONE case design team for more specifics about this program.

AgencyONE’s Case Design Department is pleased to continue to provide our AgencyONE 100 Advisors with carrier solutions and product intelligence that addresses their client’s current and changing financial and insurance needs throughout the year.

Please contact the AgencyONE Case Design Department at 301.803.7500 for more information or to discuss a case.