Term Life Insurance is generally purchased to replace the income of the bread winner of the family and to provide sufficient financial liquidity for the family to satisfy any outstanding debt, such as a mortgage or medical bills.
These days, many clients are looking for ways to save money, and are cutting back on luxuries as well as many day-to-day necessities.
There is a way to keep clients covered, while at the same time saving them some premium dollars – and generating some commission dollars for you.
The Income Protection Option (IPO) is a product feature designed to help you meet the financial needs of your clients, with premiums 20-25% lower than traditional Term Life Insurance.
By merely restructuring how the clients’ death benefits will be paid out, the policies can provide a guaranteed annual income stream to the surviving heirs for as many as 30 years, or as few as five.
- A case was placed in April 2012
- The 20 year, $2.5 million term policy was issued at a standard risk class, with a monthly premium of $577.00 for a male age 47
- Now the client is age 48
- I designed a new policy that includes the Income Protection Option – which will pay $500,000 upon his death, and provide a $100,000 annual payment to the family for 20 years – same total payout of $2.5 million
- The new monthly premium is $476.73 – the client now has a new 20 year term policy costing $100 less every month – lowering the Life Insurance cost by 20%
Income Protection Option will not fit in all sales scenarios; however, we encourage you to review the term cases you have written over the past few years. Reach out to your clients – ask if the extended death benefit payout would work for them.
Contact us today for more information.