Key Takeaways
- 80% of clients are best served by term life—don't overcomplicate it
- Clients who understand why they chose their product have 60% higher retention
- The "buy term and invest the difference" debate has no universal winner—it depends on client behavior
Finding the Right Fit
Client Question: "Which type of life insurance is actually best?"
There's no universally "best" product—only best fit for your situation. Here's how they compare:
| Client Need | Term | Whole Life | IUL |
|---|---|---|---|
| Maximum coverage, tight budget | Best | Poor | Poor |
| Temporary need (mortgage, kids) | Best | Okay | Okay |
| Lifetime coverage guaranteed | Poor | Best | Good |
| Cash value growth potential | None | Guaranteed | Variable |
| Flexibility in premiums | None | None | Best |
| Simplicity | Best | Good | Poor |
Guiding Questions
- "Do you need coverage for a specific time period or for your whole life?"
- "Is building cash value important to you, or is pure protection enough?"
- "How comfortable are you with complex financial products?"
- "What's your budget for premiums?"
Term vs. Whole Life Decision
A client torn between term and whole life
Setup
A 38-year-old isn't sure whether to get term or whole life. They can afford either, but want to make the right choice. They have two kids and a mortgage.
Client says:
“I keep going back and forth. Term seems smart because it's cheaper and I probably don't need coverage forever. But whole life feels safer somehow—like I'm building something. Which one should I get?”
Practice Objectives
- 1Explore what "building something" means to them
- 2Discuss how long they actually need coverage
- 3Compare what they'd get from each option
- 4Consider buy term and invest the difference
- 5Help them make a confident decision
When to Add IUL
A client with term asking if they should also get IUL
Setup
A client already has adequate term coverage. They've heard about IUL and are wondering if they should add it to their portfolio. They max out their 401k.
Client says:
“I have a $1 million 20-year term policy that covers my family's needs. But I keep hearing about IUL for building wealth. Should I add an IUL policy on top of what I have? I max out my 401k already.”
Practice Objectives
- 1Clarify what problem they're trying to solve
- 2Confirm they've maxed traditional options
- 3Discuss whether additional coverage is needed
- 4Explain IUL as a wealth-building tool, not just insurance
- 5Help them decide if it adds value to their situation
Converting Term to Permanent
A client whose term is expiring and considering conversion
Setup
A client bought a 20-year term at 35. Now they're 54, the term is almost up, and they're considering converting to whole life. Their health has declined.
Client says:
“My term policy is ending next year. When I bought it, I thought I wouldn't need coverage at 55. But my health isn't great now—I had a heart issue last year. I'm worried I can't get new coverage. What are my options?”
Practice Objectives
- 1Explain how the conversion privilege works
- 2Discuss that no medical exam is required for conversion
- 3Be honest about the cost difference at their age
- 4Explore whether they still need coverage and how much
- 5Help them weigh options carefully
A client asks "Which is better—whole life or IUL?" The best response is: