Why Your Age Makes A Difference When Buying Life Insurance

Life Insurance premiums are based on two major factors: your age and health.

All other factors being equal, the younger you are, the cheaper your life insurance policy will be.

Therefore, if you don’t already have life insurance, the most affordable time to buy it is right now! Every day you age, you’re drawing closer and closer to higher premiums. Ironically, the youngest adults seem to think they don’t need it until far down the road, while older buyers wish they would have locked in their rates a long time ago.

Insurance Age: What Is It?

If you are going to shop for life insurance, you should know what your insurance age is to make sure you are comparing apples to apples.

For example, if you are currently 40 years old, but you turn 41 next week, you may be thinking you have one week left until your rates go up. Unfortunately, there’s a good chance you are too late.

Your insurance age, when discussing life insurance, is typically whichever age you are closest to! So if you are 40 years and 6 months old, you’re actually now closer to your 41st birthday, so the insurance company is going to view you as 41. (Not all companies do this, but most.)

This is because the law of large numbers insurance companies use to draft their premium tables involves grouping each person into a single age group. For their statistics to be most accurate, they have to categorize you into the age you are closest to.

The Younger You Are, The Better Your Rate

As we mentioned, your life insurance is largely based on your age when calculating your cost to own the policy.

Term life insurance is especially age sensitive when determining rates. This is because it is covering you over a very specific time period; the closer your life insurance period expires to your life expectancy, the more it will cost you.

• If you’re a young adult, the increase in premiums is small each year.
• If you’re middle aged, the increase in premiums starts moving faster.
• If you are a senior citizen, expect your rates to go up very fast every year you age.

Because your natural life expectancy is so far away, you are considered lower risk when you’re young. As you near it, you are considered a greater risk to the insurance company of having to pay a claim. As your risk goes up, guess what else does? Premiums.

How Your Age Affects The Amount Of Coverage You Need

Your life insurance coverage amount you decide on is somewhat tied to your age as well.

The idea behind life insurance is to replace income after you pass, or to pay off any debts your family might incur or already have to deal with.

If you are 25 years of age, and expecting to work until you are 65 years old, your family would miss out on 40 years of your income if you passed away now. If you are 45 and you expect to work until 65, your family would miss out on 20 years of income.

Your human capital, or the value of your future work, is highest when you are young. As you age, and your remaining work years diminish, the idea is while your human capital is declining; your assets should be increasing. Eventually, the hope is to retire, and your income is coming solely from the assets you’re accumulated, and not from you going to work.

What does this mean for your life insurance coverage amount?

If you are young, and you expect to be working a few decades, you may want to stock up on your life insurance now, especially since the premiums are going to be so low.

If you are already in your 40′s and 50′s, you may need less of a face amount because:

1. Your human capital is declining, lowering your replacement cost
2. Your debts should be declining, dropping your coverage needs
3. Your premiums are increasing with your age, making life insurance less affordable

Other Costs Associated With Life Insurance As You Get Older

There are other costs involved with owning a life insurance policy as you age. One of those things are called riders.

Let’s take the Waiver of Premium rider, for example, which is one of the most common riders to attach to a life insurance policy.

The waiver of premium rider is something you can attach to your policy for a small fee which protects your policy should you become disabled. If you are disabled for 6 months or longer, the rider will kick in and start to pay your premiums for you. In this way, even if you lose your income because you’re not able to work, you’ll still have a life insurance policy which won’t lapse.

Your age, however, also determines the cost of the waiver of premium rider. If you are a young 25 year old, your body is expected to last much longer without any disabling injuries, whereas a 55 year old is much more likely to incur a disability.

Nine of Ten Moms will say NO!!!

Nine out of ten moms will say NO...which is exactly what you want them to say!   With Fall Life and the unofficial start of the Year-End Crunch upon us, Agents and Team Members are scrambling to meet with policyholders and prospects in order to achieve production goals and promote the 'Life Happens' theme. Instead of looking here, there and everywhere, might I suggest you narrow your focus down to moms!   Together with your team, create a list of all the moms you know. Moms you insure. Moms you know but do not insure. Moms from your family. Moms from your neighborhood. Moms of your children's friends. Include them all.    Once you have your list, further qualify your list into three categories of Moms. Category #1 includes "stay-at-home moms." Category # 2 includes "dual-income moms" and category #3 includes "single moms."   Start with category # 1 (stay-at-home moms) and ask them the following question:   "If your husband's last paycheck was in fact his last paycheck (PAUSE), would your children be okay?"   Nine out of ten moms will say NO!   When nine out of ten moms say NO, respond with a one word question....WHY?   Mom will then tell you why Life Insurance (or Disability Income Insurance) would be a good idea for her family! (Note: Mom will probably respond to WHY? by saying "we rely on my husband’s income," or, "I would have to go to work.")   Now work on category # 2 (dual-income moms) and ask them the very same question. Well almost.   "If yours, or your husband's, last paycheck was in fact your (his) last paycheck (PAUSE), would your children be okay?"   Nine out of ten moms will say NO!   When nine out of ten moms say NO, respond with a one word question....WHY?   Mom will then tell you why Life Insurance (or Disability Income Insurance) would be a good idea for her family! (Her answer will include something along the lines of "we rely on both incomes, etc.")   With Category # 3 (single moms) it's the same question (almost) with the same result:   "If your last paycheck was in fact your last paycheck (PAUSE), would your children be okay?   Nine out of ten moms will say NO, followed by your response of...WHY?...followed by the single mom telling you why Life Insurance (or Disability Income Insurance) would be a good idea for her family! (Her answer will include something along the lines of "I don't have anyone to take care of my kids, etc.")   Time is ticking on another year. Fall Life is up and running and year end is right around the corner. Get together as a team today and start creating a list of moms...all of the moms you know and start making calls today!   When you ask moms about their last paycheck being their last paycheck, nine out of ten will say NO their kids will NOT be okay. When you ask them why, they WILL tell you why Life Insurance (or Disability Insurance) is a good idea for their family!   For more ideas on generating Life Insurance applications for your book of business (BOB), schedule a LIFE REVIEW with Doug Myrick, YOUR 2020 COACH, today!   One Degree Is All It Takes

2014 countdown to the New Year

It’s already started… As soon as September rolls around, all the Team Leaders and VPs feel compelled to remind us that it's Fourth Quarter, the year’s almost over, only 120 days to reach your 2013 goals, yada, yada, yada… 

I think it must be a secret, unwritten rule that we all have to remind each other what everyone already knows: Time marches on and, yes, this year is racing to a close.  

And while you may get sick of hearing all the “120 days til 2014” emails, the thing is, they’re right!  2013 is flying by, and with it, perhaps your hopes to accomplish some big things in your business.  

So if you feel like you’re running out of time and you still want to hit your goals and be PROUD when you look back on the year, the absolute best and quickest way to have an impact is by asking for referrals and cross-selling to your existing clients.

Here are the results of a survey of 'Top Producers,' who consistently earn $100,000 or more each year:
1.       Referrals from clients, and non-clients (and joint ventures) ....... 94.3%
2.       Contacting clients by phone, or in person (annual reviews)........ 73.9%
3.       Printed newsletter, mailed, or hand-delivered.......................  47.3%
4.       Seminars, educational workshops, teaching classes.................. 43.3%
5.       Participation in organizations of clients (church, scouts).........   38.0%
6.       Speeches, talks to civic, trade, select groups........................ 31.0%
7.       Electronic newsletter, faxed, e-mailed, etc........................... 29.8%
8.       Website focusing on you, and your business......................... 27.8%
9.       Writing articles for newspapers, magazines.........................  27.8%
10.   Professional public relations (hire a media consultant) ............  22.9%
11.   Cold e-mailing, faxing, mailing brochures, etc.....................   21.6%
12.   Cold calling, by phone, or in person....................................18.4%
13.   Directory listings..............................................................18.4%
14.   Working with the media.....................................................18.4%
15.   Advertising in newspapers, magazines................................. 14.7%

Bottom line:  It’s September, do you know where you are on your 2013 goals?  Get help and get going using one or more of the options above.  The clock is counting down…

To your success,

FREE Labor This Weekend!

Car manufacturers and car dealers are all gearing up for the big Holiday Weekend.  It's the end of the model year and new models are hitting showroom floors and local car dealers across the country.     Offers for manufacturers rebates, dealer incentives, zero percent financing and other "creative" marketing incentives litter your local newspaper, TV and radio airwaves as well as Internet sites.   Car companies and their dealers are all looking to gain an advantage on their competition this weekend because they know the Labor Day Weekend is traditionally one of their biggest weekends of the year.    Stop by any car dealer this weekend and you are likely to see a flurry of activity.  With all of the activity, I have to wonder what you the local insurance agent/agency are doing to gear up for the Holiday Weekend and all of the activity.    Your current customers could be adding vehicles this weekend.  They might also be trading in an older car for a new model.   Do these customers of yours know they can call your Agency this weekend to add the vehicle or provide information on their trade-in, or will some wait until Tuesday morning to report their new purchase to you.    How about those people from your market area that are NOT currently insured with you.  When they buy a new car this weekend, who will the car dealer call to secure coverage or confirm coverage?    For most of you, the answer to that question is....someone else!    I know because my sister recently purchased a car over a weekend and told her car salesperson she had State Farm.  He responded by saying he would have to wait until Monday to verify coverage because her company " was not open on the weekend."     Allstate, Farmers, and State Farm Agents....the world thinks you are closed on the weekend.  While you and I know you have after hours service to provide customer service and quote and bind coverage...the general public still thinks of you as being closed after hours and over weekends.   Don't believe me?  Take a look at your call statistics.  What percentage of incoming calls to your Agency are placed between 9:00 a.m. and 5:00 p.m. as compared to the percentage of calls placed between 5:00 p.m. and 9:00 a.m. It is not even close....your customers are calling during "normal business hours."    Car Dealers also think you are closed after 5:00 p.m. and on weekends.  This is unfortunate considering most cars are purchased after 5:00 p.m. and on weekends.   Especially on Holiday Weekends such as the upcoming Labor Day Weekend.    Here's something you can do to change that thinking.   This Thursday and Friday night, buy a pizza and hand deliver it to your local car dealer(s).  On the box top (inside or out) tape a simple flyer reminding dealers that you are open and available to quote and bind coverage this holiday weekend.   Tape some business cards to the outside of the box as well.      Don't be shy about this activity.  Consider delivering a pizza to every car dealer in your community.  Heck, why not deliver a pizza to every car dealer in your county.    I can bet you this....the other insurance agents in your community and county won't think of this idea.    So here we go.  Another Labor Day weekend quickly approaching.  Some of you will close at 5:00 p.m. and some of you already scheduled the entire weekend as vacation or might even close earlier for the "holiday."  Some of you will come to work on Tuesday and be surprised to see one quote and bind from the weekend.   Others wouldn't be surprised if they did not receive any quote and bind notices from the weekend, OR...    ...you can proactively visit car dealers before the weekend (and for lunch on Saturday) to remind them that you are OPEN this weekend and AVAILABLE to quote and bind coverage for their customers.     When local car dealers call you after 5:00 p.m. and on weekends to quote and bind coverage...it's like receiving FREE LABOR this holiday weekend.   Even if you do not receive any quote and binds from this coverage, this simple activity will keep your name and your Agency in front of car dealers in your community....and that's always a good thing!

Fall Life & Year-End - The early bird gets the PRIZE!

Agents and Team Members across our organization are gearing up for Fall Life with the hopes of qualifying for neat incentives or to jump start Life Production with the hopes of finishing the year strong.     For those who are "gearing up," why wait?  For those of you who are "hoping" to qualify for neat incentives or to jump start production for year end, why hope?     NOW is the time to start setting appointments for the Fall Life Promotion and for year-end.   The agent or team member who starts NOW is more likely to qualify then the Agent or Team Member who waits for September 1st to roll around.  Let's not even talk about the agent who waits until November and December  :0 Yeah, you may qualify, but do you really want the stress that comes along with it.    If you are serious about the Fall Life Campaign and about finishing the Life year STRONG....you are welcome to schedule a Life Review Coaching Call with me at your leisure.  With thirty years of experience, I will be happy to share BEST PRACTICES with you for selling Life Insurance.  I have easily transferable action plans that will enable you to immediately start selling Life Insurance to: People who already have Life Insurance; Old People; Young People; Mom's; and Homeowner's I can even show you how to sell Life Insurance to people:  who "have it at work"; don't have any money; don't have time to meet with you; and those who have been told by Dave Ramsey that Whole Life Insurance s%$#*! To schedule a "Life Review" to get Life Insurance jump started for your book of business (BOB), or for some extra training for existing Team Members, please contact me today because as the saying goes...the early bird gets the worm!  Click Here to Schedule a Life Review Session

How To Send Your Direct Mail Marketing Campaign For FREE!

This is a marketing idea that I refer to as the “Group Direct Mail Marketing Campaign.”

We all know direct mail can work if it’s sent to the right target demographic (your buying public), and if it’s done consistently. And, every business owner would love to send their direct mail campaigns for free, but that’s impossible, right? Wrong!

Here’s how: You approach 9 other vendors, businesses, companies, corporations, professionals, etc., and see if they’d like to be involved in a group direct mail marketing campaign. The perks of working with you is that you are going to take care of everything – the printing, the entire direct mail effort, etc., and it is much cheaper than a traditional direct mail effort because the cost of the effort is divided amongst the group of 9 business owners. (More on this in a minute as your direct mail piece will not cost you anything.)

This is similar to a value pak envelope if you are familiar with Value Pak. However, your envelope is bigger (usually 2-sided, 8.5″ X 11″ inserts) and it’s your own targeted direct mail marketing piece that rides along with 9 other vendors, professionals, business-owners, companies, corporations, etc.,

Here’s how it works. Once you pitch 9 other businesses, companies, corporations, people, etc., to see if they would like to be part of your direct mail campaign, and they say “Yes, I’m in”, tell them exactly how many people and to what specific zip codes and demographics you are going to be sending your package to. For example, let’s say you’re sending out 40,000 pieces in 5 zip codes. You figure out the price ahead of time. Then divide that total price by 9 – NOT 10 – so that the other 9 businesses split the entire cost of the mailing.

So, if it’s going to cost you $10,000 to send out 40,000 pieces, divide that by 9 rather than by 10, so that 9 people actually pay for the cost of having 10 pieces sent out. After all, you did organize, coordinate and facilitate the entire direct mail campaign.

This is an incredibly effective marketing idea and a win-win for everyone involved. It’s so inexpensive when you divide that total cost by 9 businesses – they’ll never know that they’re paying for you. Your piece gets to “ride for free” for as many direct mail initiatives or campaigns as you send out. It’s a fantastic way to test your direct mail pieces with absolutely no financial risk!

To Your Success,

Life Insurance Awareness Month Is Approaching

One thing I talk about a lot is creating marketing “campaigns.” Rather than just throwing an ad out, we want to target your market and hit them over and over (and over again) with one simple message in several different formats.

Lots of times, I’ll recommend that you send a postcard and then follow up with a phone call and then an email reminder. Same message, but different formats. This works for new prospects, cross selling home insurance, and even life insurance.

And when professional marketing campaigns just fall from the sky, ready for you to use? Then you should use them!

That’s why I love the materials available at LifeHappens.org for Life Insurance Awareness Month. Every September, LIAM is marketed across major TV networks and print magazines. So why not put those same tools to use for your book of business (BOB) and take advantage of that national marketing?

By using LIAM’s free Producer e-kit, you get tons of life insurance marketing materials. (Here is the link for all of the campaign materials.) There are printable flyers, Q&A documents you can use, videos, and logos. 

If you plan on promoting life insurance this fall, then I believe this is a great resource to help us create great marketing materials!