I am a graduate of Dave Ramsey’s Financial Peace University and a firm believer in his financial guidance and yes, his thoughts on life insurance. I believe that both his passionate belief that people should have life insurance and that for almost everyone it should be term insurance are right on track. But, after careful study I don’t understand his endorsement of Zander Life Insurance as the only agency in the country that a person ought to go to.
This past week I was talking to client about his insurance quotes and he mentioned that he was going to compare our quotes with Zander. That’ s fair. If I can’t earn the business, I don’t deserve it. So we pulled up Zander on the computer and ran quotes for him. While based on his personal health information there will be some adjustment, for comparison sake he wanted to run the quotes at preferred plus. His birthday is 1/23/49 and he wanted a quote for $500,000 of 10 year term.
Zander has an easy to use quote engine and we soon had a spreadsheet of quotes, zander-instant-quotes_files.We discussed these quotes and I explained why it was important to have access to a wide variety of companies due to the underwriting foibles of each company.
We than ran quotes on the Hinerman Group website and found a bit of a disturbing difference, hinerman-group-get-a-quote.
Please note Dave’s comments at the top of Zander’s quotes. And please note that while our websites agree on the best company at that rate class, Savings Bank Life, Zander has skipped over 5 companies in between Savings Bank and their second best quote, Transamerica. Did they skip them because they are not “top notch” as Dave suggests? I don’t think so. The missing 5 are all comparably rated to SBLI and Transamerica.
Is it because those 5 offer inferior underwriting? Again, I’m not seeing that. In fact, if you are 5’10 and weigh 202 pounds, you will not get that rate from Savings Bank Life, but you will from Prudential Financial (Pruco). Dave talks about pre-existing conditions. Weight is the most common rate changer in the life insurance business.
Bottom line. Agencies delete certain companies from their quote engines generally to drive their customers in the direction they want. I don’t understand Zander’s logic but I know from having a quote engine that you don’t accidentally leave companies out. There appears to me to be some reason that Zander wants to have a larger gap between the first and second best quotes than actually exists. What’s up with that kind action Dave?
My 20 years of experience give me the knowledge and leverage to find reasonably-priced life insurance for people who have been declined or are paying more than they need to.
I was forwarded a copy of your recent blog comments and thought it was appropriate for me to respond since you seemed to challenge both our business ethics as well as Dave Ramsey’s motives for recommending our company. The premise of your comments that we selectively manipulate the results of rate comparisons to make the first carrier appear more competitive than all others is erroneous and could not be more incorrect. In the “one” comparison you illustrated we did show the most competitive option available from the companies we represent. The other carriers you noted we either do not represent or have chosen not to use them due to service or underwriting issues. Some of the companies you listed primarily deal only with their direct agents, not brokers, and require the agents to represent them for property and casualty lines (home and auto) which we do not. Others we have used in the past but chose not to use them currently because their service has dropped below a level we feel is appropriate for our clients…issues such as underwriting consistency and/or flexibility, policy issuance time, etc. In addition, you ran one set of quotes on just a 10 year plan. Dave recommends 15 and 20 year plans and endorses our agency because not only do we search for the most competitive rates but that we have been in business for four generations and excel at not only representing our clients interests but we will be here in 20 years while most agents are out of the business in an avg. of four. There are a great number of reasons that Dave recommends us, price being one element, and in your limited analysis we still seemed to find the best rate for the client.
Mr Zander,
Thank you for your response. You brought up some important points and I appreciate your willingness to discuss them.
Please let me clarify that I didn’t question Dave’s motives for using Zander anywhere in my blog. I would question if Dave has the underwriting knowledge to understand that the inclusion of the 5 companies in question far outweighs their exclusion. There is enough underwriting variance spread through even that small sample to be potentially significant to your clients.
So, you left out five companies because you do not represent them or have chosen not to use them due to service or underwriting issues. And you mention “some of the companies” that only deal with direct agents (captive agents) or that require agents to be licensed in property/casualty.
I am appointed with all of those companies for life insurance only and while all companies may have service issues from time to time, my experience has been that customer’s are rarely affected by that as much as we agents are, and if a little suffering through poor service on our part can win the right rate for our client, well, isn’t that our goal?
You mentioned that Dave recommends a 15 or 20 year term and I quoted a 10 year term. Dave recommends term insurance because it is appropriate for the need. He also recommends buying within your budget. So I have a customer with a legitimate 10 or less year need and a budget that will only allow him to buy $300,000 to $500,000 worth of term insurance. Should I skip past the 10 year term and quote him a 15 or 20 year term because Dave says so? Do you do that? Do you really believe that Dave means that?
I appreciate that Zander has been around since Dave was a little boy and that you will probably be around until he dies and that most agents don’t last for four years. Actually most don’t last one year. I don’t fall into the “most agents” category, so that’s really irrelevant. If you’ve been around for four decades you should have at least enough clout to overcome any insurance company issues that might impact your clients, so that you can fully represent their best interests.
Well I guess this may grow into a he said she said debate. My comment about the 15 or 20 year plan had nothing to do with recommending the wrong product to the client. It had to do with the limited nature of your research in the comparison before you passed judgement and posted your opinions online for all to see. The comapnies we represent and focus on are strongest in the 15 and 20 year plans but as you noted we still offered the lowest rate on the 10 year. The interesting thing about blogging is that it gives a voice to all, even if they don’t do all their homework before making their comments. Additionally, we have found that price is a very important element in our clients decision making process but the service issues that lead to frustrations and complaints are things that also guide our decisions. Our clients are greatly affected by carriers that quote one low rate but have a very low placement percentage at that underwriting category. Our clients are greaty affected by companies that take an extended period of time to issue policies when they have expirations of current policies or the company has lowered their rates but not staffed for the responding activity in new business. It is sometimes easier for a smaller shop to represent an insurance carrier than a large national organization such as ours because of the company’s marketing focus and desire to only deal with a certain type of agent force. You are quite aware of this since as you have mentioned you are not a rookie in the business but in the end that still had nothing to do with the price or quality of plan our client would have ended up with. We all deal with different business and marketing situations but implying that Dave is giving bad advice because our second place company was not as good as yours is a bit confusing and is an argument that lacks merit.
Mr Zander,
The difference with my blog is that I allow opposing opinions even, sometimes, when they lack merit.
It appears we may have to go our different directions with our different opinions since the only thing we seem to agree on is that the other’s argument is, well……the other’s argument.
I did a little more research by visiting your website and doing a more thorough group of comparisons with ours inclusive of multiple age groups and various policy values. The example you used was a male age 59/ age 60 nearest and the companies we represent were illustrated correctly on your blog comments. However, I am still dumbfounded on how you would come to the subversive conclusion that “Zander wants to have a larger gap between the first and second best quotes than actually exists” simply by viewing one quote. If you bothered to run other quotes you would see a consistency in the carriers we represent and offer to our clients and we have no control over the placement of companies when a rate is run. Our company simply represents different companies than yours. If you wanted to conclude that you had better options…that would be your opinion but since we still offered the most competitive option in your singular analysis it would not have “merit”. However, to draw conclusions that we manipulate quotes for our benefit and to our clients detriment is improper and offensive. In addition, one of the reasons that Dave recommends our firm beyond the price issues of our companies is the committment we have to his principles and the assurance he knows that we do not offer products that fall outside of his recommendations. A lot more damage is done to a listener who is sold an inappropriate plan. I noticed that you professed to be a graduate of FPU and in agreement with Dave’s principles. However, I noticed that you offer return of premium products (ROP)on your website which Dave has commented repeatedly that they are as bad as cash value plans and a rip off to his listeners. Should I assume that you would sell these products regardless of Dave’s advise because they offer a higher premium and in return higher commissions which you strictly benefit from? Some could come to that conclusion but I know there are various reasons and situations that impact businesses and before I posted an opinion of a company or person I would do more research. We all have business issues to deal with but our company has earned Dave’s recommendation and endorsement because of multiple committments to his listeners including price, service, types of products offered and a way of doing business that he feels benefits his listeners. We are proud of our business, the clients we serve and the professionalism of our employees…as I am sure you are of yours.
OK, OK. Take a breath. I appreciate your visit to my website. Return of premium information is available on my website. I’ve found it a very informative way to show people why it’s such a bad idea. If you read my blogs regularly rather than just when someone gives you a wedgy, you would know that. But then, that would require doing homework wouldn’t it.
I was adhering to Dave’s philosophy on life insurance before it was Dave’s philosophy. I will assume from your staunch support of Dave means that Zander doesn’t have any cash value policies on the books and I applaud you for that.
I’ll try this again. I’m going this way. You go that way. If I can be of assistance in the future, you know where to find me.
The fact that Zander doesn’t have and cash value policies on his books shows that he gives no regard to client needs
I disagree.