A Simon and Garfunkel song with the line, “my lack of education hasn’t hurt me none”. Well that may be just fine for most life insurance agents, but the fact that it hasn’t “hurt them none” isn’t really the point. How many clients are financially damaged every day by life insurance agents who refuse to learn about their own business?
You should see the test it takes to become a life insurance agent. It’s not even meant to weed out those that who were too lazy to study. Even the continuing education courses are for the most part a joke.
So it’s just sales right? What do you need to know other than “what will it take to get you to drive away in this life insurance policy today”? Well, allow me to express my opinion on this based on far more years in the business than the average agent will ever last.
If I were teaching the school, closing the sale would be left out. Knowledge of impairments, knowledge of insurance and estate law, and good customer service would be the curriculum.
How can an agent hope to do the best possible job for someone with heart disease or a history of cancer if you don’t know what the results of a stress test or a pathology report mean? How can an agent advise a client who is treated for depression if they don’t know the difference between situational or chronic depression? How can an agent hope to help someone who has been through drug or alcohol treatment if they don’t know how underwriters from different companies view the issue? How can an agent help a private pilot find the best life insurance pilot if they don’t know the difference between IFR and VFR? The answer to all of these is the agent can’t properly help those clients because they haven’t bothered to educate themselves.
How can an agent give proper advice about the use of life insurance in estate preservation if they don’t understand estate tax law? How can an agent advise a client on the need for a life insurance trust if they don’t understand the tax law that applies? How can an agent even represent the products unless they know the regulatory implications of their advice? Again, they can’t!!
A poorly educated life insurance agent is bad for the client and bad for the business. I honestly believe that states shouldn’t take the licensing of agents so lightly. A person should have to prove knowledge way beyond what is currently required before they are ever allowed to give advice to someone about matters that will impact that person’s family in critical ways.
And you ask why does this bother me so much? Because it allows someone with a gift for selling to give bad advice and damage clients and get paid for it. Just my opinion of course.
This post is somewhat dated. Life insurance underwriting is changing and evolving continually. For more updated information check out some of the key word links. If you have a specific question or topic you need information for do a search. If you don’t find the answers you need contact me and we’ll make sure you get the information that is important to you.
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.
You make some powerful points. And coming from someone with no knowledge of life insurance, your points make me feel ill to realize how poor and unrealistic the current licensing procedures are. How is it possible that the licensing standards are so strict for a person trying to pass the CPA exam and so lax for potential life insurance agents? Since you are in the business, perhaps you can do some brainstorming and direct your arguments to state representatives who can initiate more realistic changes that will result in higher entrance exam standards.
You dont understand (your) the salesman job. It is the job of an UNDERWRITER to understand the health tests and the pathology reports. Furthermore, depression, drug usage and alcohol abuse usually disqualifies for ANY insurance company. People who want to travel out of country, fly airplanes, and scuba dive are high risk too. And if you selling life insurance for estate purposes you’ve got to be peddling high cost, low coverage, whole life polices which aren’t right for ANYONE.
Why don’t you do what right for the vast majority of families. 70% of Americans have NO insurance and don’t need the complicated expensive stuff. Simply things and sell them high coverage, low cost term insurance. Then have them invest the difference so when they are 60 they no longer need any insurance.
Frederick,
Thanks for your input. Your understanding of the insurance business actually paints a very clear picture of the problems with the industry. Not all companies and underwriters view health or mental issues the same. If I, as an agent, don’t have a good understanding of those issues and know what questions to ask I could, and a lot of agents do, place your business in front of the wrong underwriter ending in an unnecessary decliine.
Your blanket statement about depression, drug use and alcohol abuse isn’t true of all companies and the same could be said of your statement about foreign travel, aviation and scuba diving. While many companies run from that business, others accept it. It is, again, the agents job to know where to place your business for the right outcome.
I do not and haven’t ever “peddled” whole life insurance. I think 90% plus of life insurance needs are well covered by term insurance and for those permanent needs, such as estate preservation, final expenses, etc, I always recommend universal life with a no lapse guarantee. Not complicated and not expensive.