Keys to an Effective Policy Review

  • Originally published February 16, 2011 , last updated May 24, 2016

Policy reviews are one of the most under-used sales techniques in the industry. By putting a consistent policy review strategy in place, you have the opportunity to generate sales right out of your existing book of business, solidify your role as a trusted advisor, stay up-to-date on your client’s goals and ultimately identify needs that could lead to additional sales.

A policy review is like an annual check-up for an insurance policy. Given our current interest rate environment, there are certainly a lot of sick policies out there in need of attention. So this is a great time to get on the phone and start setting up some policy reviews with clients you've sold policies to in the past or prospects who didn't buy because they had existing coverage.

Another great strategy is to look at clients you’ve sold other products to. When you’re delivering the other product, ask if they have any inforce life insurance. Ask if you can review their existing coverage to make sure their needs are met.

Look for existing clients who:

  • Value your opinion
  • Have an existing permanent life policy
  • Have experienced a life-changing event — e.g. change in marital status, new home, planning for retirement, etc.
  • Are nervous about their policy's performance
  • Want improved guarantees
  • Want improved cash value potential

For tools to help your policy review process, download our Policy Review Sales Concept Kit here. You'll also get nine other concepts, including estate planning, annuity maximization, and buy-sell. Each kit includes:

  • Agent Guide
  • Agent Checklist
  • Consumer Brochure
  • Client Worksheet
  • Case Study Flyer

Converting Policy Reviews Into Sales:

Step 1: Identify what the client’s needs and objectives are with their life insurance coverage. This will allow you to identify areas that need improvement and create a “wow factor” if you can deliver a significant upgrade in that area.

Step 2: Review the current life insurance in force. Remind your client to bring a copy of his annual statement or in-force illustration. Is the policy performing as it was originally intended? If not, make sure that his goal for the life insurance is in line with how the current policy is performing.

Step 3: Look for life-changing events. If you have clients who recently married, divorced, or had a child, this could dramatically change their need for life insurance. Other changes that should raise red flags are new business ventures and recent moves. A few simple questions could reveal some major needs that aren’t being met.

Step 4: Surpass a client's expectations! Once you you know the clients goals, you’ve looked at their existing coverage and you’ve identified any additional needs, it’s time to see if you can help them. Maybe their current life insurance policy is exactly what he or she needs. Or, maybe you can lower their premiums, get longer guarantees, or generate more cash value. Surpass their expectations in these areas so they can't say no.

Four Ways to Surpass Expectations in a Policy Review

1) Same death benefit for reduced premium — If your client’s main concern is reducing their premium while keeping the same death benefit, North American's Custom TermGUL offers great value. Consider this actual case: a 47-year-old male who was paying $1,500 a year for a $250,000 UL policy. With the Custom TermGUL, you could offer the same $250,000 death benefit for only $485 a year (without the guaranteed death benefit rider).

2) More death benefit for same premium — If the client is comfortable with their current premium but wants to add more death benefit, you could sell North American’s Custom TermGUL for $1,500 in annual premium and offer $412,379 in guaranteed death benefit.

3) Improved death benefit guarantees — If it’s guarantees they’re interested in, the Guarantee Builder allows the client to choose the length of the guarantee period, up to age 120. For example, our 47-year-old client could continue paying his $1,500 in annual premium and get $307,000 in death benefit guaranteed to 100.

4) Improved cash value performance — With interest rates at their lowest level since the Kennedy administration, UL policies everywhere are literally imploding. People are watching the cash value of their UL policy decline and can’t afford the premium increases to keep it funded. North American’s Builder IUL is a great performance product with only a $25,000 minimum face amount.

As you can see, a successful policy review starts with asking the right questions. Discover as much as you can about your clients and tailor the case for their needs. It’s a great way to open the door to additional sales and referrals.

Contract with NACOLAH through Senior Market Sales and start selling the industry’s best lineup of universal life products.