Insurance Agents and Life Settlements

To the inexperienced, life settlements can seem both confusing and daunting. Since most insurance agents fail to inform their clients about the benefits of life settlements, most senior citizens are not well versed in how these settlements work. This leaves some seniors vulnerable to financial ruin.

Why do insurance agents rarely discuss life settlements?

One reason is, simply, that these professionals are not obligated to discuss this subject matter with their clients. Another reason is that, in some contexts, insurance agents who are not experienced in this area lack the education necessary to discuss life settlements with their clients. This particular area of study requires additional specialized coursework, a task that most agents neither have the time–nor the inclination–to pursue.

Even if a life insurance agent is interested in learning more about life settlements, very few continuing education opportunities on this subject are available for life insurance agents. Therefore, not surprisingly, few life insurance professionals are aware of the few CE opportunities that touch on this specialized aspect of life insurance–and fewer still take advantage of these CE opportunities.

Since most agents are inexperienced in life settlements, few agents broach this topic in their conversations with clients, unless the client explicitly brings up the subject and insists on talking about it. For most insurance professionals, this is not a problem because the media does little to make the general public aware of the life settlement option, leaving most senior citizens unaware of, or ill informed about, this important financial option. So, seniors rarely bring up the subject when visiting with their agent.

Insurance commissioners in some states are beginning to acknowledge the need to educate life insurance professionals and the public about the role of life settlements. But, this has not yet resulted in a dramatic increase in continuing education opportunities on this subject in the insurance community.

Meanwhile, a similar situation exists in the world of investment advisors. Few CE courses on life settlements for investment advisors are available. So, few investment advisors understand that a life settlement is a worthy investment to include in one’s financial portfolio, along with stocks, bonds and mutual funds. Subsequently, few clients are ever encouraged to consider adding a life settlement to their portfolio.

Occasionally, insurance agents may elect to discuss with life settlement advisors alternatives for their clients. However, the agent is simply too inexperienced to market life settlements in a persuasive fashion. As noted, very little education is provided for agents in the realm of life settlements, leaving them at a disadvantage in this area of knowledge. Also, not all those who market to seniors appreciate the nuanced communication process required to help seniors effectively make strategic decisions that enhance their financial well-being. Most direct marketing tactics for introducing senior citizens to life settlements are not very effective.

The limited number of financial professionals who are experienced and knowledgeable about life settlements, the limited opportunities for life insurance careerists to gain specialized knowledge and experience in this field, and deficiencies when it comes to informing the public and marketing to the public concerning life settlements, create mixed messages for seniors who want to make sound decisions about their life insurance policies.

Agents need to understand that information is a key component in upholding customer satisfaction. Clients deserve to be well informed about all of their options. Furthermore, agents need to understand that today’s elderly are sophisticated enough to research and learn more about their financial options. Seniors know that to keep a life insurance policy in force is not the only option available to them. When it comes to understanding their options, seniors today are not as likely as their predecessors to rely solely on the words of their life insurance agent if he or she only dishes out traditional advice that was served to seniors in the past.

These days, seniors need and want to conduct independent research in order to determine their best course of action. Today’s financial professional who needs and wants to serve seniors must work hard to earn their client’s trust by being knowledgeable about financial alternatives that may have been seldom considered in the past.

Seniors, do your research. Agents, get ready for seniors who want to know if the life settlement contract is right for them.