Life Insurance Guide For Advisors
The Advisor’s Guide to Life Insurance is designed to assist advisors in making better informed life insurance recommendations to their clients, and it also serves as an expert training tool for advisors and their staffs. This clearly written book provides information essential to the exercise of due care in the purchase and retention of life insurance policies. In writing this Guide, the authors’ primary objectives were to provide the necessary information for advisors to maximize the chances that policies purchased and maintained by your clients offer good value for the premiums paid, and that the insurance companies selected to back the policies are, and are likely to remain, financially sound.
The Guide serves as both a primer and a reference source, structured to address the needs of both those with less life insurance knowledge who are looking for a focused, integrated approach to the entire subject as well as more experienced practitioners who want to do quick research on a particular topic. Chapters can be read and used independently of each other. The authors are careful to define the major life insurance terms used, and when terminology is not standard, to list other terms understood in the industry to have the same meaning. For quick reference, a glossary of all defined terms is included in The Advisor’s Guide to Life Insurance. Information “boxes” are interspersed throughout the text that offer key insights and practical advice on a particular topic, as well highlighting short examples, tables, and figures.
- Part I: The Life Insurance Purchase: an introduction to why and how it is purchased, the role of advisors in the process, and the terminology used in the industry
- Part II: Assessing Life Insurance Company Financial Strength: sets out the characteristics and importance of an insurer’s financial strength, as well as the role of financial regulation of life insurers and accompanying policyholder protections. Also explains how ratings agencies work and other sources of information for assessing an insurer’s financial strength.
- Part III: Life Insurance Policy Fundamentals: A common-sense, intuitive approach to how companies price their products, including the actuarial aspects of insurance policies. These chapters cover the most common types of individually issued life insurance policies and compare and contrast these policies. A concluding summary of the contractual provisions included in life insurance policies and of various optional benefits takes the reader beyond the standard treatment of the life insurance policy as a contract.
- Part IV: Determining the Appropriate Policy for Each Application: illustrates the various family, estate, and business uses of life insurance.
- Part V: Life Insurance Illustrations and the Sustainability of Policy Values: introduces how to understand and use life insurance policy illustrations, and then explains how to dig more deeply to recognize their underlying assumptions and assess their sustainability as well as insurers’ intentions and practices in managing policy performance. Also covered is how to determine the appropriate funding level for various policies.
- Part VI: The Issues Involved in Ongoing Policy Management: examines both the desirability and necessity for regular policy reviews, as well as how to use an existing policy to provide values during an insured lifetime, not just at death.
Advisors who master this material will be able to make more informed and superior life insurance recommendations, which translate into a significant benefit for their clients.