Life Insurance Awareness Month

The Risk of Waiting

Life insurance can be a great planning solution in many personal or business circumstances.  Unlike other financial vehicles, the individual must qualify based on multiple conditions before including a policy in their portfolio.  Therefore, there are additional risks to navigate when implementing a life insurance policy.

Policy pricing is based on a risk assessment done by the insurance carriers.  The underwriters evaluate an individual based on their health, avocations, habits, lifestyle, financial standing, etc.  The ultimate policy rating is based on the favorability of the amalgamation of these aspects.

If one quality is negatively affected before the policy is placed inforce, the premium can become more expensive, or the policy might perform too poorly to meet the individual’s goals.  We consider this the “Risk of Waiting” and have demonstrated some examples in the graphic below.  A big mistake we see is when individuals think the problem will solve itself, and the delay can end up harming their family or fellow business owners.

We encourage you to review the portfolios of your top 5 clients and engage with them about their financial planning, including their legacy, succession plan, and estate plan.  This is what we enjoy doing for only a select number of families and family-owned businesses each year.  We look forward to working with you and your clients.