We often hear people say that only term life insurance should be purchased for life insurance needs. Like so many broad statements, this is only correct in specific situations. Term insurance certainly makes sense for many people. Cash value products are not the same as investing in an annuity or mutual fund, but they do have their correct place in financial planning. This course looks at the roles each plays in an individual’s financial life.
No course can look at life insurance products without first defining what life insurance is and how consumers use them. The agent and consumer must determine how much life insurance is needed to protect the intended beneficiaries. Once the quantity of life insurance is determined, cost must be considered. Term insurance is an especially good choice for those who do not have much money to allocate for insurance.
Universal life insurance is not the first cash value or “permanent” life insurance policy sold so the course looks at the origins of this product and why it gained prominence over other cash value products.
The course looks at life insurance contracts, defining what a contract is and how it should be applied. Cash value life insurance products, including annuities, now have a new use, one that was not intended by the insurers: money laundering. The federal government is concerned enough about this problem that agents must now complete education on anti-money laundering procedures.
Policy features of term and universal life products are discussed including nonforfeiture options, dividend options, and settlement options. State required provisions, general provisions, and allowable provisions are also considered. Beneficiary designations are looked at as well as special clauses.
Group contracts are discussed, including eligible groups, creditor-debtor groups, and underwriting advantages for group products. The course looks at the contract participants, key person insurance and buy-sell agreements.
The last chapter on ethics is designed to provide information on ethical business and insurance practices. As such, it addresses ethical topics that an agent would deal with in his or her day-to-day insurance work.
Most of us consider ethics to be the topic of right versus wrong and this is essentially correct. The difficulty comes in determining whose values of right and wrong should be used. This course addresses the fact that insurance laws must always be followed, but beyond that who determines the “right” course of action? Since agents often disagree on which products are right for the consumer, beyond the laws that are imposed, whose values should be used?
Since ethics have no clear guidelines beyond the laws that are imposed on the insurance industry, this course addresses how an agent makes these value determinations. Due diligence and fair consumer practices are examined in the context of accepting personal responsibility in selecting and presenting products. Since agents must rely on their understanding of products, this course discusses an agent’s responsibility to read and understand the policies that they sell.
This course is designed for the agent who has past experience in the life insurance field, but new agents would also benefit from its completion.