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Find new clients through consulting on life insurance policies

Liz DeCarlo

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Drawing on your expertise and using a fee-based model can increase revenue.

In 2013, Julian H. Good Jr., CLU, ChFC, made a major change: He transitioned from a career producer with a major company to an independent advisor. He continued to offer comprehensive financial services, but he also added fee-based life insurance consulting, where he would review high-value policies and advise on any changes needed.

“So many people don’t know or understand what they have, especially with group benefits,” said Good, a 35-year member from Metairie, Louisiana, who served as MDRT President in 2011. And, as agents and brokers leave the business, the companies often are not monitoring life insurance policies.

Life insurance consulting is something no one else in his community provides, which separates Good from other advisors in the area. “They’re able to have their policies evaluated and monitored by a professional,” he said. “No one else is going to bring that to the table.”

It’s also a niche area where strategic partnerships come into play, as accountants and other professionals refer their clients to Good. “So many don’t understand basic life insurance contracts,” he said. “I’ve spent my entire career being good at something and I get paid for my expertise.”

Good took the time to answer some questions about how to manage a life insurance consulting proposition.

Q: How do you charge for this service?

A: I charge an hourly fee for my time. I don’t charge for my staff’s time. I let the client know upfront how much I charge per hour. However, I don’t ask for a portion of the fee before I begin, since I never know how much time I’m going to spend.

Q: What are you looking for in the policy consultation?

A: I review the policy, all annual summaries, illustrations, brochures, anything the client can find. I ask them what was happening when they bought it and why they purchased it. I want to determine suitability, affordability and if it’s the right product. I’m looking at if they can afford to pay future premiums; they may have to do a reduced paid up. Will this drain too much of their assets in the future? This is simple stuff, but no one else knows about it.

Q: How many hours does it take per policy?

A: It depends on how long it takes to get information. I have to order in-force illustrations and gather other information. A simple policy might take two to four hours. Multiple policies average eight to 10 hours. Make sure you never guarantee how long it will take upfront, since these are big policies and can take more time.

“They’re able to have their policies evaluated and monitored by a professional. No one else is going to bring that to the table.”

Q: Is it a consulting agreement? A contract?

A: It’s an open-ended agreement that can be ended by the client or me at any time. Inevitably, about 90 percent of the people I work with do become clients and are fully serviced.

Q: What if there are problems with the policies?

A: They’re asking me for my opinion. I have an ethical and fiduciary responsibility to tell them the truth, based on my experience. The recommendations report and analysis is written so the client understands what they’re reading, and it’s not proprietary, so they can share it with their advisor, friend or family member to read. I include a disclosure that my findings, opinions and recommendations are based on my unique experience and consultations with others.

Q: Do you ever consult with the originating agent?

A: Sometimes. I’m in a small community, so if there’s an issue, we try to work on it together. If possible, I don’t want to see anybody incur fines. But a lot of these policies were sold by wirehouse brokers. If you come across this type of policy, look at it — there are probably problems.

Q: How do you present your recommendations?

A: I schedule a presentation in my office. The client is welcome to bring anyone to the appointment — their attorney, CPA or family member. I tell the client it’s the initial presentation, in case there’s more work to be done. Some projects last one month, some for years. After my recommendations, I tell them the implementation and action steps. It’s only after this first meeting that I prepare my bill.

Julian Good was a speaker at the 2018 MDRT EDGE.

Contact: Julian Good


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