Skip to content
Financial Brokerage Inc.
  • Contracting
  • Quotes
  • New Business
    • Case Status
    • iGO-e-app
    • Drop Ticket
    • Medicare Supplement New Business Submission
    • Forms
    • Secure File Sharing Service
    • Underwriting
      • Accelerated Underwriting Guide
      • Nailba Field Underwriting Guide
      • Underwriting Requirements
      • XRAE
  • Incentives
    • 2023 Incentive Trips
      • The Big Island
      • The Prairie Club
    • Carrier Trips
      • Columbus Life – Bermuda
      • Columbus Life – 2022 Palm Beach St Thomas
    • Account Summary
    • Shared Success
    • Cash In on Your Success
    • Standings – See Where You Rank
    • Agent Referral Bonus
  • Social Media
  • Services
    • Advanced Life Case-Design Specialist
    • Blog
    • Branding
    • Email Marketing & Newsletters
    • Website Hosting
  • Training
    •  Basic Training for Life Insurance Sales
  • Login
Presented by Brian Leising This is the short-form life insurance needs analysis system I use with life insurance prospects and clients.  The ten minute conversation achieves the same answers as an inch-thick comprehensive analysis, without the fancy full-color report.  Here’s how it works: In part one, you were instructed to ask your client to take a piece of paper and draw a vertical line down the middle.  The heading on the left should be FIXED EXPENSES (reviewed in the first article).  The heading on the right should be ONGOING INCOME NEEDS.  Ask your client if their fixed expenses were paid off, would they be able to maintain their standard of living on the remaining spouse’s income?  If they hesitate or are unsure, suggest that when one spouse passes away, the remaining spouse and children will need roughly 70% of the former combined income to maintain their standard of living.  Usually they will need some additional income. Let’s use that 70% number for the right column.  Add the incomes of the couple and take that number times 70%.  That’s the income they still need if one passes away.  For example, if you had a couple with one spouse making $60,000 and the other making $40,000, one remaining spouse would still need $70,000 total.  That translates to an additional income need of $10,000 if the $40,000 spouse dies, or $30,000 if the $60,000 spouse dies. How can we use life insurance to provide that income stream?  I like to use easy math.  Let’s say we need to generate $30,000 per year.  A lump sum of $300,000 earning 10% interest would generate $30,000/year without reducing the principal ($30,000 times 10).  A lump sum of $600,000 earning just 5% interest would do the same (half the interest rate, double the lump sum).  You could split the difference if the client expects a rate of return in between, $450,000 at 7.5% interest.  Use your judgment and ask your client what return they would reasonably expect to earn based on their past investing experience. Once you have the numbers from both columns, add them together to arrive at the amount of coverage your client just told you they need.
Voya – Annuity and Asset Sales for May 15, 2015
Wabbits

Recent Posts

  • MYTHBUSTED! Four reasons for life insurance in retirement
  • Life Insurance Allocation Tool – A Quiz For Your Clients
  • Life Insurance Quoting – Beyond The Price, What Else Is Included?
  • Life Insurance Quoting – Getting Started With A Basic Price Comparison
  • Permanent Life Insurance Decoded How to tell one product from another

Archives

Categories

Meta

  • Log in
  • Entries feed
  • Comments feed
  • WordPress.org
Financial Brokerage logo
  • 402-697-9998
  • 800-397-9999
  • 17110 Marcy Street, Suite 100
  • Omaha, NE 68118
  • About Us
  • Privacy Policy
  • Blog
  • Change Password
  • Facebook
  • LinkedIn
  • Twitter
  • YouTube
  • All rights reserved ©2020 Financial Brokerage, Inc.
  • For agent use only. Not for public distribution.
Theme by Colorlib Powered by WordPress