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The Importance of Policy Reviews

Many clients fail to realize the importance of reviewing their critical financial security on an annual basis. This review is not restricted to the beginning of the year, and typically accumulates information throughout the year. Periodic policy reviews are an excellent practice to evaluate the actual performance of a specific life insurance policy to the predicted performance illustrated at the time of sale. Reviews have never been more important in an environment of low interest rates, volatile (and irrational) stock market performance and brilliant new product pricing and features.

Industry statistics have long suggested that substandard life insurance is the most persistent life insurance written. While the healthiest risks can easily move from carrier to carrier, rated risks are suspect of the underwriting process and typically appreciate the value of insurance and hold their policies dear.

Rated policies are held dear by substandard clients and enjoy excellent persistency – typically not receiving the necessary attention other, non-rated policies might enjoy for fear of the unknown: “Will I be able to find a more efficient or more appropriate product given my health history?” This persistency creates an environment that makes “rated” clients more vulnerable to the market environment detailed above.