Life Insurance Is Not..."Set It and Leave It"

June 2020

A new client has several existing policies that have not been reviewed or monitored by the selling agent since they were purchased. She is a 70 year old business owner with a key employee policy, a policy that is part of a buy-sell agreement, and multiple policies for the benefit of her family. We review the policies and find that, with current annual premium payments, they are going to lapse 11-15 years before the client’s life expectancy. What are the client’s next steps? A life insurance policy can have many moving pieces. It is something that should be reviewed regularly with your Trusted Advisor. In present times, when there are low-interest rates, and business pressures abound, it is ever so important to conduct these reviews.

Policies can be interest-rate sensitive, and reduced interest rates can create under-performance from a cash value standpoint. During times of low interest rates, carriers may also increase administrative and operating charges as well as, in certain circumstances, the underlying cost of insurance charges. In turn, these changes can result in higher premium requirements or additional premiums to keep the policy from lapsing.

 

This is the value of having Synergy Risk Management monitoring your life insurance policies – to ensure that your property is managed appropriately. If you have not reviewed your insurance planning in the last 2+ years, your next action should be to call our office at (713)333-0099 and set a meeting to evaluate your policy’s current state.

Insurance services provided by Synergy Risk Management, LTD.