Don’t Forget The Babies!

Increase Your ANBP By Adding The “Come-Along Sale“ To Every Policy You Sell

How many of you reading this article either have grandchildren or children, or have a client that has grandchildren or children? All of us, right? And besides our spouses, whom do we love more than our “babies”? My wife Rose and I are lucky enough to have five children and seven grandchildren. And like every parent or grandparent, we want to do what’s best for them. Time after time we reach into our pockets and buy them gifts for birthdays, Christmas, Hanukkah, graduation and the list goes on. We think nothing of spending money on things that will not stand the test of time. How many of you still have the toys you played with as a kid lying around your home? Not many I would venture to guess.

What if we changed our thought process? What if we thought about it like we do when we consider their education? Several of us have started 529 plans for our kids to provide for their education, but have we thought about a way to guarantee their insurability and lock in the cost of that insurance with a product that builds a cash value and costs pennies on the dollar?

Many agents have gotten away from whole life sales because our clients thought it was too expensive—and for years certain groups preached buy low and invest the difference (which most of us never did).

What if we changed the conversation though, changed the narrative? What if we offered a way to buy coverage at very low prices before a child attains the age of 18—and even better, we lock-in the price for the life of the policy? In addition, the policy would provide five opportunities to increase the coverage up to the original face amount (at either attained ages or for certain life events). That means that on a $50,000 policy, if the child exercises all five options, he or she could buy up to $300,000 in their lifetime. And…the policy would build cash value.

Some of you reading this article are old enough to remember the “Be Your Own Bank” concept. Basically, you buy a cash value life insurance policy with low interest rate loans, then you borrow from yourself (your policy) and pay interest back to yourself (your policy) instead of a bank. The challenge with this sales concept is those products are usually too expensive for us when we are younger, and we don’t have enough time to build up enough cash value to take a loan.

Earlier I mentioned Rose and I have seven grandchildren. They range in age from 1 to 13. I have a quirky habit of naming our grandbabies with “B” nicknames. It started with our youngest daughter who I affectionately call Biscuit and it just stuck. Weird, I know, but they all love grampy’s quirky nicknames.

When we bought the whole life policies for our grandchildren last year, they were obviously a year younger. The table shows the annual costs for our seven grandchildren.

Sladek Table 0719

For less than $900 per year we were able to purchase each of our grandkids a $25,000 whole life insurance policy.

Somewhere between their mid-forties and mid-fifties each of them will have more cash in the policy than we paid in premiums. And, as we know with a whole life policy, the cash value will equal the face amount at age 100.

Now I realize that an $852 premium sale is not going to change any agent’s income significantly, and, in many scenarios, there may be less than seven children in a family. But that is exactly why I call this the “Come-along Sale.” What if we at least ask this question of our clients: Would you like to provide for your child or grandchild’s future and guarantee their insurability for pennies a day?

A 10-year-old child covered for the maximum amount of $50,000 is only $23.50 per month or $282 per year. An agent who sells just three of these policies each month adds an additional $10,000 of ANBP to his or her bottom line every year. For a brokerage agency, if just ten of your agents add this to their practice, it could add over $100K per annum to your sales.

I think you get my point here. This sales idea is not going to make any of us rich! But it will help grow our businesses and protect families. And maybe, just maybe, what started out as a little sale will be what is needed to help the next generation understand the importance of life insurance.

So consider adding a Children’s Whole Life policy to your sales conversations. It’s a great way to help your clients start protecting their families and planning for their future.

Michael “Slades” Sladek is a national sales director with Mutual of Omaha. In his current role he is responsible for sales and marketing to industry leading NMOs and BGAs and managing a team of seasoned sales professionals.

Slades has almost 30 years in the financial services industry. He is an accountant by training and started his career at KPMG Peat Marwick as a tax accountant in the late 1980s.

Slades has a Bachelor of Science in Accounting with a double major in Economics from Northeastern Illinois University and received a Master’s of Science in Taxation from DePaul University.

Sladek can be reached at Mutual of Omaha, 3300 Mutual of Omaha Plaza, Omaha, NE 68175. Email: Michael.Sladek@MutualofOmaha.com.