I often meet with prospects who won't even entertain the notion of a fact finder or benefit analysis. All too often they treat the purchase of insurance or a financial product as a commodity. They feel confident that they have done their homework, read Suzy Orman or Dave Ramsey's advice and know what they need or want. That is not to knock Suzy Orman or Dave Ramsey. Their advice is generally very good and much needed seeing that many people have not had any financial literacy taught to them. However, the general fear that most of these prospects have is that they are going to be sold something that they don't want or need. Therefore, they refuse to do a fact finder in order to avoid the "salesman pitch." None of us wants to spend more money than necessary. Plus, there is the added false notion that insurance is often a "bad investment." If I had a nickel for every time I have heard, "I can put that money in the market and earn more," I wouldn't have to write blogs to educate prospects about why they should use me as one of their trusted advisors. While self insuring is not an unheard of practice, it is not always the best idea for the general population or the rich for that matter. Many people I speak with have or want a Plan A. They want to invest most of their money in instruments that will bring them returns of 8% or higher and buy only term life insurance to cover liabilities. This is when I ask the prospect, "What is your Plan B?" I usually get blank stares for a moment followed by the question, because a good question always deserves another question, "What do you mean?" What I mean is: "What will you do if the income stops?" "Who picks up the slack?" "Do you have other residual income if your main source drys up or can't work?" "How are you protecting the risk of losing your income?" "How long could you go without an income?" "Do you have available income protection at work?" "Do you have a will?" "Do you have a living will?" "Do you have an estate plan?" "Do you have a long term care plan?" If you own a business: "Do you have an exit strategy?" "Do you have some type of continuation insurance if you were incapacitated?" This and many more questions are part of building a Plan B. Many of you as you read through the list of questions all of a sudden realized that you do not have a Plan B or need to fill in some gaps. Questions to ask yourself are: "Does my employer offer income protection?" If not, why? "Who would run my business if I had a major illness?" Are you The Business? Since I am an old history teacher and fond of Socrates, I will end with the same question I started. DO YOU HAVE A PLAN B? Food for thought: Just over 1 in 4 of today's 20 year-olds will become disabled before they retire. Everyone should have a periodical benefit analysis done on both their personal and business needs to determine their exposure to such risks as untimely death or illness. Employers should offer their employees voluntary benefits in order to help them minimize these risks and to avoid an potential liability.
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