Life Insurance Broker

By Steven H. Kobrin, LUTCF
Copyright © Steven H. Kobrin, LUTCF.
All rights reserved.

Your life insurance broker is an important resource in financial planning. Let's review the basics of choosing a life insurance broker.

Specialist

The life insurance broker must be a life insurance specialist. People who sell auto insurance, medical insurance, financial planning, or investments just can't have the time and resources needed to excel in each marketplace.

Our resident expert, Steven H. Kobrin, LUTCF, was interviewed by Registered Rep magazine on the topic of financial planners and other non-specialists selling life insurance products. "... some of the hardest aspects of insurance sales - prescreening clients on delicate medical matters, for instance - are unlikely to be mastered by someone for whom insurance is simply a complementary product. 'It's almost better that somebody becomes a priest or psychologist or social worker and then enters this business,' he says." (Insurance and the Well-Rounded Rep, Jun 1, 2003)

Field Underwriter

The life insurance broker must be a good field underwriter. This means he must have a strong familiarity with all the risk factors involved in underwriting current health, medical history, avocations, etc.

People Person

The life insurance broker must be a good people person. A high degree of caring and sensitivity must be expressed when asking people about personal and sensitive topics such as their medical treatment.

Advocate

The life insurance broker must become an advocate for his client. The client's interest must be promoted and protected - not only through the prequalification process, but all through underwriting as well.

Independent

The life insurance broker must be an independent representative of many companies - as opposed to a captive agent with one company. Companies specialize in underwriting different types of risks - and the broker must have access to a wide variety, so the most competitive company can be selected for each client.

Many Strong Relationships

The life insurance broker must have relationships with many insurance distributors, or general agencies.

Life insurance general agencies may distribute products for many companies, but they have strong relationships with only a few. Therefore, the broker must have relationships with many agencies so he can - through them - have strong relationships with their best companies.

Good Businessman

The life insurance broker must be a good businessman. He must follow the basic business principles of dealing honestly with his clients, keeping his word to them, and delivering a timely and efficient service.

Next...

Next, we'll look at how a poorly chosen broker can negatively impact your life insurance rates.