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CheckMate Selling^®

From the Desk of
Robert B. Ritter, Jr.
President/CEO, InsMark, Inc.

Release Date: May 2011

A cash value life insurance policy is a unique financial instrument, and its value is best measured in a comparative environment. This is why virtually all InsMark presentations involve “Compared to What”. This logic appears throughout this Marketing Alert, and it will prove invaluable to your clients as they consider your recommendations.

Click here to review a PowerPoint presentation featuring comparative logic involving the sale of a personal life insurance policy. (Many of our licensees claim this is one of the best presentations we have ever made available.)

Continue reading below after you have reviewed the PowerPoint.

The presentation logic contained in the PowerPoint presentation uses a strategy we call Checkmate Selling^®. This includes use of the following illustration modules from the InsMark Illustration System and includes the following steps:

1. Analysis of the Face Amount Required: “Do I need any, and if so, how much?” This part of the presentation strategy is dependent on the results from a Survivor Needs Analysis (“SNA”), a module located on the Personal Needs Analysis tab that defines the need for coverage and forms the basis for your presentation.

Note: Skip this step if you’re involved in a package sale as opposed to needs selling (we skipped it in the PowerPoint). If you are licensed for the InsMark Illustration System (Version 15.1 or higher) and want to review an SNA Case Study, click on Sample Illustrations on the lower right corner of the Workbook Main Window of the System, go to the Personal Needs Analysis tab, select Survivor Needs Analysis, and click on Continue.

2. The Recommended Insured Plan: Your primary illustration goes next (or first if you have skipped step #1). This illustration is the one you prepared from illustration selections located on one of our tabbed sections, e.g., Personal Insurance, Executive Benefits, Split Dollar, etc. For those times when you have no specific InsMark illustration available for your prospect’s or client’s situation, use the Illustration of Values module and customize the header to reflect the circumstances of your presentation. We did this in the PowerPoint and customized the header to read “A Life Insurance and Retirement Strategy”. The Illustration of Values module is located on both the Personal Insurance and the Executive Benefits tabs.

3. Dollars of Benefits for Pennies of Cost: This module emphasizes the efficiency of life insurance death benefits by measuring the cost of life insurance per $1.00 of death benefit. It is an effective part of CheckMate Selling^®, and the module is located on the Personal Insurance tab.

4. Term and Invest the Difference:  Running your source data through this InsMark illustration lets you “head off” the issue of term insurance when you are not present to rebut it.  (This can occur when your prospect happens to discuss your planning solutions with other advisors.)  There are many who believe term insurance is always the “best buy”.  It usually is not -- at least for those with the cash flow to purchase either form of coverage.  However, this point may need to be demonstrated forcefully. The Term and Invest the Difference module is located on the Personal Insurance tab.

Some of you may not want to bring up term insurance as a possible solution.  Using an example from the PowerPoint, we think you need to arm your prospect or client for the occasion when an uninformed adviser asks  “Why would you ever consider spending $20,000 for something you could buy for $800?” and you’re not around to help with the answer.  If you have taught your client “why” ahead of time, he/she is much more likely to disarm the adviser.  Here is a terrific question to train your prospect or client to ask in such a situation:  “Do you dislike cash value life insurance so much that you recommend I sacrifice yield just to avoid it?"

5. Various Financial Alternatives: Use of this illustration is designed to eliminate other funding considerations. As you run the source data from the recommended insured plan through this illustration module, it almost always proves that your insurance solution is superior to other alternatives, none of which include the invaluable life insurance death benefit. You may illustrate up to four financial alternatives. The Various Financial Alternatives module is located on the Personal Insurance tab.

Note:  Some users prefer to compare the life policy to one financial alternative.  If so, we suggest you use the Other Investments vs. Your Policy illustration module also located on the Personal Insurance tab.

Note:  Various Financial Alternatives and Other Investments vs. Your Policy should not be used with variable policies as FINRA is opposed to comparisons of life policies to investment alternatives.  One way to produce a complying illustration for this section of your CheckMate Selling® presentation that compares a variable policy to an alternative is to utilize the Term and Invest the Difference module located on the Personal Insurance tab and set the term rates to $1.00 (that’s not $1.00 per 1,000, it’s $1.00 total).  When a variable policy is illustrated in this module, FINRA regulations require you to use the same interest rate for the “difference” that is the “current” interest rate for the life policy.

6. Insurance Company Source Proposal: This, of course, should be included in all cases.

Some licensees say five to six are too many illustrations for some prospects and clients. If I had to limit the number, I would use at least three:

Illustration of Values (step 2)
Term and Invest the Difference (step 4)
Insurance Company Source Proposal (step 6)

-or-

Illustration of Values (step 2)
Various Financial Alternatives (step 5)
Insurance Company Source Proposal (step 6)

If you are not licensed for the InsMark Illustration System and want more information, contact an InsMark Account Executive at 1-888-InsMark (467-6275). Institutional inquiries should be directed to David A. Grant, Senior VP - Sales, at 1-925-543-0513 or dag@insmark.com.

Important Note: Policy loans reduce policy cash values and death benefits, and the lapse of a loaned policy could result in severe tax ramifications to the policy owner. Be sure to consult a professional tax adviser if you have any questions about this.

IRS Circular 230 Disclosure

In order to comply with requirements imposed by the IRS which may apply to this document (including any attachments, enclosures, or referred material) as distributed or as re-circulated, please be advised that the material contained herein is not intended or written to be used, and it cannot be used, by anyone for the purposes of avoiding any penalty that may be imposed by the Internal Revenue Service under the Internal Revenue Code. In the event that this document (including any attachments, enclosures, or referred material) is also considered to be a “marketed opinion” within the meaning of the IRS guidance, then, as required by the IRS, please be further advised that the material contained herein is written to support the promotions or marketing of the transactions or matters addressed by the material contained herein, and, based on the particular circumstances, you should seek advice from an independent tax advisor.

“InsMark” and “CheckMate Selling” are registered trademarks of InsMark, Inc.

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