Life insurance agents may have the ability to compare life insurance quotes from different providers, but they also may not. There are different kinds of agents, and every agent to some extent has a conflicting agenda with their clients. The client’s agenda is to get the least amount of life insurance they need to fulfill their needs and to do it at the least expensive cost. The agent’s agenda is usually to make the most money. The ability to compare quotes, and the extent of the ability to compare quotes, vary widely amongst different agents. This is why using a quote comparison tool like Life Ant can help clients understand the insurance marketplace, and may help them obtain a lower cost policy than the one offered by their agent.
Here are a few typical types of life insurance agents and financial advisers who may sell life insurance.
Types Of Agents
Career Agent At Major Firm
The most common type of life insurance agent is the career agent. This is the type of agent/financial adviser who works for a major life insurance company such as Metlife, New York Life, Northwestern Mutual, Genworth, or Prudential. These advisers may or may not have the ability to sell life insurance from outside their own company. Whether they do or do not, they do not have much incentive to do this. The company pushes them to only sell their own companies insurance, and the chances that the agent will look to outside sources are very slim. Companies also require them to sell a certain amount of insurance every year, and failing to reach this threshold may disqualify them from working at the company in the future.
Even if these agents are willing and able to look at other sources of less expensive insurance, they need what is called an appointment with each and every company. This means that the agent needs to individually be approved by each company in order to sell their insurance. The likely hood that an agent will be appointed with every company is non-existent.
Typically, major companies do not allow non-career agents to sell their whole life insurance or other forms of permanent life insurance. This means that if an agent is comparing quotes, they are only doing so for term life insurance. If a client is in the market for whole life insurance, they will only be recommended the insurance products from the agent’s company almost exclusively.
If the agent is offering to compare term life insurance quotes for the client, they may find a good deal. There is no guarantee that the comparison will be run across every company though, and it is still beneficial for clients to compare for themselves.
The independent life insurance agent is not a career agent for any specific company. This typically will allow them to compare insurance across different providers, but the scope of their ability to sell may still be limited. They are still subject to individual appointments from each company, and can not necessarily obtain the rights to sell all products from every company. These agents may be willing to offer a limited comparison for clients, but at the end of the day, they still are incentivized to sell the product which will yield them the highest commission rate.
There also is the issue of the quality of independent life insurance agents. If they are not attached to a major company, it can be difficult to assess the level of service, and level of knowledge and expertise of the agent. If one decides to use an independent agent, we recommend to our clients that they look for signs of expertise such as a CLU designation.
Wealth Managers Who Also Sell Life Insurance As Part Of A Comprehensive Financial Solution
The third group of life insurance salesmen is the wealth managers. These financial advisors usually deal with a premium clientele, and they often have advanced degrees and certifications to go along with their name. During the process of designing a comprehensive financial plan for their clients, they usually will identify a need for life insurance. They will either sell the life insurance themselves or split the commission with another agent who specializes in writing life insurance cases to who they will refer the client.
Because of the trust that most clients confer in wealth managers, they can usually exercise enormous latitude with regards to price. This means that the advisor will not normally compare quotes at all, but will present their own companies proprietary products. This does not necessarily mean that the client is getting a bad product, but it may also mean that they are paying more than they need to. Wealth managers are excellent at accurately identifying the life insurance needs of clients, but they usually have little time or interest in finding the cheapest solution for the client.
Quote Comparison at Life Ant
At Life Ant, we do not receive commissions for life insurance sales. This aligns our interests directly with our clients, finding the least expensive life insurance. We do this by comparing quotes across all major providers and letting our clients chose who to talk to.
Even if you are working with an agent, by comparing quotes you can get an idea of the general market prices for the amount of life insurance you are seeking. By putting information in our client’s hands, we enhance the purchasing process for our clients by making them educated and more confident in their decisions. To compare quotes for yourself, enter your zip code above.