Insurance Agent, Advisor, Or Insurance-Stockbroker

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Whom do you call when a client is serious about planning for their financial future? Is it possible to do this by an average life and annuity agent? Is it possible to do this without the help of a financial advisor? Some believe that an insurance agent and stockbroker can best serve them. It all depends.

You could lose everything if you don’t take the time to be cautious and avoid risky investments. Recent financial crises caused significant losses for many people with high to moderate investment net worth. Many will never recover. Some others have been too cautious over the past decade and paid a steep price for financial security and death.

Consider the pros and cons of each type of sales agent you are considering. There is no way to predict the best path. However, knowledge can help you determine which insurance and financial products are best suited for each type of sales agent.

Insurance Agent It is crucial that you only hire experienced agents with at least four year experience. A higher income will be earned by the best insurance agents. Life insurance should be their specialties. It’s not enough to have term life policies. You also need cash value policies such as universal life. Agents should also have an extensive history with annuities or 401K plans. This agent is being paid commissions. Life insurance commissions for the first year are usually very high. Second year renewals are proportionately very low.

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Beware of “rollers” An insurance roller is an agent selling you life insurance that sells for a great price the first year. You receive a call just before the second year and are able to make an appointment with this agent to review your coverage. The agent will then sell you almost the exact same policy for nearly the same price, but with a different company. Why? The agent gets the 70% commission for the first year instead of the 15% renewal. Adjustments are possible, but full-scale changes are often not.

Insurance Financial Advisor A sales representative should have at least 3 years of experience and be insured. This could often be CLU or CHfC, FIC. CFP or any other related to financial products and insurance. A variable contract license should be obtained by the advisor. This license would enable the advisor to sell mutual fund products and investment-oriented life insurance. A representative in this type of insurance should earn more than $75,000. Interviews should take place in one meeting. The actual recommendations should be made at a subsequent meeting.

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Beware of financial churners Someone who calls you frequently every few months to check your coverage is a financial churner. This is a new, hot variable annuity or mutual fund that’s superior to the one you have previously bought. Be aware of load fees before you make a switch. These are money taken from your total investment amount. This money is often used to pay your financial advisor and insurance.

Life Insurance/Stockbroker This is a stockbroker with the ability to sell you stocks, bonds, variable annuity and life products, regular life policies, and mutual funds. An average stockbroker with two years’ experience makes over $110,000 annually. However, this does not make the stockbroker any more valuable than the other types of sales agents. This is where you pay a lot for advice. Some people charge an hour. Are their hours worth it? You can also rely on them when investing in stocks for advice on when to buy and sell.

Be wary of “unusual investments” Stockbrokers can suggest a variety of products that could make your life richer or worse. Before you invest, make sure to verify any projections of return rates that seem too good to be true. You should be cautious when choosing life insurance companies. This is because the selection of companies is done by side-arrangements with certain life insurance companies. These companies might or may not be a good option.

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The last option is a life insurer agent who is affiliated with an independent brokerage dealer. This agent can be considered a combination of the three types. This agent has the advantage of independence. You have more choices, more companies and more options.

You can now decide which option is the best. Experience in planning and financial planning is better than inexperience. You have the option to choose.