Why did I take the word “insurance” out of my vocabulary

Some cases will take years to materialize. When I started working in the high networth market, there was a particular client that took about three years from the day I met him (cold call) to the day we shook hands and he became a client. Fine individual, six figure annual premium, solid longevity, all looked great. At the time he wasn’t familiar with the intricacies of whole life and neither was his accountant, which partly explains why it took this long to solidify.

The first time I went to see the man we discussed a particular asset class that would bring some level of diversification to his existing portfolio. His business and his home aggregated for about 95% of his networth. Not atypical. I always try to keep things real simple when I meet an individual for the first time. I walked him through the different types of asset class he could invest in, one being this insured deposit fund (you make a deposit, it’s life insured and it builds a fund).

He certainly liked the idea and the fact that he could grow this nest egg slightly above inflation, limited volatility, return uncorrelated to the market and would be able to access some of the liquidity if he needed to. We probably met 7 or 8 times during that three year span. By the time we wrote the application, he said to me; is this an insurance policy? I said let me check if there’s an insurance component, there might be something included with it.. (I’m kidding). I said yeah there’s a built in insurance policy so when your carrots are cooked, your wife and your kids will get bundles of money, tax free. He said; is that right eh? Well this is awesome.

I didn’t mention the word insurance for three years and some people might think it’s misleading but he never asked about it and he certainly wasn’t going to go through an application and do a medical without finding out. I just didn’t rush throwing that equation into the mix because three years earlier the death benefit wasn’t the main attraction and if I sold the policy based on that premise alone, I wouldn’t have had the honour to get to know this gentleman any further. At the end of the day, the insurance component turned out to be a nice little surprise and he viewed it as an added bonus to the overall strategy.

When you go on a date, you enjoy the wine, the food and the company but you don’t talk about what’s going to happen after dinner. You let that be a surprise. The same goes when you’re selling a certain type of life insurance.