Northwestern Mutual interview

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You just danced around the whole point I was making, that while you may be marketing the right products to the right client base, this internship structure does the opposite

It takes an intern in his 20s and gets them to hit up friends and family - most of whom are not the right clients for expensive insurance but are nonetheless pressured to buy, so that they help this person in their new career.

those are the type of clients who lapse policies after the intern is No longer selling insurance . they made the purchase just to help them out

SIS, did you post without reading my last post? It IS NOT about selling to F&F.

My post was typed before your follow up post

So you are saying this internship will not involve a senior rep selling products to the interns f&f? That they will simply be scouting out for referrals of. "Appropriate " clients ?

I have a hard time believing that

SUCKISSTAPLES said:   My post was typed before your follow up post

So you are saying this internship will not involve a senior rep selling products to the interns f&f? That they will simply be scouting out for referrals of. "Appropriate " clients ?

I have a hard time believing that


My post was more about a young agent doing this as a career and not as part of NML's college internship program.

As for the internship, if the intern's goal is to make as much money as possible, he should not call F&F. Instead, he should call people who are good prospects and then shut his mouth and let the senior agent make sales to these people.

The intern, if he's trying to scout it out as a possible job after graduation, should do meetings with his friends on his own. It will help him to understand the job and a senior rep won't have any desire to meet with his young drinking buddies.

SIS, don't get me wrong. It does happen the way that you are describing it sometimes, but this is not how it should happen and is typically not how it does happen at strong agencies. It's not what I learned and it is not how I train people. It's a recipe for failure.

BrodyInsurance said:   SIS, did you post without reading my last post? It IS NOT about selling to F&F.It most certainly is. My friend had an internship with NML. He used a soft sell approach but the ultimate goal was to sell whole life policies. He got his best friend to buy a policy from him. The friend was 20 (no dependents, virtually no assets or liabilities) and wanted to lock in his insurability, which is complete BS to me.

And your friend didn't succeed in the business. His friend dropped his policy. NML lost money on the sale. It was a lose /lose/lose situation when it gets done in this manner.

BrodyInsurance said:   And your friend didn't succeed in the business. His friend dropped his policy. NML lost money on the sale. It was a lose /lose/lose situation when it gets done in this manner.I never said the friend dropped his policy. He still has it.

Besides nml wouldn't lose money

They charge back the commission

caterpillar123 said:   BrodyInsurance said:   And your friend didn't succeed in the business. His friend dropped his policy. NML lost money on the sale. It was a lose /lose/lose situation when it gets done in this manner.I never said the friend dropped his policy. He still has it.

Well, hopefully, it works out. That's still not the point. Of course what you are describing happens to some extent. The benefit to NML for their internship program isn't getting some interns to sell policies to poor quality prospects. It's about recruiting college kids who have what it takes to ultimately become quality high producing agents.

dhodson said:   Besides nml wouldn't lose money

They charge back the commission


The charge back of the commission would be dependent upon when a lapse takes place. Regardless, early lapses are costly to the insurance company. Underwriting policies is not a cheap endeavor. There is the direct costs of exams and getting doctor records along with high commissions for however short of a period that a policy did stay on the books along with all of the time involved. Quick lapses are a money loser for insurance companies.

Exams and doctors records are very small parts. It's all about the commissions.

dhodson said:   Exams and doctors records are very small parts. It's all about the commissions.

So what? This doesn't change the fact that quick lapses are money losers for the company. Selling policies inappropriately lead to lapses. It helps nobody.

As for the accuracy of your statement, it depends when the lapse occurs and the premium involved.


For a $300 premium term sale that lapses after one month, it is about the commissions. For a $3000 premium WL policy that lapses after 10 months, commissions play a big part. Only 2 months of commissions need to get repaid.

Northwester agents sell much more term insurance than whole life.

I certainly am not saying that an intern or new agent won't sell a policy inappropriately to his friend. What I am saying is that selling policies to F&F is not the reason for calling on F&F. In general, there is one thing that a new agent needs to do if they are going to be successful. 1)Have lots of activity. In order to have lots of activity, they need to get lots of referrals. Without having a natural network to call, there is little chance to get the referrals needed to have lots of activity.

Without lots of activity (meeting with people), the agent will go broke before they get through the learning curve necessary to learn to sell.

Sometimes you just aren't realistic. If a friend is making referrals to other friends then it isn't very effective if he/she hasn't purchased a policy him or herself. If it is a permanent policy then odds will be high that the agent didn't act like a true friend.

Companies do nothing to curb lapse rates on policies even early ones but they could just by designing them to be over funded. About 1/3 of permanent policies lapse within 5 years but doesn't seem to stop or change the dynamic.

BrodyInsurance said:   You won't be selling overpriced insurance products to financially illiterate people if you are trying to succeed in the business. The NML target market is just the opposite of the that. Successful life insurance agents tend to be successful because of their ability to work with people who are financially successful. The target market for NML is attorneys, CPAs, doctors, business owners, and executives.As you are probably well aware, doctors are unfortunately some of the most financially illiterate people out there. They tend to be smart, extraordinarily hard working but also rather financially illiterate, as no part of their training or experience has anything to do with financial education. At the same time, they tend to have relatively high and very stable incomes, which, combined with their financial illiteracy, makes them some of the best targets for all the "financial advisors" and insurance salesmen. This is particularly true for those who completed their residencies less than 10 years ago, and the vast, vast majority of those pitches are specifically targeting those people. As I've previously posted, my wife is a physician as is the vast majority of our friends, so I am very familiar with all the pitches. The standard sales pitch tends to start out with the salesperson announcing that he/she "focuses on physicians and, because of their unique needs, has unique solutions tailored to their needs." There isn't a week that goes by that my wife and our friends and her physician colleagues do not receive these pitches.

The vast majority of lawyers tends to be just as financially illiterate, but the pitch to lawyers tends to be a little bit different. Lawyers tend to respond well to "prestige" type labels, so lawyer pitches tend to focus on all the vestiges of prestige that tend to make them feel better about the product.

At the end of the day, however, the products are all essentially the same as are the "financial solutions" being offered. The reasons that lawyers and doctors often end up buying them, even when they are not even in the vicinity of being optimal, is the fact that most of those purchasers are as far removed from being "financially sophisticated" as they can get.

i was having the same problem but it actually slowed down once people realized i understood the products likely better than they did. Ive begun to wonder if there is a secret dont call on this person list that i now belong to. I actually havent had a caller in person in a few months although of course i still get plenty of junk mail and email on the topic. Im imagine once they talk to you for 5 minutes they realize its time to move on. I have yet had a need to be cruel to someone once i became more knowledgeable on the topic. Once i explain how their talking points arent appropriate, they thank me for my time and move on.

while i cant argue that most physicians are financially sophisticated and really wouldnt want to, i think they actually are just normal. Most people dont understand these products. Physicians arent unique in this regard. None on his list as a group has a good understanding of insurance. Heck many agents dont, possibly even most, at least to the level that i think they should. In medicine there is an inherent trust of fellow physicians in different specialties unless there is good cause not to and i believe many of us make the mistake of thinking that other professions have the same level of commitment and knowledge that many of us do to our profession and thus you should trust their advice. There are repercutions in medicine if you purposefully provide care that isnt in the best interest of the patient...not so much in the financial advisor or insurance business.

dhodson said:   Sometimes you just aren't realistic. If a friend is making referrals to other friends then it isn't very effective if he/she hasn't purchased a policy him or herself. If it is a permanent policy then odds will be high that the agent didn't act like a true friend.

Companies do nothing to curb lapse rates on policies even early ones but they could just by designing them to be over funded. About 1/3 of permanent policies lapse within 5 years but doesn't seem to stop or change the dynamic.


One of us has been doing this for 20 years. It doesn't make much of a difference if the person giving the referral is a client or not. In fact, one of the biggest mistakes that a new agent can make is waiting for someone to become a client before they start getting referrals.

NML agents are taught (don't know if this is still true) that if they have 100 people to call (referrals or people they personally know), 30 of them will have a serious conversation with them and 10 will become clients with about 7 of them in that first year. If they wait to make a sale to get referrals and each person gives them 5, they now only have 35 people to call. They will quickly run out of people to call and be forced to have a cold calling practice. This is a recipe for failure.

If instead, they get 5 referrals from their 30 meetings, they have gone from 100 people to call to 150 and can build a referral practice.

My personal experience is that it makes virtually no difference whether the person giving the referral purchased something or not. The only thing that matters is whether that person is respected or not. If the person is respected, nearly every person will meet with me. If they aren't respected, nobody will meet with me. From a sales standpoint, it simply doesn't matter. The question usually doesn't come up, but when it does, one of two things happen.

Prospect: "Is James a client of yours."
Me: (If yes)"Because of confidentiality, I can't discuss individuals. However, please feel free to give him a call and ask about me."
Me: (If no) "He isn't. I told him that he was doing the right things already and he shouldn't work with me." (or something else that is true)

geo123 said:   BrodyInsurance said:   You won't be selling overpriced insurance products to financially illiterate people if you are trying to succeed in the business. The NML target market is just the opposite of the that. Successful life insurance agents tend to be successful because of their ability to work with people who are financially successful. The target market for NML is attorneys, CPAs, doctors, business owners, and executives.As you are probably well aware, doctors are unfortunately some of the most financially illiterate people out there. They tend to be smart, extraordinarily hard working but also rather financially illiterate, as no part of their training or experience has anything to do with financial education. At the same time, they tend to have relatively high and very stable incomes, which, combined with their financial illiteracy, makes them some of the best targets for all the "financial advisors" and insurance salesmen. This is particularly true for those who completed their residencies less than 10 years ago, and the vast, vast majority of those pitches are specifically targeting those people. As I've previously posted, my wife is a physician as is the vast majority of our friends, so I am very familiar with all the pitches. The standard sales pitch tends to start out with the salesperson announcing that he/she "focuses on physicians and, because of their unique needs, has unique solutions tailored to their needs." There isn't a week that goes by that my wife and our friends and her physician colleagues do not receive these pitches.

The vast majority of lawyers tends to be just as financially illiterate, but the pitch to lawyers tends to be a little bit different. Lawyers tend to respond well to "prestige" type labels, so lawyer pitches tend to focus on all the vestiges of prestige that tend to make them feel better about the product.

At the end of the day, however, the products are all essentially the same as are the "financial solutions" being offered. The reasons that lawyers and doctors often end up buying them, even when they are not even in the vicinity of being optimal, is the fact that most of those purchasers are as far removed from being "financially sophisticated" as they can get.


Doctors are only financially illiterate to the extent that we are going to call our entire population financially illiterate. Some of the pitches to doctors are simply about marketing and some are the truth.

I previously mentioned that I worked with a bunch of people who were making $500K + and did it in very different ways. 2 of them did it working strictly with doctors. They built their practice entirely by selling disability insurance to medical residents. The pitch, "focuses on physicians and, because of their unique needs, has unique solutions tailored to their needs" may be a pitch, but it was/is also true.

What makes these physicians different than other people? They are able to acquire very large amounts of debt while still having very small incomes, but with the expectation of much higher future incomes. What makes the solution unique? They can get disability insurance that has a benefit of more than 100% of their current income with the ability to buy more in the future with no additional medical underwriting. At the same time, the guys that I worked with could sell these policies on a simplified issue basis with lower pricing.

dhodson said:   i was having the same problem but it actually slowed down once people realized i understood the products likely better than they did. Ive begun to wonder if there is a secret dont call on this person list that i now belong to. I actually havent had a caller in person in a few months although of course i still get plenty of junk mail and email on the topic. Im imagine once they talk to you for 5 minutes they realize its time to move on. I have yet had a need to be cruel to someone once i became more knowledgeable on the topic. Once i explain how their talking points arent appropriate, they thank me for my time and move on.

while i cant argue that most physicians are financially sophisticated and really wouldnt want to, i think they actually are just normal. Most people dont understand these products. Physicians arent unique in this regard. None on his list as a group has a good understanding of insurance. Heck many agents dont, possibly even most, at least to the level that i think they should. In medicine there is an inherent trust of fellow physicians in different specialties unless there is good cause not to and i believe many of us make the mistake of thinking that other professions have the same level of commitment and knowledge that many of us do to our profession and thus you should trust their advice. There are repercutions in medicine if you purposefully provide care that isnt in the best interest of the patient...not so much in the financial advisor or insurance business.


When I call someone, I expect them to not want to meet with me. If someone doesn't have knowledge and they don't want to meet with me, I will fight to get the appointment. If someone demonstrates knowledge, like you do, and doesn't want to meet, I am wasting my time in trying to meet. Agents don't want to waste our time or your time. If we know something is going to be a waste of time, we won't do it. When someone just tells us "no", that has no meaning.

The problem with your example is you used disability insurance. I could see a possible benefit of specialization although since there are so few companies worth discussing when it comes to physician disability, im not sure there is much knowledge there to consider it a true specialization but that isnt the real problem. The real problem is that they pretend that have other areas where they have special knowledge like saying permanent insurance is something that physicians should purchase. Many get their foot in the door with disability (which is likely something physicians should purchase) but unfortunately then abuse the relationship by pushing insurance products as an investment which is something most physicians should avoid.


By the way, im talking about people showing up at the office and not just calling.

dhodson said:   The problem with your example is you used disability insurance. I could see a possible benefit of specialization although since there are so few companies worth discussing when it comes to physician disability, im not sure there is much knowledge there to consider it a true specialization but that isnt the real problem. The real problem is that they pretend that have other areas where they have special knowledge like saying permanent insurance is something that physicians should purchase. Many get their foot in the door with disability (which is likely something physicians should purchase) but unfortunately then abuse the relationship by pushing insurance products as an investment which is something most physicians should avoid.


By the way, im talking about people showing up at the office and not just calling.


Like you, I have a problem anytime someone does things in a manner that is not 100% above board and ethical. I can't make any excuses for those people.

For my colleagues, what the specialization did was to give them the ability to sell at a much cheaper price than their competition.

BrodyInsurance said:   Doctors are only financially illiterate to the extent that we are going to call our entire population financially illiterate.Earlier you posted that the NML target market is the "opposite" of trying to sell products to "financially illiterate" people and then mentioned doctors as an example. In other words, the implication of your post is that doctors are a financially sophisticated group, when the reality couldn't be further from the truth.

I do agree that physicians are no more financially illiterate than the rest of the population but this isn't saying much and is a very different statement than the one that you made earlier. Again, physicians tend to present a very lucrative market for these pitches because the vast majority of them just doesn't know better but they have the money to purchase expensive insurance products, which translates into nice commissions for the salespeople.

The pitch, "focuses on physicians and, because of their unique needs, has unique solutions tailored to their needs" may be a pitch, but it was/is also true.For the most part, it's a whole bunch of nonsense. I've been through and have sat through a whole bunch of these pitches (as well as a whole bunch of pitches that target lawyers) and would tell you that while the physicians' circumstances are a little different from those of the rest of the population, there is nothing unique about most of the financial products that they need. Hence, the pitch by "financial advisors" and insurance salesmen that they focus specifically on doctors (particularly when we are talking about attendings and not residents) and have unique solutions tailored to their needs is for the most part marketing, as there is very little, if any, substance behind it.

dhodson said:   The problem with your example is you used disability insurance. I could see a possible benefit of specialization although since there are so few companies worth discussing when it comes to physician disability, im not sure there is much knowledge there to consider it a true specialization but that isnt the real problem. The real problem is that they pretend that have other areas where they have special knowledge like saying permanent insurance is something that physicians should purchase. Many get their foot in the door with disability (which is likely something physicians should purchase) but unfortunately then abuse the relationship by pushing insurance products as an investment which is something most physicians should avoid.


By the way, im talking about people showing up at the office and not just calling.
Precisely, this is the standard tactic: start small, which earns the person's trust, and then expand the relationship by selling them financial products that result in some of the highest commission for the salesperson. Hence, the reason that the first thing that most physicians get pitched on is disability insurance. The very next pitch is almost certainly for permanent life insurance.

Just to clarify, I do agree that permanent life insurance is not a scam (in the Madoff sense) and agree that there are certain people and certain circumstances in which it can make sense. For the VAST majority of the population, however, it is completely counterproductive to people's financial goals.

I know that Brody's standard response to that is along the lines of "who cares that it's not appropriate for most people; I only sell it to those for whom it is appropriate." While this makes sense conceptually, as a practical matter, those of us who are routinely exposed to these pitches know that these products get pushed without any regard for whether they are optimal for the person (and they hardly ever are).

Earlier you posted that the NML target market is the "opposite" of trying to sell products to "financially illiterate" people and then mentioned doctors as an example. In other words, the implication of your post is that doctors are a financially sophisticated group, when the reality couldn't be further from the truth.

I do agree that physicians are no more financially illiterate than the rest of the population but this isn't saying much and is a very different statement than the one that you made earlier. Again, physicians tend to present a very lucrative market for these pitches because the vast majority of them just doesn't know better but they have the money to purchase expensive insurance products, which translates into nice commissions for the salespeople.


Ok, you've got me. Let me make a change to make this more accurate. Their target market is not based upon financial literacy. Their market is based upon people who are financially successful. Not all financially successful people are more financially literate, but as a general rule, those who are financially successful do tend to be more financially literate. For those agents who live in the NYC area, Wall Street is a huge market for them. The point is that these large mutual companies that sell whole life insurance didn't become Fortune 100 companies in size by having an intern sell a $100,000 policy to his drinking buddy. Like many things, the 80/20 rule probably holds true. The top 20% of their agents probably account for 80% of their business. What an intern or a new associate sells doesn't matter.

For the most part, it's a whole bunch of nonsense. I've been through and have sat through a whole bunch of these pitches (as well as a whole bunch of pitches that target lawyers) and would tell you that while the physicians' circumstances are a little different from those of the rest of the population, there is nothing unique about most of the financial products that they need. Hence, the pitch by "financial advisors" and insurance salesmen that they focus specifically on doctors (particularly when we are talking about attendings and not residents) and have unique solutions tailored to their needs is for the most part marketing, as there is very little, if any, substance behind it.

Once we get past the resident stage, I agree with you. It is all marketing.

Precisely, this is the standard tactic: start small, which earns the person's trust, and then expand the relationship by selling them financial products that result in some of the highest commission for the salesperson. Hence, the reason that the first thing that most physicians get pitched on is disability insurance. The very next pitch is almost certainly for permanent life insurance.

Just to clarify, I do agree that permanent life insurance is not a scam (in the Madoff sense) and agree that there are certain people and certain circumstances in which it can make sense. For the VAST majority of the population, however, it is completely counterproductive to people's financial goals.

I know that Brody's standard response to that is along the lines of "who cares that it's not appropriate for most people; I only sell it to those for whom it is appropriate." While this makes sense conceptually, as a practical matter, those of us who are routinely exposed to these pitches know that these products get pushed without any regard for whether they are optimal for the person (and they hardly ever are).


I have a huge problem when they get pushed in an inappropriate manner. I am very aware of this happening. I understand that I was very lucky to be trained by ethical people in an ethical agency and what I experienced is not the same for everybody. One of the problems with seminar selling, for example, is that it's about selling a specific solution without knowing a specific problem that is trying to be solved.

If you are interested, I'll get into it a little bit more about how NML trained their agents and their focus. My info may be a little bit dated. It is just one person's experience in one agency, but this is an agency that did it the way that it was supposed to be done. Did others do it the same way? In general, I think so, but I'm sure that there were exceptions.

BrodyInsurance said:   If you are interested, I'll get into it a little bit more about how NML trained their agents and their focus. My info may be a little bit dated. It is just one person's experience in one agency, but this is an agency that did it the way that it was supposed to be done. Did others do it the same way? In general, I think so, but I'm sure that there were exceptions.I would be interested in hearing about it.

glad you owned up to that...i dont think they target financial illiterates per say. I feel they target the money and the lack of knowledge of these folks is just a benefit to them. They do however make the contract and products so complicated that it would be darn hard for an outsider to realize that the person is not acting in a fiduciary manner. The tactics used never have a little disclosure like hey this likely isnt a good investment. I also disagree about the intern example. It helps them tremendously. Not one policy but in mass there are tons of these policies. A higher than average number lapse and this allows their business model to continue since some of that profit can be given to those who keep the policy in force until death.

In regards to NML (the primary purpose of this thread), they are a strong company financially. With that said almost none of their products should be purchased. Are they likely the best choice for a physician for disability? No way. How about LTCI? Nope. Term life insurance then...very unlikely. Annuities....id give that a toss up. And then the big focus on whole life permanent insurance. Since few need a permanent death benefit then as an investment (even if we pretend that whole life could be a good investment which it isnt), they dont perform well at all once you get to the distribution phase. Looks good on paper until you see the effects of direct recognition and 8% fixed loan rates. Thus while you and many others may have once been well trained by other NML folks to do the right thing and to have a good understanding of the product, the right thing likely isnt happening a good deal of the time especially when you consider they are required to push NML first.

The OP may very well get good training there but thats sort of in comparison to no training.

.i dont think they target financial illiterates per say. I feel they target the money and the lack of knowledge of these folks is just a benefit to them.

I would be surprised if the 80/20 rule doesn't hold true for NML. That would mean that 20% of their sales account for 80% of their profit. I would be willing to bet that the overwhelming majority of the sales to that 20% involve financially sophisticated individuals. It's not unsophisticated individuals who spend $100,000+ on life insurance premiums. I know that whenever I am involved in a big sale, their attorney is always involved and there is often an accountant involved.

My experience has been that it is easy to sell to someone with almost no financial knowledge. It is also easy to sell to someone with lots of financial knowledge. The near impossible sale of permanent insurance is to the person with a little to medium amount of knowledge.

They do however make the contract and products so complicated that it would be darn hard for an outsider to realize that the person is not acting in a fiduciary manner.

I think that the fiduciary thing doesn't mean anything. An honest person is honest. A dishonest person is dishonest.
A product with a guaranteed death benefit, guaranteed premium, and guaranteed cash surrender value doesn't sound very complicated to me. If a person takes their dividends in cash, the policy will ALWAYS perform EXACTLY as is guaranteed.

The tactics used never have a little disclosure like hey this likely isnt a good investment. I also disagree about the intern example. It helps them tremendously. Not one policy but in mass there are tons of these policies. A higher than average number lapse and this allows their business model to continue since some of that profit can be given to those who keep the policy in force until death.

You're guessing...and you are guessing wrong. In total, not only don't they make a lot of profit from their interns, I'm not even sure if they make any. In any given year, I would bet that there are less than 5 agencies in the entire country where the interns accounted for more than 1% of the sales.

Insurance companies need lapses, but high lapses in the early years hurts the company and does not help them. Inappropriate sales tend to result in lapses during the early years and not later years. It is fairly common for the top NML agents (and other big mutuals also) to have persistency ratios from year to year that are close to 100%.

In regards to NML (the primary purpose of this thread), they are a strong company financially. With that said almost none of their products should be purchased. Are they likely the best choice for a physician for disability? No way. How about LTCI? Nope. Term life insurance then...very unlikely. Annuities....id give that a toss up. And then the big focus on whole life permanent insurance. Since few need a permanent death benefit then as an investment (even if we pretend that whole life could be a good investment which it isnt), they dont perform well at all once you get to the distribution phase. Looks good on paper until you see the effects of direct recognition and 8% fixed loan rates. Thus while you and many others may have once been well trained by other NML folks to do the right thing and to have a good understanding of the product, the right thing likely isnt happening a good deal of the time especially when you consider they are required to push NML first.

I agree that they tend to not be the best choice for disability. I actually don't know how their contract stands up for physicians. It definitely isn't as good for occupations like attorney and CPA.

What's wrong with their LTCI? They are one of the few companies that I wouldn't expect to ever raise rates on existing clients and they were paying dividends to their policyholders. I don't know if they currently are paying dividends.

Their agents and their clients find whole life to be appropriate much more than you think that it's appropriate. Here's a newsflash for you. Your opinion, is just that, an opinion. When you don't think that it's appropriate, you shouldn't buy it. When someone else finds it to be appropriate, they should buy it.

Pushing one company is always a problem.

The OP may very well get good training there but thats sort of in comparison to no training.

It's truly dependent upon the agency and what sort of mentoring the person receives. As I previously said, nobody should take a job at any of the big mutual companies without exploring the other ones.

geo123 said:   BrodyInsurance said:   If you are interested, I'll get into it a little bit more about how NML trained their agents and their focus. My info may be a little bit dated. It is just one person's experience in one agency, but this is an agency that did it the way that it was supposed to be done. Did others do it the same way? In general, I think so, but I'm sure that there were exceptions.I would be interested in hearing about it.

My experience is from close to 20 years ago, but I know that it was still true less than 10 years ago. I don't know if it is still accurate.

NML followed the Granum system. Take the time and read this article. http://www.lifehealthpro.com/2009/05/06/the-keen-insight-of-al-g...

This guy was the guru. We all followed what he taught. Virtually none of it had anything to do with trying to sell whole life insurance. It was all about 10-3-1. 10 prospects would equal 3 fact finders which would equal 1 sale. The type of sale was irrelevant. The commission was irrelevant. One big sale from an experienced agent was going to amount to more commissions than would be made by all of the recruits combined. Management needed agents who could succeed and become big producers as opposed to newbys who would sell more.

Take 4 hypothetical new agents in their 4th month in the business.
Agent 1: Sold a big policy and made $7,000, and kept 10 appointments for the month and got 5 referrals.
Agent 2: Sold 3 policies and made $2000, but kept 60 appointments for the month and got 100 referrals.
Agent 3: Sold 5 policies and made $1000, and kept 60 appointments for the month and got 100 referrals.
Agent 4: Sold 0 policies and made $0, and kept 80 appointments for the month and got 130 referrals.

Let's rank these agents from best to worst.
Agent 4
Agent 3
Agent 2
Agent 1

Why?
Agent 4 is working the hardest. If he can keep up this sort of activity, he will make an absolute killing once he learns how to sell.
Agent 3 beats Agent 2 even though Agent 2 made more money. Lives (sales) are more important than commission dollars. More lives will ultimately result in more commissions.
Agent 1 has done the worst. His one sale might be luck or it might be that he's a great salesman. Either way, almost nobody succeeds without high activity.

So, what they try to do with the rookies in the beginning is to focus strictly on activity. They want them to get 100 activity points a month. It is something like 1 pt for each fact finder, 1 for each case open, 1 for each close, and 1/2 for each referral. For awhile all that they care about is activity points. Sales really don't matter. Once someone consistently has the activity, they start caring about the sales (lives). However, by sales, I can't stress enough that it is not about commissions. It is about the number of lives sales. The basic progression is 100 pts a month will lead to 100 lives a year. 100 lives will lead to $100,000 of premium. $100,000 of premium will lead to $100,000 of commission.

Never, ever, ever, was it about selling a specific product. It was about seeing people and doing the right thing for them. I think that it took me 6 months to make my first sale. Nobody gave me a hard time about it because I was making the effort. At the same time, the top producing new guy got canned because of a lack of activity.

By the way, NML does have incredibly strong Kool-Aid. Although product pushing isn't something that we did, NML pushing was something that we did. It was drilled into our heads what an incredible company NML was and how everybody should buy their coverage from them. (I agree with the first part while disagreeing with the second part.) How strong is their Kool-Aid? At other companies, the company pays to send you on trips. At NML, the agents willingly pay their own way to go to Milwaukee in the summer.

You have no idea what percent new agents make up in sales either. You are also guessing. You have no stats to back that up and i wasnt limiting to just interns but relatively new agents or agents who wont be career agents. Its a pyramid system and the only way to advance up the pyramid is to sell a bunch of products many of which are simply not going to be appropriate.

News Flash...Permanent insurance is almost never appropriate but its pushed. It isnt easy at all to sell to someone whole life as an investment if that person understands this product. They wont buy it. That isnt really an opinion. Its been around 200 years but not one independent study shows it as a good investment. That isnt by chance. News Flash...permanent insurance has zero independent evidence behind it as a good investment. We've already gone down the road that these people arent knowledgeable on the product. Dont try and pretend your clients understand the product. They dont. They may have faith in you but they dont understand the product. For big sales you have an attorney and accountant present for your assistance. It isnt to help the client but to pretend that their presence means more than it does. Those folks also dont understand the product. I know that from personal experience. They are mostly hoping to get referals.

With LTCi, i sure hope they dont raise rates since a ton of rate increases are already built into the price. If you dont mind prepaying for the rate increase then i guess its great.

dhodson said:   You have no idea what percent new agents make up in sales either. You are also guessing. You have no stats to back that up and i wasnt limiting to just interns but relatively new agents or agents who wont be career agents. Its a pyramid system and the only way to advance up the pyramid is to sell a bunch of products many of which are simply not going to be appropriate.

News Flash...Permanent insurance is almost never appropriate but its pushed. It isnt easy at all to sell to someone whole life as an investment if that person understands this product. They wont buy it. That isnt really an opinion. Its been around 200 years but not one independent study shows it as a good investment. That isnt by chance. News Flash...permanent insurance has zero independent evidence behind it as a good investment. We've already gone down the road that these people arent knowledgeable on the product. Dont try and pretend your clients understand the product. They dont. They may have faith in you but they dont understand the product. For big sales you have an attorney and accountant present for your assistance. It isnt to help the client but to pretend that their presence means more than it does. Those folks also dont understand the product. I know that from personal experience. They are mostly hoping to get referals.

With LTCi, i sure hope they dont raise rates since a ton of rate increases are already built into the price. If you dont mind prepaying for the rate increase then i guess its great.


One of us is in the business and one of us is making guesses based upon a personal bad experience. I have enough experience and have seen enough stats to know that I'm correct. In no way, shape, or form is it a pyramid system. There is no pyramid to climb.

Permanent insurance isn't an investment. A permanent death benefit has value. You believe that the value isn't worth the money. Many people disagree with you. You are a doctor, therefore, sterotypically, your opinion has more weight than others. If others disagree with you, obviously, they must be wrong.

It isn't about me

Please link one independent study showing the value as an investment

I just ask for one

BrodyInsurance said:   I know that whenever I am involved in a big sale, their attorney is always involved and there is often an accountant involved.Sure, and while I don't think you meant it this way, this is something that gets brought up a lot by all the insurance salesmen, who always point out that some of the most wealthy people in the country own substantial permanent life insurance policies. So, the implication is, if those people with all their advisors, lawyers and accountants feel that permanent life insurance is a a worthwhile product for them, how can you possibly argue against it.

In reality, the reasons that those people purchase permanent life insurance are completely inapplicable to the "mere mortals." For most of them, the focus is on asset preservation rather than asset growth, which is very different from the rest of the population. For most of them, the focus is on avoiding/minimizing estate taxes, which is something that the majority of the population does not need to worry about. The list of these differences goes on and on.

Please link one post where I said that it is an investment. Don't like it? Don't buy it.

I've also been very clear when I call it a bad investment

geo123 said:   BrodyInsurance said:   I know that whenever I am involved in a big sale, their attorney is always involved and there is often an accountant involved.Sure, and while I don't think you meant it this way, this is something that gets brought up a lot by all the insurance salesmen, who always point out that some of the most wealthy people in the country own substantial permanent life insurance policies. So, the implication is, if those people with all their advisors, lawyers and accountants feel that permanent life insurance is a a worthwhile product for them, how can you possibly argue against it.

In reality, the reasons that those people purchase permanent life insurance are completed inapplicable to the "mere mortals." For most of them, the focus is on asset preservation rather than asset growth, which is very different from the rest of the population. For most of them, the focus is on avoiding/minimizing estate taxes, which is something that the majority of the population does not need to worry about. The list of these differences goes on and on.


To me, the implication is not one that says, "if they do it, you should do it". For me, it goes to my point that these products are not good or bad. They are appropriate or inappropriate.

I tend to get attorneys involved in the majority of my insurance sales regardless of whether it is permanent, term, or some combination. Estate taxes are no longer something that just the wealthy have worry about. "Jim" is a divorced CPA with an income of $130,000. He has $300,000 of equity in his house, $400,000 in investments and $1,500,000 of life insurance. He sure isn't going to meet anybody's definition of wealthy. Without proper planning, state estate taxes in the state of MD would be close to $200,000.

BrodyInsurance said:   geo123 said:   BrodyInsurance said:   I know that whenever I am involved in a big sale, their attorney is always involved and there is often an accountant involved.Sure, and while I don't think you meant it this way, this is something that gets brought up a lot by all the insurance salesmen, who always point out that some of the most wealthy people in the country own substantial permanent life insurance policies. So, the implication is, if those people with all their advisors, lawyers and accountants feel that permanent life insurance is a a worthwhile product for them, how can you possibly argue against it.

In reality, the reasons that those people purchase permanent life insurance are completed inapplicable to the "mere mortals." For most of them, the focus is on asset preservation rather than asset growth, which is very different from the rest of the population. For most of them, the focus is on avoiding/minimizing estate taxes, which is something that the majority of the population does not need to worry about. The list of these differences goes on and on.


To me, the implication is not one that says, "if they do it, you should do it". For me, it goes to my point that these products are not good or bad. They are inappropriate or inappropriate.

I tend to get attorneys involved in the majority of my insurance sales regardless of whether it is permanent, term, or some combination. Estate taxes are no longer something that just the wealthy have worry about. "Jim" is a divorced CPA with an income of $130,000. He has $300,000 of equity in his house, $400,000 in investments and $1,500,000 of life insurance. He sure isn't going to meet anybody's definition of wealthy. Without proper planning, state estate taxes in the state of MD would be close to $200,000.



I love the slip

Since it's all about expanding your referral network, is it unethical or illegal to give a commission to someone for their referrals that buy from you? So if you have 10 drinking buddies and while you don't necessarily target them as a client, can you offer them 20% of the commission from F&F that they refer? And if those referrals have F&F that they can refer, you also offer them a 20% commission.

anthonyu said:   Since it's all about expanding your referral network, is it unethical or illegal to give a commission to someone for their referrals that buy from you? So if you have 10 drinking buddies and while you don't necessarily target them as a client, can you offer them 20% of the commission from F&F that they refer? And if those referrals have F&F that they can refer, you also offer them a 20% commission.

It is illegal if they are not insurance licensed. It is unethical if it isn't disclosed to the clients. It is also just plain stupid when the alternative is to learn how to get the referrals without having to give up a penny.

A few friends of friends did the NM thing... was so annoying to get sales calls on my cell phone from people I met drunk at a party once, acting like my best friend and trying to sell me crap they didn't even understand. If you do go to that firm please don't be this obnoxious.

bigM

ps-they all failed out in 9-12 months and are working crap jobs now.

edit: I totally forgot I actually interviewed there when I was finishing college. The recruiter was pretty creepy, calling me long after I declined to work there to ask how I was doing in my job, etc...

bigmarley4 said:   A few friends of friends did the NM thing... was so annoying to get sales calls on my cell phone from people I met drunk at a party once, acting like my best friend and trying to sell me crap they didn't even understand. If you do go to that firm please don't be this obnoxious.

bigM

ps-they all failed out in 9-12 months and are working crap jobs now.

edit: I totally forgot I actually interviewed there when I was finishing college. The recruiter was pretty creepy, calling me long after I declined to work there to ask how I was doing in my job, etc...


Our first thought when someone calls us is, "Why is this person calling me?" This is true even when it is a good friend. Guys almost never call just to chat. That is why it bothers us when some salesman calls and starts chit chatting. For that reason, I firmly believe that the first words of the conversation to friends and acquaintances need to be, "This is a business call." Non-business calls should never be turned into business calls.

bigM, am I correct that although you, like most people don't like to be called, the bigger problem was that you got contacted in an unprofessional manner?



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