 |
Engagement Agreement |
| |
A written
agreement is required under Michigan's Life Insurance Counselor's
license. This agreement clearly identifies Katt & Company's responsibilities
with an estimate as to the amount of time it will take. |
|
Data Collection and Assessent |
| |
The
first planning step is to obtain pertinent financial and family information
from the client. This is a crucial step as it allows the client to
establish his or her life insurance related goals. |
|
Preliminary Life Insurance Planning and Purchase
Report |
| |
After obtaining financial
and family information, a preliminary planning and purchase report
is prepared. This report identifies a reasonable range of planning
and purchase options. After studying and discussing this preliminary
report, the client selects the planning and purchase options believed
to be in his or her best interests. |
|
Supplemental Reports (as needed) |
| |
Supplemental reports are
prepared whenever clients need additional information to make informed
decisions. Examples of supplemental reports include a simulated comparison
of variable and universal (or whole) life; and a comparison of projected
values based on whether the policy's values grow inside or outside
of the client's estate. Again, decisions that have been made and time
expended are written in case management memos. |
|
Existing Life Insurance Report |
| |
Concurrent with the reports
described above, Katt & Company reviews, evaluates, and comments on
life insurance the client already has. These reviews are usually completed
about the time the final decisions on overall life insurance program
are made so that the existing life insurance can be melded into the
new program.
Recommending the replacement of existing policies
is a rare event. Replacement is recommended only when the existing
policy appears to e substantially overpriced, the financial strength
ratings of the company are below average, or the policy setup is
a problem and there is no prudent way to change policy ownership
of beneficiary without causing potentially adverse tax consequences.
|
|
Company Policy Selection Report |
| |
Katt & Company uses three
criteria in recommending a specific company and policy: the financial
strength ratings; the reputation the company has for fair policyholder
treatment based on our experience and judgment; and legitimate pricing
advantages, such as low-load and blending full-load policies to reduce
selling expenses. In large cases two or more companies are frequently
recommended to provide diversification. |
|
Purchase Report |
| |
When
the specific policy(ies) has been selected, the client is presented
with a purchase report. This report identifies and explains pertinent
information and purchase decisions that need to be made. Examples
include an overview of the policy riders that are available, how future
changes in the investment yield might affect a policy's performance,
and selecting target premiums. |
|
Case Management Memos |
| |
These memos continue throughout
the case. They are intended to keep the client informed about decisions
already made, work to be done, and time expended and expected. |
|
Application Completion |
| |
When clients purchase new
insurance, Katt & Company makes sure that the owner and beneficiary
are correct and that such items as 1035 forms are properly handled.
|
|
Policy Reviews |
| |
Once a case is completed,
the clients' life insurance program is reviewed on a regular basis
as approved by the client. |
