Capabilities

Insurance Audits

Life insurance is complex. The typical consumer is often ill-equipped to deal with the many intangible elements of life insurance at the time of purchase, let alone the impact of changes to those elements over the life of a policy. Furthermore, insured’s insurance needs change, new products continue to be introduced and the whole concept of life insurance becomes even more confusing. A proper Life Insurance Audit simplifies the confusion.

A life insurance audit is a thorough, unbiased written description and assessment of an insured and/or policy owner’s existing life insurance portfolio conducted for the purposes of determining if the portfolio meets their intent, needs, objectives and risk tolerance. Insurance audits measure expected policy costs and performance based on reasonable assumptions and compares them to the expected cost and performance of other competitive products in the marketplace.

SMB’s typical insurance audit is fee-based, takes 4-6 weeks to complete and includes a 10 point inspection:

  1. Needs assessment relative to the client objectives.
  2. Detailed policy summary including a review of policy ownership and product type.
  3. In-force re-projections of future cash values and death benefits based on results to-date compared to original expectations.
  4. Evaluation of the underwriting class based on current medical information (provided by the insured) and assessment of possible rate class improvements for existing policies.
  5. Evaluation of policy charges and assumptions and their impact on performance.
  6. Evaluation of the insurance company’s current financial ratings and outlook.
  7. Recommendations to bring current policies in line with initial expectations.
  8. Evaluation of premium funding strategies, including third-party financing.
  9. Restructuring strategies such as consolidations, 1035 (tax free) exchanges, face amount decreases, or sale of policy to third party (when coverage is no longer needed).
  10. Survey of current insurance products in the marketplace to determine comparative pricing.

The result is an understandable and objective oriented insurance evaluation.