3 Types of Insurance Carrier Rating Systems

You’re ready to purchase life insurance, but you just realized that you know next to nothing about the financial strength of the companies you’re about to buy from. That’s a problem. Sure, there are state guaranty associations, but these state-run insurance funds only cover a fraction of your policy, up to $100,000, or in some cases up to $300,000. You want to be certain you’re making the right decision. Here’s how to do that.

The Rating Agencies

Typical rating agencies include A.M. Best, Moody’s, Fitch, and Standard and Poor’s. While these rating agencies do provide ratings for pretty much every financial institution, there’s a problem with the way the ratings are done. First of all, the rating agencies can be influenced by insurers. That’s right, insurance companies can pay rating agencies to rate them.

When you’re looking for a life insurance company to provide you and your family with a lifetime of insurance benefits, the last thing you want is the rating to be tainted by paid ratings. Even if you give insurers the benefit of the doubt, there’s little reason, other than manipulation, to pay for a rating. If the company is solid, a rating agency will rate the insurer as such. Read More

Four Takeaways to Tackle the California Insurance Licensing Exam

Since November 2012 the California Department of Insurance (CDI) has required that California residents looking to applying for licensing must first pass the license examination before submitting an application. PSI Services is the testing vendor that the CDI uses to administer state-based regulatory licensure exams.

For anyone looking to obtain their California insurance license, you will have to take the California Insurance Exam. The number of questions and time given for the exam depend on the type of insurance that you want to specialize in. However, there are many resources available to ensure that you are at your peak performance when your test day arrives. Below are four tips to use in order to prepare yourself.

1. Talk to Licensed Agents

Before sitting for your exam, talk to licensed agents who have already taken the test. Talk to them about what to expect, and what the atmosphere is like in the room. Simply just knowing what your surroundings will be like once you’re in the test center can keep you from being nervous or distracted. Read More

Understanding High Risk Life Insurance


As the saying goes, “Knowledge is power.”  When it comes to life insurance, the more knowledge and experience you have, the better you will be able to serve your potential clients and gain an edge over the competition.  Many agents shy away from high risk life insurance simply because they don’t have the knowledge to properly serve the client.  In this blog post I’ll be discussing what high risk life insurance is, what options your clients might have and I’ll be giving you some tips so that you can carve out a niche for yourself and be successful placing high risk life insurance cases.

What is High Risk Life Insurance

Life insurance companies typically have 4 main health ratings – ranging from Preferred Plus, Preferred, Standard Plus to Standard. Factors such as height/weight, cholesterol, blood pressure and family history of heart disease or cancer are just a few of the components that determine which health rating applicants could receive.  The better the health rating, the better the price for life insurance.

High risk life insurance, also known as impaired risk, refers to cases where an individual would not qualify for regular life insurance, even for a standard health rating.  Typically, this category of life insurance is reserved if a person has a pre-existing condition.  It could be something less serious, such as diabetes, or something more serious like heart disease. Read More

Selling Insurance in the 21st Century

What can you expect as a new insurance agent?

So you’ve decided to take the plunge into the world of insurance.  Nice work.  You now have one of the most challenging, frustrating, but at the same time rewarding career opportunities in front of you.  And the timing couldn’t be better.

Whether you plan to sell life insurance, health insurance or all of the above, major legislative changes are leaving clients confused and many of them will turn to you with questions.  By becoming an insurance agent, you are joining an elite group of advisors who will be on the front lines when it comes to helping clients navigate their insurance choices, be it health, life or retirement planning.  Are you ready?

When I sit down with newly licensed insurance agents or people thinking about getting into the business, I don’t sugarcoat anything.  I tell them exactly what they can expect.  But what I also tell them is that with the right approach to helping your clients, and the right motivation, you’ll find your career in the insurance industry to be one of the most gratifying decisions you’ll ever make. Read More

The Importance of Life Insurance

When planning for the future, there is perhaps no single product more important than life insurance. Whether it’s to cover current debts and liabilities, or to provide surviving loved ones with a source of supplemental income, life insurance is a source of sanity and fiscal stability that helps millions of families stay afloat each year after a loved one has unexpectedly passed away.

Estate Taxes and Planning: When Life Insurance Becomes Essential

The usefulness of life insurance doesn’t become obvious to many people until they begin to plan their estate and they learn about the potential taxes, expenses, and fees that will be incurred by their spouse, children, and others, after they have passed away. Life insurance helps to offset or eliminate those costs by using its payout to the beneficiary as a main source of income and inheritance. The amount of the benefit paid out to the life insurance beneficiary can help offset estate planning fees, asset distribution fees, and more. Read More

Determining Penalties for Employers Not Offering Affordable Health Insurance Coverage in 2014

The employer mandate provision of the Patient Protection and Affordable Care Act will begin in 2014. The mandate states that a business with 50 or more full-time employees or full-time equivalents may face penalties if the health insurance coverage that is offered to its employees does not meet minimum standards outlined in the Act.

Below is a flow chart that will help to clarify what requirements an employer must follow in offering affordable health insurance coverage to their employees in order to prevent from a penalty. Read More

Quick Tips for Insurance Exam Day


The day has arrived to take your state insurance exam.  You’ve memorized all the facts and figures.  You have a thorough understanding of the material and how concepts relate to one another.  You are finally able to distinguish aleatory from adhesion!  This is great, but you feel a little anxious about what to expect and you want to make sure you’re ready.

To help remove any apprehension you may have towards your insurance exam, we have compiled a few helpful tips!

Arrive early

Get to the testing center at least 30 to 45 minutes before the scheduled time of your insurance exam.  Arriving early is important because it allows you time to locate the facility and not feel tense going into the exam.  It gives you time to relax and clear your mind.  Being relaxed is crucial to your success on the exam. Read More

3 Licensing Compliance Companies You Should Know

The insurance industry is highly regulated by both the state and federal government, requiring agents and agencies to maintain licensing compliance in each state they solicit and sell insurance.  In addition to maintaining your book of business, your responsibilities as a licensed agent also include maintaining your resident and non-resident state licenses, appointments with carriers in each state you solicit insurance products and annual or biennial continuing education requirements required by your home state.  To further complicate the issue,  if you hold an insurance license in multiple states or you sell more than one line of insurance, the maintenance of your various state licenses is compounded.

For example, if you hold a resident license in Texas and want to maintain your Indiana non-resident license, you must renew it every two years on the last day of the license issue month and pay a fee in an amount of $90.  However, if you hold a resident license in Illinois, for example, and want to maintain your Indiana non-resident license, your renewal fee would cost $250 since the Indiana Department of Insurance imposes a retaliatory fee, in addition to its renewal fee.  And, in the event you forget to renew your license on time and need to reinstate it, you will be required to pay a reinstatement fee of $270 in addition to your renewal fee.  Of course, this reinstatement fee is also increased in those states where retaliatory fees are imposed!

Sounds confusing, right? Read More

Top 5 Benefits for Completing Your Insurance Course Online


In preparing for your state insurance exam, the three most common study options include traditional classroom courses, insurance study manuals, and online insurance courses.  One style of learning does not fit everyone, so let’s review what is included with each option.

Traditional classroom courses usually consist of an instructor verbally explaining insurance concepts from a manual or syllabus which may include a few visual aids to reinforce the material.  Although an instructor usually has a good understanding of the material, his or her explanations may not always be concise, consistent and clear every time it is presented.  In addition, since not every state requires the completion of a pre-licensing course before taking the state insurance exam, an instructor may or may not be certified by his or her Department of Insurance, depending on the state’s requirement.

Preparing for the state exam with only the use of a study manual often includes text, illustrations and exam questions.  While the explanation of insurance concepts from a study manual may be consistent and clear, it may not always be up-to-date and it loses the interactive learning process associated with a classroom.

Online insurance courses take a multimedia approach by combining the interaction of a traditional classroom with the clarity and consistency of a textbook, while including some important additional benefits. Read More

What to do if You Fail the Insurance Exam

At the time I took the state exam for my life and health insurance license, I was the licensing director at a large, nationwide agency.  Every week we would enroll new employees in a local insurance school and then register them to take the state insurance exam.  With every group that attempted the exam, I quickly began to notice a trend: around half of the individuals who sat for the exam, failed.

I decided that I would tutor anybody that did not feel comfortable with the material and that needed addition help.  I ended up assisting hundreds of new employees pass their exam and saw the percentage of failed attempts decline.  It was great helping new friends and associates get over that final hurdle, and attain their insurance license.  Then, I was advised by upper management that I must obtain my license as well.

I completed the insurance class and diligently studied every day for two weeks.  This is on top of already having a firm grasp of the information as a result of helping so many others prepare.  As I hit the submit button at the end of my state exam, I had only one thought enter my mind:

I have no idea if I passed this exam

Read More