The Best of Both Worlds in a TermPerm Blend

For the majority of families, life insurance needs will change over time. Typically, more coverage is required while your client’s family is still young and building their wealth, with a decreasing amount required as the family finances mature.

Most life insurance policies are designed to provide a level amount of coverage for the lifetime of the policy, making it challenging to fund the policy on an ongoing basis. However, if you’re considering the best overall solution for your client, the decision between term versus permanent insurance doesn’t have to be an either/or situation – your client can have both!

Oftentimes, the best insurance protection can come from a Term/Perm combination – that is, a small amount of permanent insurance, PLUS a term rider to cover the remaining amount, or two stand along policies. With this Term/Perm blend, you can ensure that your client’s coverage is tailored to their lifestyle over time and fits their initial budget. Your client gets an ample amount of coverage in the initial years of their policy, while knowing they have some amount of coverage for the duration of their life, providing them with maximum flexibility.

So, what are some of the benefits of recommending a small base plan of permanent insurance coverage to your client?

  • Coverage that is aligned to their fluctuating needs over time
  • Potential for a lower total cost over time
  • At renewal for the term rider portion or separate policy, the client has options to renew, convert, reduce, drop and/or add other coverages – options are important!
  • Lock in permanent rates TODAY to guarantee the cost of the permanent coverage for life

The possibility of some plans to build cash values to support “premium vacations”. The fact is that the earlier in life that a client purchases permanent coverage, the greater the impact it can have as a financial instrument in their overall financial plan.

PPI’s here to help. Our Toolkit Direct has two applets that can assist you in this process:

  • Insurance Needs Analysis (INA): identify and explain the difference between Temporary and Permanent Needs
  • Life Insurance Funding Options: offer your client four options – term only, permanent only, some permanent with the remainder as a term rider, or both term and permanent stand alone policies (the Term/Perm blend)

Start the conversation with your clients today to set them up for success into the future.

For similar content on term versus permanent insurance, share Exploring Your Life Insurance Options, The Ultimate Planning Tool, INFOclip: Understanding Term Insurance and Choosing Insurance That Grows with You.

And if you have any questions about the Term/Perm blend of insurance or how to position it to your clients, contact your local PPI Collaboration Centre.

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The Best of Both Worlds: Term and Perm Insurance