Selling life insurance was one way that ex-jocks earned a living back in the late 60s early 70s. That was before huge mega-million dollar contracts. I knew two of them, Gil Mains, defensive lineman for the Lions and pitcher Dick ‘The Monster’ Raditz. I don’t know how well they did selling insurance but they had name recognition in the Detroit area, knew lots of people and did not appear to be missing any meals when I knew them.
Times have changed and I read that Gene Simmons, of the rock band Kiss, is the newly appointed rainmaker for a recently created insurance marketing firm that is aiming to sell jumbo life insurance policies to really rich people. Gene, with his kids and ex-Playboy magazine centerfold wife, has his own cable reality show, endorses everything from condoms to caskets, and is one of those unique guys who is able to entertain and run a business. What he knows about life insurance is probably zip but Gene knows a lot of people and for that he was asked to be point-man for the new insurance agency aiming to sell jumbo policies to rich folk.
Simmons is hooking up with Cool Springs Life Equity which is somewhere in Nashville, not exactly your city known as an epicenter for rock or movie swells.
Cool Springs is also offering to finance the insurance policies in order that the ultra-rich don’t have to reach into their pocket and pay those nasty life insurance premiums. The loan will eventually be paid back through the life insurance assets while living or at death by attachment to the death benefit.
It’s an old story and the rich are not anymore immune from it than Joe and Mary Next Door Neighbor. No one objects to owning lots of life insurance - it’s paying for it that is the deal breaker. Smart insurance brokers have gotten rich exploiting that very fact.
According to Simmons the insurance policies will be bought ‘direct’ so that their costs are low. Since Simmons is just getting his feet wet the WSJ article doesn’t explain what exactly this ‘buying-direct’ means; is the insurance a low-load life or no-load or just a regular jumbo policy with some cash value build-up in the first year? We won’t know and chances are Simmons doesn’t either, nor does he care. His deal is to talk the talk. He mentioned he is going in a few weeks to a ritzy party in Miami and inferred he is going specifically to talk insurance to whomever he meets while hovering over the potted shrimp.
Simmons isn’t the first nor will he be the last celebrity to tout life insurance. Ed McMahon was an insurance shill for years and Alex Trebek is a paid spokesperson for a 1-800 insurer.
Why buying insurance from a Simmons or McMahon or any other celebrity is better for the consumer or makes more sense is beyond me. I guess we think of them as experts in all fields even though a good percentage of the celebrity glitteria have a tough time figuring up from down or counting to three.
Buying insurance through celebrity spokes-folk is not exactly the most sensible way of doing it. There is a lot that someone has to consider before forking over the dough-rey-me, even if you are rich.
There are insurance companies a bit on the iffy side of the financial ledger, which is to say they are in a not exactly in the best of financial shape. Right now I know of one company trying to buy as much business as it can. That’s why financials are so important to look at before you buy. You have to ask: Will the insurance company be around to pay future claims? Does it have a consistent conservative management that doesn’t take extraordinary risks with client’s premiums?
One way you can do your homework is going on line and researching an AM Best life insurance report. It is free, easy enough to read and they cover every type of insurance company from casualty to health.
And that is the rub. The rich don’t know if Simmons is fronting for an insurance company fraught with poor management and fragile assets or not. But , the rich, like you and I don’t think of those things because – it’s Gene Simmons, for crying out loud!
Potted shrimp anyone?
If you have questions about this blog call Paul @ 877 783 7080 or write pstanley@westminsterfinancial.com Share this blog with someone who cares about their money.
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