Shift Gears to Fee-Only Planning with Minimal Challenge

2 min read
December 08, 2016



So you want to be an XYPN fee-only financial planner but you got your start in the commissioned world. Now you’re wondering how to get out from under (transfer) those insurance policies or annuities that you wrote in your former life. Depending on where you were, there are some different avenues.

Big Mutual

Many of these companies work under a “career agency” system. Generally, the agents will use their company exclusively when recommending policies, and over the years use for almost all their clients.

  1. If you want to leave, Big Mutual may be able to do a “blanket reassignment” – the simplest way – if the transfer is to another agent at the same agency. Let’s say while you were working in the Walla Walla Washington agency, you sat next to Fred and liked him. It may be a simple transfer of your existing policies to Fred to service those policies.
  2. If you want the policies you wrote to be serviced by another agent at a different agency, Big Mutual will likely require agent change letters from each client agreeing to the transfer to the new agent/agency. The new agent may have to be appointed with Big Mutual.
  3. If you can’t decide on a reassignment plan, when the agency terminates your contract, the clients would become orphans and are usually reassigned to another career agent.

So what you want to do may depend on two factors. First, if you are continuing a relationship with the clients. Secondly, just how many policies you have with Big Mutual.

Independent Life

Whether you recognize Snoopy, the humpback whale splashing out of the water, or remember to “get a piece of the Rock”, agents are independently licensed and are able to work with many companies.

From my research, blanket transfers are less likely to happen, so transferring policies would require a change of writing agent letter/form for each policy. Similar to #2 above.

If you terminate your contract with Independent Life, as the writing agent you are still vested in compensation, but would not have access to policy info or service the policy going forward.

So most of the time, only individual client letters are the option to change the writing agent.

There are many ways to skin a cat, and I’m a dog person, so we’re here to help!



About the Author: Mark is the president and CEO of Low Load Insurance Services, or LLIS. Low Load Insurance Services was founded to provide assistance to fee-only advisors with helping their clients with insurance transactions. You can learn more about LLIS here

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