Annual Policy Review: Three Key Points to Bring Up and Discuss With Your Agent

Policy reviews are a natural part of a long-term business relationship between clients and financial advisors. The advisor often leads the agenda, as it is their profession. This may lead to you not getting answers to some of your queries.

Not sure where to start? What to say? Here are three key points to bring up and discuss when having a policy review with your agent.

Disclaimer: Your agent is a person too.

Look at them through the lens of this crucial point: Your agent may look to upsell you. They are not malicious or looking to churn out extra commissions out of greed for themselves, but they are working professionals who need to make a living just like you!

If you are a businessman or businesswoman, you know that time is precious. So they likely made the trip out to meet you, firstly, because you are a paying client and they value your business, but secondly, because they see the potential for new business and, therefore, new income for themselves. 

Keep an open mind, and if you do not need to purchase anything new, then say so openly. The vast majority of agents will be thoroughly professional and respect this and not push any further, especially if the two of you have established a professional relationship.

Are there 2nd-year-milestones to take note of in your policy?

Scenario: Your policy has had its “1st policy anniversary” and is now in its second year. 

For some life coverage plans, this means it now starts to accumulate a cash value that will be paid out should you surrender the policy. For some policies, it may mean that you are allowed to make amendments to your premium amount for no additional cost, or in some rare cases, for ILPs, it may even mean the end of the lock-in period on your investment account. 

If you are feeling unsure if any of these apply to you, don’t panic. While it helps to remember these for yourself, it’s not your responsibility. It is your agent’s. There are likely none if they do not bring up any policy milestones for the second year. However, if it will help to put your mind at ease, ask the simple question:

“Are there any milestones the policy has hit now? Anything I need to know?”

2. Are there any changes in your requirements in the past year?

Don’t get us wrong, a policy and its definitions will be ironclad once it is signed by you and accepted by the insurance company. This is regardless of any subsequent changes to the policy conditions for following customers in the period after purchase. 

But one thing that has undoubtedly changed in some regard is you yourself. Perhaps you have had a pay raise in the past year, so your income protection requirements to hedge against disability have increased. Maybe you and your partner now have a child on the way and need to increase your death coverage to provide for this new life should something happen to you. Whatever the changes may be, if any, discuss these openly with your agent concerning the changing viability of your insurance policy. Frame in this way:

“In the past year, I’ve just (significant milestone/change in situation). Would you say this policy is still okay as it is? Any suggestions?”

There is a chance of no significant lifestyle changes or milestones over the past year, yet, you feel a need to alter your life coverage for your own reasons. 

3. Are there any general changes that affect me directly?

This is vital. Are there any changes to conditions for making an insurance claim? Do they affect all policyholders? Are there any government regulatory changes that make it harder for me to access my policy payouts? 

The reality is that any regulatory changes impacting financial advisors will be mentioned in email bulletins, brought up in monthly town hall meetings, plastered in bright colours on their office walls, you name it. 

Financial advisors will know about any changes impacting existing clients, or at the very least, have them accessible and on hand when meeting clients. There is a universal reason for this that extends beyond providing good service. There is nothing more embarrassing for a professional in a particular field than having someone outside their area ask them a question that they should know the answer to but do not. If you asked your agent about the recent government announcement that affects them, and you know more about it than they do, it’s a bad look.

For this reason, regulatory changes will almost always be the first order of business for any policy review. It is essential to listen to your agent during your annual policy reviews, as every insurance policy boils down to a straightforward question:

“If I need to make a claim, will they pay me what I’ve been promised or won’t they?”

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