Life Insurance Poachers Exposed How to Protect Yourself and Your Money
Denzel Rodriguez explains the life insurance industry hierarchy (insurers like Guardian Life → brokers → IMO/FMO agencies → independent non-captive agents), warns about misrepresentation and 'poachers' who exploit customers, and explains that regulators typically pursue agents/agencies while insurers are insulated except in serious claim failures. He recommends a family-first, conservative approach to policy design (insure spouse/children first; consider whole life and convertible term combinations later), encourages financial education for Spanish and Black communities, and advises consumers to ask many questions and avoid high-pressure sellers.
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Now what I want to do here is show you the life insurance hierarchy in terms of how the industry works. Okay, so here's an example. You got Guardian Life Insurance company. They're at the top. They're. They're the massive organization with billions and billions of dollars of asset under management. Right below Guardian Life you have a broker. The broker has partnerships and relationships with what's called IMO's and FMOs. These are insurance agencies. These insurance agencies can be either traditional or MLM. So that's your, that's your WFGs of the world, that's your, that's your PHPs of the world, that's your FF, FFL. I think that's your, you know, all these three letter multi level marketing organizations that sell life insurance. They're insurance agency and in order to do business with Guardian Life, they have to establish a relationship with a broker. The broker is what helps do all the processing of the applications and helps you secure commissions and contracts. And there's a lot of other things that they do in terms of support on the business end of things and on the customer support, there's a lot of things that the broker does. The imo, the FMO is an insurance agency that is recruiting licensed insurance agents. So that would be. This is where Denzel falls in this example. So Denzel, John, Susan, Tom, Harry, Peter. Right. We all study, we take state exams and we get licensed with the state that we reside in and, and maybe other states along the way. Once we get our licensed insurance certification, we then need to get appointed and partner with an insurance agency. The insurance agency is responsible for training Denzel further on product, paying commissions in some cases and, or establishing a team of agents where Denzel can make money off of his agents that he recruits and that he trains. So that's how that works essentially. And so you have all these licensed insurance agents that are what's called non captive independent business owners. Non captive agents, meaning Denzel could sell a policy at Guardian and, and John Hancock and Massmutual and Lafayette. So I'm not tied to any one company. Denzel's not an employee of Guardian. So Guardian does not have the bulk of the responsibility of what Denzel does. Denzel could be a rogue poacher. Right. And Guardian would never know. Wouldn't know for a while. I have to follow just enough rules and not piss anybody off for a good amount of time to stay under the radar and really mess up people's lives. This happens all the time. Sometimes the insurance agency is in on it the way they train their agents to talk to the customer. And that's you all watching. So you're the customer, you're interacting with the agent. That's it. From there you get someone that comes to the house, they perform a medical examination and maybe you have a little bit of email communication, sign some papers, but for the most part, you're talking to the agent, for the most part. So you're trusting. The agent is communicating with his or her imo, fmo, which is communicating with the broker, and the broker communicating with life insurance company, which communicates with the broker, which communicates with the imo, fmo. And they keep going back and forth, back and forth until we have an approval for the customer. There's a lot going on there right now. What happens is when there's misrepresentation, when there's poachers in the space taking advantage of folks, Guardian Life takes very little blame, very little blame because they're all the way up here. The broker takes very little blame because they're up here. Where the blame really falls on is the insurance agency that taught Denzel what he or she knows about how they're going to talk to the customer. And when the customer complains and they file with the state, the state goes after Denzel and the agency. Typically, that's where they get some money from because it's too much to go after the big company. Unless they did a royal screw up. For example, if Guardian Life didn't pay on a death benefit claim, now we got an issue. Now the state is going to use their power, come after the insurance company, say, wait a, hold on a second. Even though the policy was designed horribly or whatever the case, there's still some guarantees in there, which is the death benefit. The death benefit needs to be paid out to the customer. That's when there's a royal screw up, is when the life insurance company doesn't pay a death benefit claim. When that happens now, the blame's on them, not the agency, not the broker, not Denzel. It falls on the insurance company. So there's very little things that will fall back on the life insurance company. So when we're talking sales and strategy and process and the amount that they sold you and all that good stuff, lot of gray area there. It's, you're essentially free to sell however much death benefit you want to an individual as a licensed agent, there is very little fiduciary responsibility to do the right thing for the agent, for the customer. Sorry. Which can present some issue there. So when it comes to Proper education and strategy and death benefit amount and the amount of life insurance policies. The reason why there's so much flexibility there is really for the customer. Now, it can be a negative, but the positive is that, well, you can have as much life insurance policies as you want as a customer. There's people who have dozens and dozens of life insurance policies to maximize death benefit protection. Because essentially what they're doing is they're purchasing their future net worth. And if they can afford it, they will pay for it because they understand what they're doing. But the vast majority of people do not understand that. So, again, I've never been in a situation where it made sense for me to even write more than one policy on an individual. I just, I haven't been in that situation every single time I'm designing a policy exactly according to what they can afford with their numbers, the position that they're in. And then chances are, if they're like, hey, I want to. I have more money that I'd like to put away in another policy. Well, then I say, well, maybe convertible term can be in combination with your whole life. Okay, so, sir, okay, mom, let's look at dad. Let's look at mom. So if I'm talking to dad, husband, and he wants to put more life insurance, I'm like, well, we already got this policy in place. Let's say I already sold him a whole life policy and it's been three, four months. He's like, hey, I want to do another one. I'm like, well, let's get wife insured first. Then let's do your kids. And after we've put a policy on wife and put policy on your kids and you still want to fund more money into your life insurance contract. Okay, then we go round two. Now we're starting a policy, a second policy on yourself. Maybe there's that case. Or I like to go up and sideways in terms of the family tree. I'm like, hey, what about mom and dad? You still have mom and dad in your life. What about mom in law and dad in law? What about brother, sister? What about nephews and nieces? Is there anyone else that we could insure that doesn't have life insurance in your family that you love and care about and support and if something were to happen to them, would be a detriment to your finances? Let's make sure we insure everybody. And if you still have more money now we come back and you do round two again. You go over it again. That's how I do my Practice. When it comes to life insurance, if I'm doing something wrong, call me out on it. But when it comes to this life insurance poachers, it's getting annoying, it's falling frustrating because it puts such a stain on an industry that already has terrible stains for, for so many years. And there, there is a side to life insurance strategies, whole life, specifically in convertible term, that in the Spanish community we know nothing of. But when I hang out with all these white folks and I go to these events and I go to these masterminds and I get in rooms where I don't belong and I get invited, I get vouched for, so I get inside the room and I'm hearing what these white people are talking about, you know, what would the Rockefellers do and what did the Walmart family do? And how all these politicians own properly structured whole life insurance and how all these rich white folks are doing these things and making tons of money and passing on millions and millions of dollars of tax free income and death benefit to their heirs and how they're able to multiply wealth generationally over and over again. I'm like, this is freaking amazing. I want to be a part of this. I want to take this to the Puerto Rican community, I want to take this to the whole Spanish community as a whole and the black community and be like, yo, let's like, we need to pay attention to what these other cultures are doing, man. They're building their own private banking system at a, at a massive scale. Let's do the same thing. Let's rotate our dollars in our community before it ever leaves. Let's rotate the $2, 3, 4, 5, 612 plus times before it ever leaves the economy. So I get extremely passionate about this stuff and I hate to see people get taken advantage of. And my hope is that this video gave you a framework. Ask lots of questions, lower the temperature, take your time. You don't have to rush. When it comes to investing, when it comes to saving money, when it comes to setting up assets properly for legacy planning, you do not need to rush these things. I get the urgency. That's good. You want to get it done, of course. But let's ask a ton of questions. And if the person you're asking a ton of questions to gets antsy or is trying to sell you on something, guess what? They probably don't. They're probably not the right person for you because they're just solely focused on their paycheck and not actually impacting your life and serving you at the highest level.
