Blog | The Shady Underbelly of Final Expense Life Insurance

The Shady Underbelly of Final Expense Life Insurance

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Are you sick and tired of the non-stop telemarketing for insurance (life, health, etc.)?

Have you, or anyone you know, ever had a stranger show up at your door unannounced, pitching your life insurance? Or maybe they show up and do not pitch life insurance at all. Maybe they are pitching a new state-regulated benefits program?

The above scenarios are commonplace (standard) in the insurance industry. Ask 1,000 insurance agents what is wrong with the above, and 999 will say “Nothing, it’s part of doing business.”

One of the BIGGEST challenges for people (consumers) like you when researching and finding a policy. Or solution, is TRUST, trusting a COMPANY and an Agent/Broker.

How can ANY consumer trust anyone in the insurance industry when the average agent’s moral bearings are not pointing true north?

The conversation about trust is DEEP. We will peel away a few layers of the trust issue in this article. And also give examples of how and why the industry has destroyed trust.


There are a couple of idioms/saying in the insurance industry that are constantly reinforced to and among agents;

  • It’s a Numbers Game
  • You Need More Leads
  • You Need More Activity (Leads, Appointments, etc.)

The raw material for the insurance industry is LEADS. I can tell you from personal experience, LEADS are like heroin for insurance agents.

  • Agents buy leads from the most accessible “dope house” on the street
  • If one “dope house” has a shortage, agents simply find the next most convenient “dopehouse”
  • There is NO loyalty where agents purchase leads, they will buy from one house today and the next house tomorrow (marketers know this)
  • There is NO vetting of the lead source, the only concern an agent has is making sure there is a pulse, name and phone number

MARKETERS KNOW THIS … AND … MARKETERS EXPLOIT THIS. Marketers will do ANYTHING AND EVERYTHING humanly possible to sell “LEADS” to the agents.

Below is a pretty good representation of what agents pay for leads on the street.

  • Internet Leads – $20-50 per lead
  • Facebook Leads – $15-20 per lead
  • Direct Mail Leads – $25-55 per lead

WHY SHOULD YOU CARE? You must care because when you willingly provide your information on a contact form, they are actively selling YOUR PRIVACY INFORMATION on the open market, and, even worse, to multiple agents!


SO – Now that we understand – HOW MUCH YOUR CONTACT INFORMATION IS WORTH TO THE MARKETERS AND AGENTS – let’s look at a few ways that marketers collect your information and sell it to agents.

State regulated final expense program
  • 2019 Benefit Information for Michigan Citizens Only
  • Return this postage-paid card within 5 days and receive a FREE WALMART GIFT CARD

Read the postcard carefully, is it clear that you are opting in for a phone call – OR WORSE YET – some stranger showing up at your door to pitch final expense insurance?

So – you fill out the postage-paid postcard and return it to sender, what happens? That postcard lead was likely already purchased (pre-paid) by an agent, they already paid their ~ $25-55 and are just waiting for your name, phone number, and address.



Okay, so the REALLY smart marketers of the world then began to say to themselves and ask;

“It’s easy to bait-n-switch and dupe consumers with postcards, what if we try the same tactics on Facebook, I wonder if that will work?

YES – IT WILL WORK! So beginning in 2017/2018, a bunch of marketers decided to take these same tactics to Facebook. Below are some examples;

NO – NO – NO, IT’S NOT! Below are some excerpts of regulatory; requirements for insurance advertising.

Regulations on Wording

All states ban advertisements that include untrue, deceptive or misleading claims.

Audit Requirements

Insurers must keep copies of all marketing material and records on how they were disseminated that can be inspected by the Department of Insurance. The length of time that documents must be kept varies by state. In Texas, the requirement is at least three years. Michigan requires that the files be maintained four years or longer.

Regulations on Agents

There are also regulations on how insurance agents can market themselves and the companies whose products they offer. Insurers are supposed to maintain tight control over ads using their name, including any ads placed by their agents.

QUESTION: So, if it’s NOT legal, how do insurance companies and agents get away with it?

ANSWER: They outsource it to marketers while creating “plausible deniability” that they do not know how the lead (contact information) was collected.

Likewise, the marketing companies throw their hands in the air and say “I am just providing contracted services by our insurance customers.”


So – What is the Problem? How are you at Risk?

There are a couple of ways in which your safety and security are at risk.

#1) When you fill out a postcard or submit your information on Facebook, your intention is probably to receive the FREE information that was promised. You did not opt-in for aggressive phone telemarketing or – WORSE YET – a stranger showing up at your door!

Listen to the audio clip below, this is an EXECUTIVE at an insurance company training a room full of agents on the art of the bait-n-switch.

PLEASE NOTE: at the 1-minute 20-second milestone, the agent (executive) on the phone says that they just have to check her ID. This is part of the bait, the unsuspecting consumer is led to believe this is a state benefit.

THEN – ASK YOURSELF – What if this was your mother or grandmother on the phone?

#2) You can easily become a victim of purchasing a risky policy from an at-risk carrier. There is also the very likely possibility that you are NOT purchasing the best policy for your needs, health condition, age, or tobacco usage.

How Can You Protect Yourself

Life insurance is important, it’s a means for people to protect their family, their assets, and their legacy. That said, there are a couple of simple things you can do to protect yourself from predatory insurance sales tactics.

  • Educate Yourself – The more you know about the companies, the policies and the agent the better informed you will be at making a decision.
  • Don’t Make Instant Decision, Unless You “KNOW” It’s Right – The sales professionals will apply all kinds of pressure tactics, it is VERY likely that the company and policy being proposed is NOT the best policy for you (i.e. the postcard image above, most of the times the agent will be from Assurance, that IS NOT the best policy for you!)
  • Phone Recommendations – ALWAYS ask for the agent’s first name, last name, and company. If they refuse to answer – HANG UP. If they answer with a generic-sounding company, like “Senior Benefits Center” – HANG UP! If they insist on meeting in person first – HANG UP.
  • Email Recommendations – NEVER respond to or engage with anyone about life insurance, or any financial service, from a “free” email provider such as Gmail, Hotmail, yahoo, etc.
  • In-Person Recommendations – The agent should be dressed in proper attire, if not – END THE MEETING! Ask for the agent’s ID and license number, if they do not have it or refuse to produce it – END THE MEETING. Ask what companies they represent and how many options you will have to select from – IF THE ANSWER DOES NOT SATISFY YOU, END THE MEETING.

GET QUOTES AHEAD OF TIME – YES, continuing the recommendation to become family with carriers, policies, and quotes – LEARN which policies offer the best coverage and lowest cost – AHEAD OF TIME.

You can get easy and fast quotes from ALL Final Expense insurance companies by clicking the button below.

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