Primerica Shady practices, exhorbitant fees, preying on the il-informed Ripoff Waukesha Wisconsin

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*UPDATE: Primerica gets a POSITIVE rating from Rip-off Report in customer support & satisfaction. Primerica pledges to resolve complaints from the past, present and in the future, and give 100% commitment to customer service-say Company Executives!

Anthony never responded to my post, (scroll up 3-4 posts) in which I showed the rate of return necessary for primerica to earn to equal the amount that comes back to the client in Return of Premium term sold by other A+ companies.

Instead, he branched off into mutual fund portfolios returning 12% over 20 years...(I could find only 4 funds in Morningstar.)

Hi Anthony,

Hope you've enjoyed your vacation. I am not Gary by the way. Don't know why did you choose to address me by his name.

Just as Leroy has pointed out, I find 12% a year average return over 20 years to be a very unrealstic number. When Leroy says he can only find 1 fund that Primerica sells which has given 12% a year for 20 year, I believe him (unless you show me otherwise). If Leroy's statement is true and we assume that you always buy several differnt funds for your client in order to add diversification their portfolio, it means none of your clients will have a 12% rate of return for 20 years.

This is why I stated that it is very misleading, deceptive, and irresponsible to give clients a false sense of hope by leading them to believe their investment will be average out to be 12% a year for 20 years.

I believe you when you say you can show me portfolios that have given a rate of return of 12%. But remember, we are talking about 12% average each year for 20 years. The past 20 years spanned through many market up and down swings. When the market is good, lots of funds will give rate of return of over 12%. But when the market is down, these fund may even lose value. Finding funds that gives an average rate of 12% for 20 years is extremely difficult. When we talk about long term investment like for 20 years, finding funds that yields an average 8% rate of return is a much more common

Even if you show me funds that have an average rate of return of 12% for 20 years, you should know that past history does not gurantee future performance. In your earlier post, you recommand us to read Robert Kyoskaki book's Cash Flow Quadrant. You must believe the things that Kyosaki say in order to recommand his book, right? Did you also read Kyosaki's book Rich Dad Prophecy? If you did, there is no would think a stock had previously grown 12% anuualy will continue grow at that rate after most baby boomers retire.

For the record, I'm not a big fan of Kyosaski.

I appriecate it when you explain to me that Sheltering tax is not the only factor take into consideration. That is true, but I never said tax shelter is the only factor to take into consideration. Our conversation started because you asked Leroy "Why do you insist on selling Cash Value when the experts say term is better?", and I gave my feedback to this question. There are pros and cons of UL. The point that I was making was unless an advisor sits down with me an analyse my financailly situation carefully, s/he is in no position to tell me what type of insurance suits me the better.

Which is why when my friend's upline come to my home and tell me that UL is garbage, but then later changed his word completely when I find out more about UL, I lost a lot of respect for this upline of hers.

I was exposed to this same 12% stuff when I went through securities licensing and training but I just don't see it in the real world. In fact neither does Morningstar. I did a search for funds that have averaged 12% return for 20 years or more. There were 4 out of 9,000. For the record primerica only has a selling agreement with 1 of them.

You can get 12% in First Deed of Trust portfolios which are guaranteed by the real estate they are on. All you have to do to be safe is keep the loan-to-value ratio at 65% or less.

You mentioned the SP500.....if you go to their website and use the data from there the average annual return for the SP500 from its inception in 1950 to now is 8.6%. That a raw return with regard to taxes or expenses. Thats a far cry
from the 12% we were taught.

You mentioned that people should fully fund their 401K before doing a variable universal life. I agree. To have an employer match your first 3% dollar for dollar means you have achieved 100% growth on your money in the first year. Thats an unbeatable investment.

There is a big HOWEVER on the horizon though and it ties in with your comment about agents unnecessarily putting fear into people so they purchase guaranteed products. I began selling variable annuities with guaranteed growth riders in 1997. In fact, I have quit selling mutual funds altogether. Before gary pops off, NO, the first year commissions on variable annuities are no greater than on mutual funds. I have found that people who are fearful of the market are very receptive to these annuities. To have a minimum guarantee of 5% on growth versus the return of the market, whichever is greater, is just enough to get a fearful 48 year old to be in the market where they belong.

Now comes the news that the first Variable Universal Life which guarantees growth on the cash values at 5% versus the return of the market, whichever is greater, became available for sale on June 1. I had pretty much stopped selling VULs because it was always my fear that the market take a giant dump and the policies would implde, and I'd get sued. Now I have to rethink my position.

Hi Gary,

I've been on vacation but just got your response. Every person's situation is different. There is certainly more than one way to approach a problem. 12% rate of return is not guaranteed, but as Leroy can attest, historical data on mutual funds are more more than capable of achieving that. We can't promise future performance.

I would never suggest that someone put all of there money into one account chasing 12%, just like I wouldn't suggest most people put all of their money into savings bonds over a long period of time. It all depends on their goals. My point of mentioning the potential for 1,000 bucks a month growing to 1,000,000 dollars over 20 years is that it is very possible. Most people I talk to are shocked by the possibility. If someone's risk tolerance isn't there or if they have different goals, than we go in a different direction. If you look at the performance of the S & P 500, you can get a good guage of the economy over a long period of time. In my opionion, and Leroy has more experience, most agents seem to use fear to keep people in guaranteed products unnecessarily.

Here's my bottom line. I propose plans to my clients based upon their risk tolerance, goals, timeline, and historical data. No plan is perfect, but it's a sound way to do business. I can show you multiple fund portfolios that have gotten 12% or better ROR. Tax analysis is another consideration.

Sheltering taxes is a factor, but shouldn't be the only factor. For example, in the US an employee could have a 401K where the company matches dollar for dollar the first 3% and 50 cents on the dollar for the next 3%. That means for the first 6% they invest in their 401K the company, in this case matches 4.5%. That's basically a 75% rate of return, guaranteed. Yet folks out there will be paying their VUL instead to avoid taxes of one form of another. It just makes more sense, in my opinion, to fully fund the 401K first. There are other ways to legally avoid or reduce taxes.

If my plan would make more sense for you then you would want to move forward, right? If it made sense. If it didn't make sense for you, then nothing I could say would make you move forward right? I have no problems with that. Either it's a better plan that is clearly understood or it's not.

Good Luck

I hope it all works out.

He, like all primericans, object to Return of Premium term but they have no business doing so when you look at what primerica charges for straight term versus what what other A+ rated companies charge for return of premium. Lets look;

Return of Premium term returns all the premium paid by the client at the end of the 20 or 30 year contract. It comes back;

SAMPLE QUOTE

40 year old male, healthy non-smoker $200,000 policy

primerica 20 year straight term.............$337
A+ rated company 20 year Return of Premium..$439
Difference..................................$102
Refund in 20 years for return of premium...$8780
Mutual fund NET growth rate on $102 yearly difference needed to match it..............12.52%

Its worse for primerica when the client is a female

primerica 20 year straight term.............$337
A+ rated company 20 year Return of Premium..$359
Difference..................................$ 22
Refund in 20 years for return of premium....$7180
Mutual fund NET growth rate on $22 yearly difference to match it......................22.95%

Now lets look at them as a couple. In this case primerica would give them $100 premium savings per year because they will waive the second policy fee. Many other companies do this too, but not the one I am quoting.

Primerica straight term for 2...............$574
A+ rated company R.O.P for 2................$898
Difference..................................$324
Refund in 20 years for return of premium..$17,960
Mutual fund NET growth rate on $324 yearly difference to match it......................8.95%

Finding a mutual fund that pays 8.95% NET growth rate over 20 years, which is after taxes and expenses, is doable but tough. Finding one with a guaranteed rate of
8.95% GUARANTEED and government insured is impossible...none exist.

Finding a mutual fund with a GROSS growth rate of 12.52% over 20 years is even tougher. Only 4 exist and primerica doesn't have a selling agreement with 3 of them. The NET growth rate after taxes is less than 12.52%, and of course its neither guaranteed nor government insured.

Finding a mutual fund with a growth rate of 22.95% over 20 years is just impossible. Nothing comes with 9-10% of it.

For any primerican to say "Return of Premium is just another ripoff dreamed up by insurance companies" means they are just parrotting what their management says to defend their position.
Management has to say it because its why they get paid big bucks. For a rep to repeat it shows no market knowledge or market analysis. Do you want someone as your adviser who would not investigate a product for himself to see if it has any application in your case?

If you want to compare Return of Premium to the best rate on the market then the growth rates the
male and female have to find in a mutual fund to match it are 7.69% and 6.78% respectively. Very doable but still not guaranteed or government insured.

Return of Premium term appeals to some people but not all, not even most. However, when talking to a financial adviser do you want it to be offered with an anaysis of the return so you can make up your own mind, or do you want some salesman to pooh-pooh it because he can't offer it? The latter is what you get when you talk to a primerica rep.

Great post. I can answer a question for you.

You said you didn't know what estate taxes are in the USA. They are in limbo. In 2005 the estate tax threshold was $1.5 million. Anything over $1.5 million was 43% for awhile, then goes on a progressiveley higher tax table according to the size of the estate. It quckly reaches the highest level at 55%. Bewteen now and 2010 the taxation threshold will be raised each year from $1.5 million until it reaches $3,000,000 in 2010.

Bush got a law passed which will faze them out entirely after 2010. However, the lawis subject to a renewal vote in 2010 so it will depend on whether the democrats or republicans are in control of Congress at that time.

Both are wrong on the issue. The democrats think a $3 million dollar estate is gigantic and thats where estate taxes should start. They had the number at $1.2 million when they were in control. $3 million puts too many family businesses at risk of being estate taxed out of existence and killing jobs

The republicans are wrong because an estate tax should exist...it just shouldn't start at a $3 million estate. If you adjusted the estate tax for inflation beginning with its inception in the early 1900s it would be $15-20 million.

In the USA for life insurance to be estate tax free it has to be owned by an Irrevocable Life Insurance Trust with Crummey Provisions. The trust is the owner and beneficiary of the policy.
The premium payor, who wants to avoid estate taxes, must offer the premium to the trust as a gift. (Crummey Provisions) The beneficiaries of the trust, usually the children, have the right to take the money for themselves instead of letting it pay insurance premiums.

By the way, you stated my philosophies as an adviser perfectly. I don't really have an opinion on whether cash value insurance or term is better. It depends 100% on the situation and desires of the person you are advising as to which is more appropriate. 90% of the policies I sell are term......I can give solid reasons why the other 10% are cash value.

Hi Anthony,

I'm not Leroy, but I would like to address to your question "Why do you insist on selling Cash Value when the experts say term is better?" from a consumer's point of view.

As indicated in one of an earlier post where Gary and I were exchanging info, I told him about my encounter with my friend who works for Primerica. When she brought her upline to my house to do a Kitchen Table with me, her upline knows that I own an UL policy, and he proceeded to tell me things like UL is always a rip-off and term is always better, etc. He pointed out all the disadvantages of UL, but he never compared the advantages of UL with term.

When somebody so opinionated and dont see both sides of the arguments, I don't want to follow his advice blindly without doing some research myself to see how valid his accusations are. I looked for advantages and disadvantages of UL vs term, and the advantages of UL that I've found include:

1. Premium doesn't go up
2. No expiration Date
3. Investment is tax sheltered, etc.

I then brought my findings to my friend. She at first seemed annoyed being challenge. She later on related my findings to her upline, and her upline went back on his word and taught my friend that there indeed are situations where UL is better than Term, such as the case for Estate Planning. And yes. These words came from a Primerica representative, saying that there indeed are times when UL is better than term.

I don't know about the laws in US, but in Canada, the tax is extremely heavy to pass our inheritance to our beneficiaries. However, all the investment under UL will be passed to our beneficiary tax-free. In this case, UL provides a huge advantage. BTW, Gary also told me in an earlier post hat there indeed is a type of UL where we can get both the insurance and investment after we pass away. The myth that Primerica taught you where you only get one or the other is not always true. This is why when Primerica agents tell myth containing incorrect information to clients, this can hurt the clients' ability to make the best possible decision. You claim to be doing the right thing by spreading the gospel, but it would help us better if your gospel contains the correct facts. Besides, I would much rather not know something at all than to have the wrong information passed on to me. If I dont know anything about investment, I will just not invest. If people who claim to be expert pass on some incorrect information to me, I can lose a lot by making the wrong decision. Just because you put all your clients in better position after they meet you, it doesn't mean others will do the same.

From a consumer's point of view, there are advantages and disadvantages of various insurances. You pointed out that experts say Term is better. However, those experts are only making a generic statement. Personal Finance varies from individual to individual. Generic statements do not apply to everyone. If somebody just tells me that term is better than UL without first analyzing my financial situation, spending habits, income, etc. I would question the knowledge and analytical skills of that agent. I will also try harder to look for another financial advisor with better analytical skills to provide me with important decisions of life such as how to handle my finance.

I believe you when you say YOU (but not all agents though) put clients in better situation after they meet you. But that is simply not good enough. If I just want to be in a better situation, I can just put all my money in a GIC account. When I look for an advisor whom I can trust, I certainly hope he'll do what is the best for me. Simply repeating generic advice from experts without thoroughly analyzing whether they apply to my case is definitely not the type of advisor whom I can depend on.

That concludes my comments towards why consumers may prefer cash value. In the mean time, I would also like to point out that some of the numbers that you provide can be interpretated differently. For example, you said "95 out of 100 at age 65 are still broke". If Primericas mission is to eliminate debt and the company has been around for over 29 years, does that mean Primerica is doing a poor job because there are still lots of people in debt? Of course, you can make all sorts of arguments to say otherwise, but the point remains numbers like the ones that you have provided don't mean anything. There is no point of you to bring up these numbers up in the first place.

I would also like to comment on your earlier post about investing 1000 a month for 20 years. Mathematically, it is true that investing $1000 a month for 20 years in a fund that grows 12% a year will give you over 1 million dollar. However, when you say that is the Primerica way, I am afraid you are being very misleading and deceptive towards your clients or potential clients. You know very well that you can't guarantee your clients that their investment will grow at a rate of 12% for 20 years. How can you say that is the Primerica way?

I apologize in advance because I will sound harsh in my next statement. Even though I believe you are a successful, nice, and smart person, I feel it is very irresponsible for any agents/advisors - regardless what company they work for - to be making false claims like these. You sound like your clients will have an average 12% return for the next 20 years. What happens after 20 years and their investment is nowhere close to that amount? Are you just going to tell them that they should be happy because they are in a better position than the days before they met you? No. You can't do that. You make things sound like returning 12% of investment per year for 20 year is the Primerica way. If you're a good advisor, you certainly would be responsible for your words and also dont mislead your clients by providing them false hope.

Just like what you've said about Leroy, I too think you seem like a nice person. I admire you for coming to this site to defend your believes using a tone of voice which is much more professional than other Primerica agents(including RVP's) who have posted on this website. But do keep in mind that when you are trying to defending the reputation of your company, you certainly wouldn't want to worsen it by making false and misleading claims. Otherwise, you may end up damaging, rather than helping, your company's reputation.

On a more personal note, at the age of 37, you're thinking of quitting your 300K a year job to go full time with Primerica? That sounds like an extremely risky move. I really hope that youve carefully analyzed all the risks invovled before making important decisions of life like that. I wish you good luck, but in the event that things do not work out well with Primerica as your full time career, I really hope you already have a plan B in mind so that you will be able to go back to your current job, something similar, or even something better. That way, you will earn enough to maintain your current living standards and also save up enough for your retirement. Good luck once again.

I don't insist on selling cash value insurance. I offer it as a solution when its appropriate. All the "experts" you mention are still talking about policies that went out of existence years ago....and by the way...those same "experts" you quote like Suze Orman and Dave Ramsey say to always buy NO LOAD mutual funds. Why is it primerica people like to quote these self proclaimed experts on life insurance and then ignore those very same experts on the no-load versus adviser debate?

Why has the sales force dwindled. I dunno. Maybe because lately the people who might have gone into insurance get into real estate and loans instead becuase its been easy pickings. Insurance is hard to get started in.

When should a 24 year old single mom have cash value insurance if she makes little money? NEVER!!!! When should she pay primerica $257.50 a year for $250,000 of term insurance when she can buy it from an A++ rated company for $105 a year...NEVER!!!!

I'm glad you seem to be able to tell the difference when replacing a cash value policy would hurt the client too much to do so. 99.9% of PFS reps seem incapable of discerning that. I had a primerica rep tell a client of mine he should drop his Last Survivor Life he owned inside an Irrevocable Life Insurance Trust for estate tax purposes and buy term and put the rest in mutual funds. He simply didn't know those mutual funds would be shrunk 70% at the client's death by capital gains and estate taxes. I had a primerica rep tell his father-in-law he should drop his universal life policy when he was unhealthy and uninsurable. He paid the policy two more years then died leaving his wife $150,000. I know, there are bad reps with other companies but with primerica reps who don't have a clue are the vast vast majority. Reps you see trained at some other companies are more responsible and knowledgeable. When they see an ILIT they know why its there.

Why don't I create a greater sales force to protect my clients? Two reasons. One, I don't want to manage other people...two...I have an agreement with someone 20 years younger with the same business philosophies as mine to buy my business from my widow. I trust him to take care of my people as I would.

You always leave people in a better situation? Why would you shy away from the opportunity to leave them with the BEST possible solution? Mediocre is better than bad but its still not good.

Yes. Math is math and voodoo math is voodoo math. Any presentation about a loan that has "interest rates don't matter" in it is using voodoo math.

You let people know when there is a better solution? There is ALWAYS a better solution to primerica overpriced term and overpriced loans. Why not be the one who offers it to them and make more money for you while saving them money?

What do you care if the rest of the industry hasn't bundled all its services? The point is YOU CAN DO IT!!!! You can be the agency that bundles it all together and gives your clients the BEST POSSIBLE solution from a number of companies and then be the one person who services it all. Why are you so hung up on having ONE SINGLE COMPANY to offer? I did that. I worked captive for AAA for 5 years and I'll never let that happen again.

Maybe you understand the interest rate "debate" as you call it, but 99.9% of your PFS cohorts don't. I have a guy on another thread who claims he has been with primerica 20 years and he still doesn't realize there is very little difference between simple and scheduled interest and that all biweekly does is create the equivalent of 13 payments over 12 months.

You offer a total solution??? I don't think much of that solution. It now bothers me that you have been informed how you personally can offer the BEST solution to each client but you are still unwilling to investigate it for yourself. Why would anyone want a financial advisor so reticent to explore the financial services world?
By limiting yoiur knowledge to one company and what one company tells you you are limiting the knowledge you have to protect your clients and successfully guide them til retirement.

No one will make you sell cash value insurance. Those people I told you about could care less if you ever wrote a cash value policy. But they can have you licensed with 100 companies that sell term life at better rates, 100 companies that offer annuities, and 15 companies that offer long term care by filling out a single form. The broker dealer I told you about will allow you to sell mutual funds with each and every mutual fund family out there, not just a select few. Any loan broker up the street from you can offer your clients 100 different loan programs to find the one that matches perfectly.

You would be the glue that bundles it together, not some cynical faceless corporation in Atlanta, Georgia. Your clients do business with you. In reality they could give a rat's rear less who the company you offer is.

Just a couple more things...you said MY WAY doesn't work and that 95 of 100 people retire broke. First of all I have never said someone should use life insurance as their main retirement funding vehicle. If it provides a few extra bucks fine but to use it as the chief means of saving for retirement is insane in 2006. It wasn't insane in 1906.

You guys to need to update your rhetoric. 95% of a people die broke??? LOL! April 26, 2006 USA TODAY had an article quoting the U.S. Dept of Labor which said there are 8.3 million households in America with a net worth of $1 million or more. There are approximately 100 million households in the USA. That means 1 in every 12-13. A million ain't what it used to be, but a million ain't broke.

I'll do a seperate post about ROP term. The one thing I'll say now is you used the exact same rhetoric primericans used about thirty year term when it first came out. Then you guys started to sell it and all of a sudden it wasn't just another way for insurance companies to "rip" their clients.

Lastly, I'm on no jihad to reform the insurance industry. The marketplace does that just fine. I will admit to a jihad against primerica because I believe they are a cynical company that preys on lower middle class americans with bad products and with half trained reps who hurt poeple financially.

The one thing I'll willingly give a primerica rep is the $25 a month mutual fund client. My commission would be 75 cents a month and the paperwork and liability isn't worth it to me. Besides, I no longer sell mutual funds. I only sell variable annuities with GRIB riders because of the guaranteed principle. If anyone wants mutual funds in any amount I send them to my 40 year old buddy who is going to buy my my busines.

Why do you insist on selling Cash Value when the experts say term is better?

Why has the insurance industry's sales force dwindled so much over the last 25 years.

Can you tell me when a 24 year old single mother earning $10 per hour should be in a cash value policy for $200 per month when she can't afford to live outside of her parents home.

I analyze Cash Value policies and offer an alternative plan. In some cases, the client is so locked in, I don't try to replace it because i would hurt them too much. That's no indiscriminate!!

I really don't hate insurance companies, they are a very necessary part of what we need. I don't like agents who don't do what's in the clients best interest with the best that they have to offer. Say what you want, I never hold back my best rates or products to my client. If my rates or products are not competitive, than so be it.

You are winding down your career now, but why haven't you created a larger sales for to protect your "presidents?"

I ALWAYS leave a client in a better situation than when I first met them.

Who cares about practices of yesteryear unless they are still being used. I have friends that work for some of these other companies and if you think they aren't being used, then you are wrong. Prudential offered me a job before I even heard of Primerica and they give me the creeps.

The math is the math. We choose to look at total cost...if we win we win. If we don't, we're not mad.

My being captive to Primerica is limiting...no doubt. But that doesn't mean that I can't let my client know that there would be another viable solution for them.

You mention all of these wonderful solutions. My problem with all of what you are saying is why don't you and the rest of the industry put together the comprehensive plan to offer the total solution? How come my bank never shows me how the extra payment will pay off my loan? How come when I call my car insurance company about life insurance, they only talk about cash value unless I ask? My problem is that you are guilty of the sin of silence. You know so much more than "half-trained" Primerica reps, yet you don't get out the information to the masses. We put people in a better situation than they were in. You sit back and complain about us. You seem to be upset, not with us, but that you didn't get out there and spread your gospel.

We understand the interest debate. It's a feature of our loans, not a big difference maker. I don't even get into tha with clients...who cares?

Bimonthly, extra principal payment...it's a wash. Nobody is debating that. We are about total solution. Again the problem is that not many out there are offering total solutions. My clients would rather save $1000 bucks a month, pay off their loan in 15 years and have 250K saved by that time. If your clients are looking for "safe" than help them reach that. But I know a lot of people who don't want to be broke at retirement. Your way has not worked. That's why 95 out of 100 at age 65 are still broke. You see, I help people get wealthy. The numbers don't lie. My problem with other companies is that they don't seem to let their clients know that there is a better way to get wealthy than accumulating a cash value to borrow against for college and withdraw for retirement. I know there are other reasons you sell you cash value, but when I ask people why they have cash value, that is always their reason.

Return of premium is a rip no matter how you dress it up. You don't want the investment risk...put it in a CD, invest in bonds. Stop scaring people with the risk argument. Considering inflation, ROP is absolutely horrible...just another way for insurance companies to get rich. Risk can be managed. Why don't you tell the 35 year old that the S&P has not been negative over a 10 year period dating back to the 60's? Your approach, perhaps "half trained" strategies for investing hurt people!

Your point on $25 a month investments is my point. Every one has access to the same investments that I do...but why don't people offer that to their clients? You see my biggest beef with you ripping us is that you have all the answers I have and according to you even better answers...why don't more people know about them! You say you're in business to protect your clients. The truth is you do this to make a living...it's my calling and my cause to help people get on track. I grew up in the ghetto and through employment, I've made a tremendous living...and I'm only 37. It's time to give back. Every company I've ever worked for went against the grain. It's always been a fight. Rightness and Goodness will prevail as always.

Leroy, you seem like a nice, competent, and compassionate guy. We just disagree. Your hatred for Primerica, has you missing the point here. I agree with many of your conclusions in terms of products. I take each of my clients and their circumstances on an individual basis. There's no cookie cutter approach there. I bring value to their home. I get them on track. I give them real hope. I follow up with them. It's about their goals and their dreams. I have many stories as I'm sure you do. I work very hard on my job. Primerica is more spiritual for me. I don't need the money. You are right, I could make more somewhere else. But it's not about me. I never have to think that I need to close a sell so I can feed my family. That's the beauty of the part-time opportunity.

Finally, I repeat...If you have a better way, than get a larger team and change the world...otherwise quit bellyaching! LOL

Last Word (for real)...to all the Reps out there (Primerica included) do what's right. Some doing things to get the negative press.

Lets establish some common ground. I too hate insurance companies. The difference is you hate them all except primerica whereas I hate them all ESPECIALLY primerica.

I look at myself like a Secret Service Agent guarding a president...in this case the president is my client and the would be assasines(sp?) are insurance companies with assinine rules and sales jargon designed for self benefit. Its my job to cut through all the crap they put out and direct my client to the safest possible deal they can get.

What I hate about primerica, besides the fact they charge way too much for insurance and loans, is the attitude that all other companies are evil and they are the saviors of the middle class. I think I can make a pretty good case they prey on the lower middle class.

Yes, State Farm, Allstate, Farmers and a myriad of other companies also charge way too much for term insurance. The difference is that they don't hold themselves out as sellers of "comepetive term". Instead they say they offer term at a convenience store price so that the client can have one agent do everything. I say any client who falls for that doesn't think too deeply. I know its easy to say "American General would only save me $20 a month over State Farm for term life so its worth the convenience" but the real difference is $150,000 greater death benefit to the family if the client dies. That makes the convenience factor frivolous at best.

I truly object to primerica sending out people with a canned sales pitch (I object to anyone in any field that does that). Its not so damaging when talking to a sales rep about a new Trane central heat&air unit but when it comes to family finances mistakes cost too much and can't be trusted to a cookie cutter approach.

I REALLY object to the fact that primerica's canned sales pitch is so deceptive, misleading, and distorted about other people's products and business practices. Hauling out 1979 FTC reports about policies that 99% of companies quit selling 20 years ago is just plain deceptive and self serving.

Finally, I have no use for voodoo math that tries to say a 7.75% loan is under ANY circumstances better than a 6% loan. The only thing a 7.75% is better than is an 8.00% loan.

For example;

1. Other companies charge $399 to set up bimonthly plans. So what? The difference in interest on $250,000 loan in the first month is $437.50. The $399 fee is made up before the borrower makes his second payment.

2. Scheduled versus simple interest...another straw man. The most savings possible between simple and scheduled interest is 30 days worth of interest over the life of the loan. On that same $250,000 loan ALL THE POTENTIAL DIFFERENCE ($2146)between the two would be made up in 5-6 months. After that the lower rate loan is pure savings for the borrower.

3. Bimonthly plans....totally unnecessary. All a bimonthly plan does is cause the client to make 13 payments a year instead of 12. The same thing can be accomplished by adding an extra 8.33% of the principle and interest to each payment. Then you are not locked into a bimonthly plan with 26 chances to be late instead of 12. Adding the 8.33% extra payment to a 6% Countrywide loan over a 7.75% Citibank biweekly loan will pay off the loan an extra 4 years earlier, saving nearly $100,000 in interest payments. That makes the scheduled versus simple interest argument moot.

4. Blended rates...there is no such thing. Its just jargon invented by someone to help sell refinances. Home debt and consumer debt should not be commingled for the greatest possible family financial health.

Lets talk Return of Premium term now. It returns all the client's money to them at the end of the term;
a. guaranteed
b. income tax free
c. regardless of changes in stock market or interest rates
d. government guaranteed*
*- (state insurance guaranty associations exist that will guarantee the death benefits and cash values in policies if the insurance comopany goes belly up. The limit is $250,000 in California.)

For some clients that is an attractive bundle of benefits. They don't care if they could get a better rate elsewhere in a riskier investment. Some people are more highly motivated
by a return OF their money, not ON their money. Most don't care for the higher premiums. I have found 75-80% reject it. The difference between a primerica rep and an independant is the primerica rep will claim it is always bad because he doesn't sell it whereas an independant will offer it as an option. The thing is primerica overcharges women so much I can sell them Return of Premium term in many cases for less than primerica would charge them for straight term. Any objection from any primerican is sheer craziness under those circumstances.

You say "THERE IS A CAUSE". Yeah.....and my cause is that I don't want half trained primerica reps out there indiscriminantely(sp?) replacing all cash value products because they don't understand them and aren't capable of determining when they are appropriate to the situation.

I don't wan't half trained primerica reps out there ripping people off on loans because they don't have the intellectual curiosity to actually examine the math behind the primerica jargon about loans.

I don't want primerica reps out there repeating symbolic outright lies like other companies wouldn't offer term til primerica came around. I started as a career agent for Bankers Life. We sold term. We aklso had selling agreements with Transamerica and AIG to sell their term too. So did the guys at Pru and Met and NY Life.

I don't want primerica reps out there telling practical outright lies like;
a. they are the only ones who will set up an investment plan for $25 a month. Its the mutual fund family that decides that, not the selling bvroker-dealer
b. primerica is the only company that has the terminal Illness Rider at no separate charge. THEY ALL DO!!!! Not all offer the rider but among the 600 companies I quote not a single one has a separate charge if thery offer it.
You challenge me to join you to build a better company...we don't have to. They already exist.
I myself am not interested in manageing other people. I am ready to slow down and enjoy the world while I have both the health and the money to do so.

You wanna build a better company? They already exist. The editors here won't let me give you any names but let me tell you a story. I was driving in the MOUNTAIN the other day thinking about all things FINANCIAL. I said to my wife DOT, "we ought to go see my cousin COM". We should also call cousin RIC. His new license plate is X-105. I heard he got a COMMISSION for that STRUCTURE he designed. Then when we go to Folsom, CA we ought to go see my brothers BRECEK and YOUNG. They are always BROKER than me because they are DEALERS."

Then I said to her "I have been thinking about getting into the loan business. I think I'll go see any independant loan agent up the street and see what kind of deal I can work out for me and the people under me".

Should you decide to start your own agency you can get 80-105% commission on life insurance from your first policy. The same goes for those under you. Thats negotiable between you, the subagents and the superagent. On mutual funds you can get 60% of the broker dealer concession from day #1. I negotiated 75%. Other guys who produce more than I do get 90%. I don't sell loans but I have a close friend who has a loan agency. He is getting $5000-6000 on a $250,000 loan which he splits with his subagents on an individually negotaited basis.

Lastly, even if I ripped other companies here, (which the editors don't allow on this thread) it wouldn't change the facts that primerica overcharges its clients for products and undercompensates its sales force.

Leroy,

Slow down. Number one, I admitted up front that our loans suck in most cases. Again, I didn't opt for the loan solution for my family. But, for people who have a lot of debt and are tired of playing the sick game of refi every few years, we make a difference. As for the biweekly payments, they COULD work on any loan, depending on the rules in your mortgage. (I challenge you to do your homework) Most companies require you to pay a fee to set it up.

I had Countrywide a few years ago. I made my September payment in full. On Sept 14 I paid a "halfly" payment. On Sept 28, I paid another "halfly" payment. On October 6, I got a call from Countrywide saying my payment was late. I explained how I was going to be sending in biweekly payments and they told me to read my mortgage agreement...they don't accept partial payments. They then credited my account for payment in full on Oct 6th, not a day before. It's not automatic as you would suggest. I then asked for an amortization schedule to show my loan being paid off if I make 1/12th of a payment towards my principal. They didn't know how to produce such a schedule. (Don't just refute it...call your mortgage company and see. I just had a conversation with Chase. They want $399 for me to use a biweekly plan, but they won't put anything in writing regarding a new amortization schedule. The guy told me he would send it, but he never could. All I'm saying is check it out. Again, I restate my point. There are better loans out there. But sometimes we are a better solution depending on the situation...and the math would verify that.

As for insurance. I'll admit that I've gone to meet with potential clients who have a Primerica policy who have not seen there rep in years. But it's no more frequent than I meet someone who has a Prudential or State Farm policy. that sucks for the client. My clients hear from me at least every quarter. Our policies have great features that I don't often see in other policies. Products are always changing, so I'm not going to bet my bottom dollar on it. But I know we are competitive on 20, 30, and 35 year term. Our 25 year term is a little pricey for some reason.

Listen, you have to admit that before Primerica and our tenacious effort to replace cash value, most other companies, especially the ones your listed, wouldn't even offer term to their clients. But that's who you defend. If you let a Prudential agent into your house, he will never offer you term unless you ask for it. Yet "experts" like Suze Orman says buy term. But you defend them. Someone mentioned return of premium. ROP costs more than term without it, right? If you take the difference in cost and invest it, you would have your own money in your own pocket.

Your right, I could go out and start my own company. And one day I might. By there is a system in place that I understand and I like. it's not just about selling products. There is a cause. There are a lot of injustices in the world and despite your opinion, Primerica is not part of the problem. Why don't you rip on the industry for selling cash value to people and underinsuring them? Why not rip on industry for NEVER offering a debt solution that doesn't require purchasing a product? Why not rip on the industry for forgetting about the millions of people that need insurance, but don't have the net worth to be worth their time? How many in the industry will help someone start saving a miniscule $25 month towards retirement? Why not rip the industry for selling high cost annuities to 30 year old teachers through their unions? Why not rip the industry for selling those nasty interest only loans that people can't afford once they refi? It's not good for everybody, but they sell it that way. People are broke Leroy. Why not rip the industry for not recruiting more reps to go out and help America? Why...because they are to cheap in the heart. We are not the cause of that problem. The industry has had the information for years. WHY DOESN'T THE INDUSTRY HELP LEROY!!!

Say what you want about PFS. Again, I lot of what you say is right on the money in terms of our products not being the cheapest. Our solutions may not always be as great as other possible solutions out there. But they are better than our clients current situation. How hard do you search for the cheapest solution? How often do you buy the cheapest products out there? Do you buy anything name brand? Do you ever pay a little more for things. We are not a rip off.

If there are Primerica Reps out there not servicing their soltuions, then shame on them. Shame on the State Farm, Prudential, and all of the industry. You don't like what we do then come up with a better system, hire a bunch of people to help America. You tell me to try and build a better company. I'm in Cali, let's do it!!!! You and me. Let's revolutionize the industry. I'm not married to Primerica. But I know the hearts of our companies leaders. I know the message that we teach. It's not like what you think. If people join PFS and go out and do crazy things, then they are not hearing what's being said. I accept your challenge to build a new company...if you will join me!!!!

Then how come when Anthony or one of his downline team members first contacts a potential recruit the first thing they say is "would you like to interview for a management position at Citigroup" and not "how would you like to consider a career at primerica selling stuff"?

Primerica's products are overpriced. EVERYONE makes the claim that they offer better service. Its hard to believe primerica offers better continuing service when the turnover amongst its sales force is 150% per year. Its hard for me to believe it personally when each and every policy of primerica's I have replaced the clients said exactly the same thing......"after he/she sold me the policy they quit the business and I never heard from the company again except for the monthly premium notice".

Anthony says no one is committed to giving better service than he does and has the best interest of their clients at heart like he does.Well Anthony, you make $300,000 a year at your current job. Take a week off and go out into the financial services world to see if what I am about to tell you is true or not;
You can set your business up in exactly the same way with exactly the same model ON YOUR OWN. You can offer your clients BETTER loans and BETTER insurance and more mutual fund choices than you can with primerica. You can literally save your clients 10s of 1000 of dollars and make twice as much commission for you and your downline at the same time.

Its really quite easy to offer better insurance than primerica's. There are a whole lot of companies with financial ratings HIGHER or just as high as primerica's who offer term insurance for a heckuva lot less. Prudential, Met Life, American General, John Hancock, First Colony and Protective are just a few.

Its easy to offer better loans. Getting a 7.75% loan with primerica just too have a biweekly payment plan with primerica is really silly when many many lenders will give the same person a 6% loan and do biweekly plans too. All that simple versus scheduled interest is just silly. I have a client/freind who is a math professor right there at the college in your home town. At most simple interest will save a client 30 days worth of interest of he pays each and every payment 30 days early. A 6% loan compared to a 7.75% loan will wipe out that difference in the first 30 days, then save the consumer money each and every month after that.

Anthony, you mentioned some reading we should do. Tell ya what...if you have the best interests of your client at heart then go read "Mortgage Encyclopedia: Jack Guttenberg'. Especially read pages 112-123 about mortgage scams and see how closely it resembles the primerica line about the SMART loans you sell. If you really have your client's best interest at heart, you'll go read that.

I'm a Primerica Rep and have been for about 4 1/2 years. Do I always have the best price for insurance or loans. NO! But that doesn't mean I'm a ripoff. I give great service and one-stop shopping. Many people knowingly pay a little more for more service and value. Do you always buy the cheapest gas?

I'm really sorry that you didn't have a good experience. I am aware of a good number of people who have negative experiences with Primerica. But I ten times as many who are thankful for us.

Okay, the technical stuff.

I know our loans are not competitive with most conventional loans. But some times (not most), they put a client in a better situation, especially when wrapping in a bunch of debt into a loan. It just depends on the situation. I did exactly what the consumer in this report did for one of my clients. I showed our regional loan processor the comparison of a conventinal loan to the program we were able to provide. Without batting an eye, she said we can't beat that one. I never even offer a loan if it's just a straight refy. If you can get a better loan, do it. People shop for the best solution everyday.


Our loans are tools to restructure debt. If the other companies' programs are so great, why do people keep getting further and further into debt and end up refinancing every few years? Our program is usally the last one you'll need. I tell my clients to look at the math. Either it makes sense to go with us or not. I don't know what kind of critter you worked with from PFS, but I would never influence someone to take a product or a solution that I wouldn't take for my family. (BTW, I didn't get the loan either...didn't make sense for us)

All of the big companies charge you an arm and a leg for crappy life insurance coverage. I NEVER say we are the cheapest. Most of our insurance products are competitive with other full service companies. Nowadays, you can go on the internet, which provides the least amount of service, and get some cheap coverage. You will never know your agent. Will your family ever get the death benefit? Only time will tell. Look at our ratings. We pay.

Like most American companies, we are in business to make a profit. We offer a fair service for a fair profit. Many people we help educate really appreciate our services. If you have access to better plans, than by all means go for it. I am not here to deceive anybody.

As for our hiring practices and business model. Perhaps, a little bit of understanding is required. We utilize a combination of business models that are used everyday by other industries. We have a broker agent model like what's used in real estate. We also utilize the broker model used by most investment firms. The only difference is that we give qualified folks a chance to earn income as a broker or an agent on a part time basis. Any business owner knows that distribution is the key. Your company recruits when they want to improve distribution. Because we don't have a lot of overhead, we can be more aggressive. That is the way to become wealthy. If you just wanted to sell insurance, you could have done that too. That's pretty much what I've done for the last 4 years. I sell investments too. The same investments that are available at any brokerage house Our goal is not to become financial planners. You can do that anywhere. It's about mentoring and teaching and leading others who want a shot at true ownership. Do you know that people thought franchises were a scam when that model first arrived? It was just unfamiliarity.

Now for just a little bit of defensive information. Do you even know what a pyramid scheme is? Check out Wikipedia. Look up multi-level marketing, network marketing, and pyramid. There is a difference. A pyramid, by the way, is suspicious because only the person on top makes all of the money and the folks on the bottom have no real chance at being on top. That is not Primeria...that's your job. How do you like your chance of becoming the CEO or president? Seriously, most companies are really pyramids with the employees stuck at the bottom forever. Maybe some people work for great companies with real opportunities, but people who start companies do so with the idea of being on top forever. Our company gives you a shot at owning your own company, much like someone would own a franchise.

There are negatives in every company, Primerica included. But if you understand exactly what we do, why we do, and how we do...you'll see far more positives than negatives. Perhaps you ran into the wrong representative. Trust me, I know it happens. My first encounter with Primerica was not a pretty one.

Lastly, I make over 300K on my job. I really have a great job. But, I don't have the freedom I desire. That's why I work with Primerica. I will leave my job and focus on our business sooner than later. There are other things I could do, or even just stay put. But I enjoy helping others with their finances. No one else is doing it. People are suffering and I used to be one. Again, I concede there are cheaper products out there, but you will never find anyone more committed to your families goals and dreams than me.

Did you know that Investing 1,000 a month in a mutual fund earning 12% average rate of return would be worth 1 million dollars in 20 years? THAT's Primerica. Your bank ever tell you that?

Great books to read
Cash Flow Quadrant by Robert Kiyosaki (spelling?)
The 5 Lessons A Millionaire Taught Me by Richard Paul Evans

I'm proud to represent Primerica.

Theo...of course you're right. Primerica sells overpriced prioducts. Their canned sales pitch.....also known as the Financial Needs Analysis....is designed to prey on emotions, not facts. It seeks to put up a cloud of smoke and mirrors around the fact that they charge too much for their loans. Everyone hates insurance companies so its easy to whip up a frenzy of negative emotion with lies like "you have to borrow your own money".

Everyone hates banks and mortgage lenders too so its easy to whip us a similar emotion with lies like "primerica is the only one who won't charge you a fortune to set up a biweekly payment plan".

People are prone to class envy so its easy to play on that emotion by saying "primerica is the only company who will run a free Financial Needs Analysis (FNA) for you. Everyone else will charge you $500-5,000.". The truth is the FNA from primerica is nothing more than a canned sales pitch. Similar financial analysis forms can be purchased on the internet for about 10 cents a dozen and many other companies are also willing to give you their canned sales pitch for free too and call it a Financial Profile or a Financial Horizons or some other fancy sounding name.

For 29 years primerica has used the Amway model of "buy our overpriced soap and we'll turn you in to a millionairre". The thing that makes primerica so much more EVIL is that when you pay 30 cents more for a bar of soap, you lost 30 cents....when you fall for a $MART loan, you can lose $47,000 or more.

The entire primerica system is based on emotion, cynicism, and lack of intellectual curiosity. Why anyone would listen to what one pitchman has to say about the competitors without checking it out for themself is beyond me.

A.L. Williams, the man who adapted the Amway system to financial services makes Vince McMahon look like a mortician in comparison when it came to hucksterism.