Wednesday, July 11, 2007

Some misconceptions about Primerica

Here are some of the misconceptions that some people say about Primerica. You have to know that most of the hatred that people have against Primerica are agents from other companies. Primerica teaches clients about keeping life insurance and savings separate. By keeping them separate, this lower the cost for life insurance and increases the rate of return on the savings. Other companies rather bundle life insurance and savings together. By bundling them together, the premiums are higher and the rate of return on the savings is very low. Who you think the client is going to side with? Primerica or these other companies? Primerica because the client sees more value by keeping life insurance and savings separate. So this is one of the main reasons you may see things on the internet or hear bad things because nobody likes having Primerica taking their clients away.

Here are some of things I read online. Keep in mind the internet is not regulated and anyone can post whatever they want. If you want the truth about Primerica, go to the company directly and get your answers from there.

1) Primerica is a scam. I've been in this company since August 2004. There is nothing about Primerica that makes it a scam. I have a state life insurance license and a state mortgage license. I have a federal securities license. If Primerica was a scam, the state and federal government would not issue these licenses. Primerica been in business since 1977. After 30 plus years, do you truly think Primerica is still a scam?

2) Its a pyramid. Frankly, I don't understand what a pyramid is. Most people who say its a pyramid can't even explain it themselves. What is a pyramid??? It is one of those Egyptian things? Its not a pyramid. Its a business opportunity. In a pyramid, you are usually stuck at one level and the chance of you moving to the top is very slim. At Primerica, its an upside-down pyramid. In the beginning, you make very little or no money. As you gain more experience and put more effort into it, your income is unlimited. You can make as much money as you want. At a job, isn't there a salary cap limit? You may be the best employee in your department, but you are still getting paid the same as the worst employee in your department. The only difference is you have a better chance of keeping your job while the worst employee may get fired. At Primerica, the more experience you have, the more money you can make. If you work really hard and build a large team, you can earn more money than your upline. The fact that you are able to make more money than the person who recruited you proves that Primerica is not a pyramid. At a job, are you able to a higher salary than your boss? Of course not. Because your salary is base on position, not on the person. At Primerica, your income is base on how hard your work.

3) Its a pyramid scheme. The only reason why someone would think that is because they saw the $199 and didn't understand it. They either think its a job opportunity and no one should be paying a fee to get a job OR the recruiter will earn commission on the $199. This is not a job opportunity, but a business opportunity. There is a difference between the two. A job is where you build someone's else business. A business opportunity is where you get to build your own business. The $199 that people see is the state licensing fee. While the actual cost of the state license is more than $199 (about $100-$300 more), Primerica pays the difference. If you want to build a business, you have to show your commitment that you are serious about building your business and Primerica will show its commitment to you by giving you the best support system they have. So no one in the company is making profits off the $199. The company is actually making a loss by paying most of the licensing fee for you.

4) Primerica products are expensive. If you were the client, you wouldn't be saying that. But an agent from another company will. I don't see how Primerica products are expensive. If they were expensive, how would anyone afford it? If you comparing life insurance, I think Primerica's term insurance is competitive to the rest of the industry. Is it the cheapest? I don't know. There are so many life insurance companies out there. But when you compare term insurance to cash value life insurance, term insurance is the cheapest. When comparing term insurance to term insurance, you have to compare the type of term insurance is it. Are they both the same level term? Or is one just an annual renewable term and the other is a level term? What happens at the end of the term? What features does the term policy has? What are the riders attached to it?

If you are comparing loans, there is no way that other companies can compete against Primerica. Primerica loans are customize debt solution loans that show clients on how to get out of debt sooner and for less money. If you take a few years off your debt, this would save you thousands of dollars on interest payment. You go ahead and try to find other companies that will do this for you. They rather keep you in debt for the full length of the loan rather than have you pay it off sooner.

5) Primerica's mutual funds suck. First of all, Primerica doesn't own any mutual funds. Primerica markets mutual funds for other companies such as Legg Mason Partners, Fidelity Advisor, Van Kampen, Pioneer, AIM, American Funds, Alliancebernstein, MFS, Oppenheimer, Putnam, and Franklin/Templeton. Majority of the mutual funds offered by these companies are rated 4-5 stars by Morningstar. Saying Primerica's mutual funds suck is really saying, "all these mutual fund companies suck." If you think so, then you shouldn't be investing at all. But I'll tell you this, all wealthy people invest their money. They don't keep lots of money in the bank account.

6) Primerica got sued. In the beginning, Primerica was called A.L. Williams. We were only able to sell 20 year term insurance. Since the company was replacing cash value life insurance policies, almost every single life insurance company were suing A.L. Williams. No one likes having their clients taken away by another company. These companies even made death threats to Art Williams. That's how bad it was in the beginning. In the 1990s, many life insurance companies got sued by the United States Government from deceiving and lying to consumers about cash value life insurance. Being sued by the government is worse than being sued by another company. Many life insurance companies haven't been able to recover from these fines, so they either closed or merged with other life insurance companies or another life insurance company bought them out. Other companies pay off the fines by selling shares to its current policy holders. If a company says it will give dividends, then you know that company was sued by the United States Government. As for Primerica, they were not affected by the ruling because we sell term insurance 100% of the time.

7) Primerica was fined by the SEC. There was just one incident where 4 agents in the same office were involved in a Ponzi Scheme from 1991-1994. They were selling unregistered securities (investments not offered by Primerica), which is completely prohibited by Primerica. Primerica has failed to supervise and resolve complaints against these agents, so the SEC fined the company in 1998. Since then, Primerica has made lots of improvements in supervision and constantly keeping agents informed about the rules and regulations.

To make sure all securities licensed representatives follow SEC laws and regulations, Primerica holds annual compliance meetings. If representative fails to attend the meeting, he/she would lose his license. Primerica even sends quarterly newsletters reminding agents some of the rules and regulations and puts updates and notices on website.

In the past 4 years, Primerica has the received the Dalbar Service Award for its top notch customer service in mutual funds. Dalbar, Inc. is a client service rating organization focused on raising the standards of customer satisfaction and quality in the financial services industry. Dalbar develops ratings for: Mutual funds, brokers/dealers, life insurance, and more. Would you rather do business with a company that has the best customer service or a company that puts you on hold or transfer you to some tech guy in India? Primerica's customer service are all located in the United States. The company has made its number one priority to resolve all issues and concerns as soon as possible. I even call them a few times and within a few minutes, all my concerns were resolved.

8) Primerica rips people off. I don't know how that is even possible. Would you rather pay $2000/year for a whole life insurance or just $1000/year with Primerica's 30 year term insurance? Would you rather be in debt for the next 30+ years or be in debt for just 20 years with Primerica's SMART loan? Would you rather pay 2% annual fees on your mutual fund or just 1% with most of mutual funds offered through Primerica? Would you rather go on with life without any financial plan or get a free financial need analysis at Primerica? Did you see anything here that can rip people off? I didn't and I've been doing this for many years. Its those other companies that actually rips people off. Primerica goes in and helps the client save money and build wealth. Other companies focuses on making profits. If they advertise, they spread the cost of it to its consumers. Primerica has not spent a single cent on advertisement, that's why the company is able to keep it costs to the minimum.

9) Majority of Primerica's agents don't know anything about finance. In the beginning, most of them don't. That's why there is a system in place to help train these agents. When a new agent goes out in the field to see a client, he/she always bring a field trainer. The field trainer does all the work, while the new agent watch and learn. Eventually, the new agent will become experienced enough to go see clients on his own and soon be qualified to become a field trainer. Most of the offices hold weekly training to help agents learn about the different types of financial products out there and learn how to build a business. At Primerica, you don't need a college degree. A college degree doesn't mean anything in real life. It just shows you are willing to work hard to earn more money. But if you are not experienced, most companies won't even hire you. When someone says Primerica agents are not educated or not fit to work in the financial industry, the truth is we actually know more than 95% of the population. We know everything about life insurance. We know everything about mortgages. We know everything about mutual funds. We know everything about how money works and how you can have money work for you rather against you. The average person doesn't know any of this stuff. Other agents from other companies can't even comprehend half the stuff what a Primerica agent can do.

In closing, people can say whatever they want about Primerica. Some people been saying bad things about the company for over 30 years. But you know what? None of these things affect Primerica. In fact, it made the company even stronger. Where does the competition stand? While all our other competitors have gone stagnant or losing their sales force, Primerica continues to grow its sales force and build a larger client base. Primerica is a strong financial company and is in position to dominate the financial industry. There is no other company that can match what Primerica can do. They are able to do parts of what we do, but they don't fully do everything for their client.


Sarah said...

Very well said and accurate! Kudos for clearing up any confusion or misconceptions people may have about Primerica!

Anonymous said...

Thank you SO much for clearing all of this up! My boyfriend just got a job offer with Primerica yesterday, and during the interview the company seemed almost too good to be true. I did some googling and started to worry when I saw the numerous scam claims, but not anymore. Now all is clear, I just hope he gets the job! :)

Anonymous said...

I wish people would not just google the name primerica but infact google because that is the only way to know about the company. everyone has a bad expierience with something in there life but that does not mean that is how it will be for you. I think this is a awesome article and think we need to get more stories out there about the families we help and the changes we make in there life not so much about what it takes to succeed in Primerica. I would rather show interest in a company that helps families then ask myself how can i get involved with that. This is a great company to work for IF it is for you. It take hard work strength and determination but it pays off.

Primerica said...

Primerica went public in April 2010. Look at all the research that went into this undertaking. The SEC, FINRA and other government agencies as well as all the anchor investors and mutual fund companies. For those who live for a JOB and know little about real business keep using Google for research and you can remain ignorant. But do some real research and you will find it is a successful and proven business model. It is a pillar in the most tightly regulated industry in the world. No MLM here!!

Donald said...

Outstanding rebuttal to all the negative out there in the digital High School land. I have been building my business (remember it's not a job, it's your business. PFS works for you) for 2 months. I won't go back to Corporation. People should check FINRA, BBB, and RipOff Report when doing research on a Company, not google.

Anonymous said...

Its funny that people who work for Primerica say "Oh well anyone can post something on the internet" well yea that includes people who work for Primerica can go on and post all positive things even if they are fabricated just so people would see it and believe. I'm not arguing its legitimacy. I'm just stated a fact that anyone can post anything and it works both ways. And if you do extreme research you will find that people who have negative things to say will explain them in extremely accurate detail where as people who say positive things just say "its a great business opportunity that everyone should give a chance"

Anonymous said...

I have had several clients that had great dividend paying whole life policies and even some that were fully paid up. PA came in and tricked them into cancelling the permanent policies to go with term insurance. Problem is once you outlive the term, the tax free estate has vanished and the poor people are screwed. Moving money from permanent policies with a strong company to plain old term and hope the mutual funds don't crash is disingenous and risky.

Anonymous said...

To the whole life agent, the tricks is the pennies on the dollar "cash value" of policy you're selling. I wondered if your clients were ever told that depending on the types of policy you sell, if they were to expired they are only entitled to either the face value of policy or the cash value components but not both! The poor people you sold your products to have a better chance with their money invested in mutual funds than in your policy because your cash value is worthless! Do you even own what you sell?! I bet you don't if you understand finance and the value of investing.