Life insurance agency pays $245,000 in settlement with Attorney General

By Roccy Defrancesco

The Wealth Preservation Institute


If you've read my articles throughout the past few months, you'll know that I think one of the most motivating topics an advisor can deal with is college planning. I think college planning is the second best door-opening tool for those looking to grow their business. If you have not checked out the 'Safe College Plan' (the only plan in the marketplace where you can use fixed indexed annuities in a totally tax-free environment to pay for college expenses), you should do so.

I recently saw a press release from the MA Attorney General's office entitled "Attorney General Martha Coakley Obtains Consent Judgment against Hingham Man and His Company Resolving Allegations of Providing Deceptive College Investment Advice." The press release is too long to put into this article, but I strongly recommend every advisor read it by clicking on the following link.

Essentially, the advisor in question, Kirk Brown from Boston, was touting himself as a "college planner." He said he could assist people with the FAFSA forms and help them figure out the best way to pay for college. College planning was the marketing gimmick Brown used to sell clients "expensive life insurance policies whose values would often plummet."

Brown allegedly "lured""victims" to seminars at libraries and told them to refinance their homes to fund life insurance policies that were supposed to be used to help the clients pay for their children's college education.

It goes without saying that advisors like Brown give the insurance industry a bad name. Nothing good comes from an advisor improperly using cash-value life insurance as a wealth-building tool.

It is for this very reason that I decided to have my company step into the college planning space to educate advisors on the proper way to use life insurance to help clients build wealth for college expenses. If you talk with many insurance companies, you'll be told that using cash-value life insurance for college planning is a great idea. I can tell you after running the numbers over and over that cash-value life insurance can work for college planning, but it is for a very specific type of client. I strongly recommend that you download a free summary to learn when cash-value life insurance works for college planning. To request a link to this Web site, please use the forum below.

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