Everyone talks about “due diligence.”
Few can define it.
Fewer still do it.
I’ve seen every version of “analysis” imaginable, and let’s just say some are more convincing than others.
Sometimes it’s an agent representing one carrier telling you, “Our policy is the best in the market.”
You can practically see the institutional indoctrination glowing behind their PowerPoint slides. Every feature aligns neatly with what they sell, and every competitor’s product has—purely by coincidence—fatal flaws.
Other times, mysteriously, the product they love is the one they’re licensed to sell, while the one they dismiss is offered by a competing carrier they can’t touch.
I’ve seen people call a spreadsheet comparison “due diligence.”
It isn’t.
That’s product advocacy dressed up as analysis.
So what does real due diligence look like?
Below are a few benchmarks.
1. Start with the Client, Not the Product
Begin by asking what the client is trying to accomplish before even mentioning a policy. The objective drives the product—not the other way around.
2. Understand the Financial Framework
Liquidity tolerance, time horizon, and risk capacity aren’t buzzwords. They define whether a product fits in the first place. Without that lens, every illustration is just sales wallpaper.
3. Educate, Don’t Indoctrinate
The goal isn’t to close; it’s to create comprehension.
A genuinely informed client can—and should—be a partner in the decision‑making process. Trust is powerful, but partnership is safer.
4. Dissect the Mechanics
Explain how the product actually works:
- How crediting rates are set.
- What the cost structures really mean.
- How the policy behaves under stress.
The math doesn’t change, but the understanding often does.
5. Evaluate—Don’t Evangelize
True analysis compares products without bias.
Every policy type—Whole Life, IUL, VUL, Term—has strengths and limitations. The value lies in understanding the trade‑offs and aligning them to client goals, not to sales quotas.
6. Model Multiple Structures
Two identical products can yield wildly different outcomes depending on structure.
Show how funding levels, loan timing, or crediting assumptions change the long‑term picture. Modeling is where unrealistic expectations go to die.
7. Run Stress Tests and Sensitivity Analyses
Illustrations are not forecasts; they’re optimism on paper.
Change one variable—a crediting rate, an expense load, a cap—and watch the ripple effect on projected values. Stress testing exposes fragility before it becomes a claim issue.
8. Use Third‑Party Analytics
Independent evaluation tools like Veralytic, LISA, Vital Signs, and ALIRT remove personality from the process. Data doesn’t care who sold the policy; it just tells you what’s true.
9. Evaluate the Carrier Too
Financial strength, historical behavior, ownership structure—these matter as much as policy mechanics. A solid product sold by a weak company is still a weak promise.
10. Identify Conflicts and Compensation
If “doing the right thing” means lower compensation, you’ve just identified your conflict of interest. Most people don’t admit that part out loud.
11. Understand the Underwriting Edge
Sometimes the best design loses because the underwriting wasn’t optimized. Knowing carrier niches can mean better classes, lower costs, and fewer long‑term headaches.
12. Create a Management Process
Define what success and failure look like before implementation.
An unmanaged policy is a future repair job. Insurance behaves over decades; “late‑stage corrections” rarely end well.
The Point
A sales presentation isn’t due diligence.
It’s marketing.
Real due diligence is slow, thorough, and uncomfortable at times. But discomfort today is cheaper than regret later.
My world is fixing insurance problems, the ones that began with enthusiasm and ended with fine print. It doesn’t have to be that way.
If you don’t understand your policy today, you’ll understand it eventually.
Just not on your terms.
Bill Boersma is a CLU, AEP and LIC and the founder and owner of OC Consulting Group. More information can be found at www.OC-LIC.com, www.BillBoersmaOnLifeInsurance.info or email at bill@oc-lic.com or call at 616-456-1000.
Securities offered through Valmark Securities, Inc. Member FINRA, SIPC. Investment Advisory Services offered through Valmark Advisers, Inc. a SEC Registered Investment Advisor.
OC Consulting Group and its affiliates are separate entities from Valmark Securities, Inc. and Valmark Advisers, Inc.
