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Preferred Is Possible For Thyroid Cancer

The thyroid is a butterfly-shaped gland located at the front base of the neck. It produces hormones that regulate heart rate, blood pressure, body temperature and weight.
 
Thyroid cancer occurs when abnormal cells grow in the thyroid gland. The incidence of thyroid cancer seems to be increasing as new technology is allowing doctors to find small thyroid cancers that may not have been found in the past. The most common type of thyroid cancer is papillary carcinoma and has a good prognosis, particularly in individuals less than 50 years old.

One of our A+ carriers takes an aggressive approach to underwriting thyroid cancer and in some cases, can offer Preferred rates.

Take a look at this case study:
  • Female, age 43, non smoker
  • Stage I papillary thyroid cancer diagnosed and treated 2 years ago
  • Completes regular physician follow ups
  • May qualify for PREFERRED Non Tobacco rates
Contact our Underwriting Team on your thyroid cancer cases and lets work together to get the offer you need!
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Cross Selling Long-Term Care Insurance

There are numerous people you know that need Long-Term Care (LTC) Insurance, many of them include your current clients. Perhaps you have already sold them a Life Insurance Policy, yet how do you get them interested in LTC?

Cross Selling can be difficult, yet when you present your client with information about LTC, they should understand the benefit of protecting themselves when they may need it.

Begin by talking about the consequences of living a long life will have on their family – and offer to put together a plan to protect them from the biggest risk they face after retirement – one that must be protected with Long-Term Care Insurance.
 
Once the conversation is going, a few good questions to ask include:
  • What percentage of your retirement assets have you set aside to pay for Long-Term Care services?
  • Are you concerned about the impact a chronic illness would have on your retirement savings?
  • If it were necessary to increase your spending by $3,000 or $4,000 a month to pay for LTC services, would that concern you?
To learn more about incorporating Long-Term Care into your product portfolio, or if you need more prospecting tips, contact your LTC Specialists today!
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How To Increase Your DI Sales

Full-Time Independent 1099 contractor groups are now eligible for multi-life discounts or Affinity Business Discounts.
 
Typically the employee must be part of an employer group, work full-time, and receive W-2 wages to qualify for a multi-life discount.

Now, small groups of 3-14 employees and contractors can qualify for an Affinity Business Discount without any employer sponsorship and receive only 1099 income.

Who is eligible?
 
Under the Business Affinity Discount Guidelines, eligibility is available to groups of 3 or more individuals applying at the same time who are:
 
  • Employees and/or 1099 contractors under a common employer
OR
 
  • Are members of a local professional employer organization
Each applicant must have an issue age of between 18 to 70, and Occupational class of at least 3A. The launch of the Business Affinity Discount makes now a great time for you and your clients to discuss the exceptional benefits of Disability Insurance at an even better price.
 
The following professions also represent potential sales opportunities:
  • Accountants
  • Independent Insurance agents part of an agency
  • IT Professionals
  • Real Estate Agents
  • Consulting Groups
Please contact your Disability Income Sales Rep for additional information.
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Tax-Efficient Income And Principal Protection With Annuities

With the Federal Reserve’s interest rates at a 15 year high, fixed-rate annuities continue to offer the best tax-deferred guarantees available. A 60-year-old with $250,000 in after-tax funds can secure a guaranteed growth rate of 5.65% for 10 years — an excellent, fully guaranteed rate.

Annuity products also serve as an income source. By withdrawing interest, that same 60-year-old could generate $14,125 in gross annual income while preserving their initial $250,000 investment. After accounting for a 35% tax bracket, the net income would be $9,181.25 per year. While this is a solid option, a more tax-efficient approach can further enhance income using a split annuity strategy, which combines a fixed deferred annuity and a single premium immediate annuity (SPIA).

A More Tax-Efficient Approach

By strategically dividing the $250,000 investment:

  1. $144,292.90 is placed into a fixed deferred annuity at 5.65%, ensuring it grows back to $250,000 over 10 years.
  2. The remaining $105,707.10 is used to purchase a 10-year period certain SPIA, leveraging favorable exclusion ratios to minimize taxable income.

This SPIA generates $12,943.68 per year, with 82% of the income excluded from taxes as a return of principal. After taxes, the net annual income increases to $12,128.23, providing an additional $3,000 per year compared to simple interest withdrawals—all achieved through smart tax planning.

Maximize Your Clients’ Tax Efficiency

With tax season approaching, now is the time to introduce clients to strategies that optimize income while preserving wealth. Contact us today to explore more tax-efficient solutions that capture your clients’ attention and help them make the most of their financial future.

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Avoiding Transfer Tax Without Transferring Control!

In one household a quiet and uneventful afternoon ended abruptly with this conversation:

Young son: “Hey, Mom. You know that valuable vase that’s been handed down in our family from generation to generation?”
Mother: “Yes, why?”
Son: “Well this generation just dropped it!”

Many high-net-worth clients have enough wealth to make large current gifts without affecting their current lifestyle. They anticipate leaving the full lifetime exemption amount to heirs at their passing but are tempted to make an untaxed $13,900,000 transfer before the exemption is reduced by 50% on January 1. The larger protected gift could easily save their estate more than $3,000,000 in death taxes down the road.

They don’t need the money, but still hesitate. So where’s the rub. In fact, there may be two rubs: affection and control. The assets transferred, often a family business, are labors of love which the donors want to continue to protect, at least during their lifetime. To follow the analogy, if the kids are gonna drop the valuable vase, they don’t want to see it happen.

A planning alternative that offers the best of both worlds, freeing assets from taxation while keeping control over them, is the Family Limited Liability Company (FLLC).

Here’s how it works:
  • Asset depository – An FLLC is formed and houses the assets to be transferred. Again, those assets are usually the ownership interests in an ongoing family business.
  • The haves and the have-nots – The FLLC is structured with both voting and non-voting interests. The percentage of the divide is flexible, often as extreme as 1% voting and 99% non-voting.
  • Selective gifts – Transfer of only non-voting interests is made to the heirs. If voting interest is transferred it is not enough to lose control of the FLLC.
  • Loss of income? – The donor gets no equitable return on the transferred interest, but this can be partially offset by receipt of compensation for managing the FLLC.
  • Magnifying the exemption – Because the interest is non-voting, its value can often be discounted for gift purposes, thereby expanding the effectiveness of the exemption amount.
  • Even more control? – If the donor doesn’t want to give direct ownership of the non-voting interest to heirs, the transfer can be made to an irrevocable trust for the benefit of the donees.

If an FLLC is a solution then its creation and implementation take time and an attorney, both of which will be in increasingly short supply as the New Year approaches.

Call with questions concerning your client’s FLLC planning or any taxation, business or estate issues that arise in your casework, to Tom Virkler at 706-614-3796 or tom@cpsadvancedmarkets.com.

For what it’s worth: When Gene Johnson lost her sister in 2010, it was left to Gene to clean out her London home where a vase was displayed on a shelf, a dusty souvenir from a trip to the Far East in the 1930s. Experts determined that the antique, now known as the Chinese Jiqingyouyu Reticulated Vase, was a product of the 18th century Qing Dynasty. Its last sale to a private buyer was two years later for $32,800,000.

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Extended Shelf Life Of Medical Requirements Can Help Boost Your Sales!

The idea of getting your client examined for life insurance can be a challenge.

Asking for a second exam after one was done in the not so distant past can jeopardize a sale. Worry no more.

Consider the following:
 
A 70 year-old female applied for $10 million of life insurance coverage with another company, was approved, and the policy placed in-force over six months ago. She now desires additional coverage for the same amount, but does not want to go through another exam. Her previous exam, lab and resting EKG were completed over nine months ago.
 
Many of our A-rated carriers will accept the older requirements for up to 12 months, so your client does not have to be inconvenienced by scheduling new testing as long as a non-med part 2 is completed along with the application.
 
Another of our carriers has some other special guidelines they follow: They can use another company’s inspection report for up to a year; and for those clients ages 70 and older, they can accept cognitive testing previously done for up to one year in addition to resting EKGs and inspection reports – although they will need a new exam and labs after a 6 month time-frame.
 
Take advantage of these guidelines when you can, give us a call to discuss the details of your cases – the Underwriting Department is here to help.
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Help Clients Hedge Their Risk

Highlighting the cost of care can be a powerful, yet non-threatening way to engage clients in a Long-Term Care (LTC) planning discussion. It also can provide a convenient starting point for designing a policy that will meet your client’s needs and budget.

Since the future estimated average cost for multiple years of care can be quite high, it’s important that both you and your client don’t view LTC Insurance coverage as an all-or-nothing proposition.

Highlight The Cost Of Care
 
First, discuss with your clients where they would like to receive care should a Long-Term Care event arise. Based on their response, show them what the estimated cost of three or more years of care is today and in the future.
 
We can help you and your client explore the cost of care, including:
  • Current costs for Long-Term Care for all areas across the country
  • Estimated costs for LTC events lasting 1-10 years
  • Projected future costs for Long-Term Care based on inflation
Develop a Strategy
 
Once your clients have seen the financial impact that a long-term event can have on their assets, help them develop a strategy to insure some or all of the risk. Base your plan design on what you know about your client’s financial goals, and adjust your recommendations based on their budget concerns.
 
Some clients may be willing to insure part of the risk by paying a portion of their future expenses out of pocket. Others may prefer to protect all of their assets, to ensure a spouse/partner’s financial well being or to leave a legacy to their children. In either case, LTC Insurance can provide a significant level of protection.
 
Manage the Premium
 
You have a surprising amount of flexibility when designing an LTC Insurance policy. If you start with a policy that accounts for your client’s total estimated future cost of care, be sure to consider alternate plan designs that help to lower the premium, if needed.
 
Consider this approach:
 
If you started with a longer benefit period and compound inflation, consider shortening to 3-5 years to save money, while still providing ample coverage for most care needs. Leaving off compound inflation protection can make a big impact, potentially cutting the premium in half. With this strategy, consider a higher initial daily benefit to account for future cost of care increases.
 
Become a Resource
 
Become a “cost of care” expert in your community. Leverage us as a point of reference in your prospecting efforts. After seeing the potential impact that an LTC event can have on their assets, your clients may feel compelled to protect their future with LTC Insurance.
 
Contact your LTC Associate today for more information and resources.
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5.82% Investment Return “Equivalent” Guaranteed

Some clients may understand the need for Disability Income Insurance, but still resist purchasing because they don’t want to “lose” those premium dollars if they never use the coverage.

For many, the purpose of buying Disability Insurance (DI) is so they can sleep at night knowing if they get sick or hurt one day everything will be okay financially.

But what if nothing serious happens to your client during their working lifetime that prevents them from working? They have paid premiums to a policy for years that never was used. Having some peace of mind may have a cost, but there is a way to mitigate that cost.
 
There are income protection plans available with return of premium options that pay back the premium to your clients (income tax free).
 
This is how it works:
  • A 39-year-old male Real Estate Agent earning $110,000 qualified for an Income Protection Plan that would pay him $5,000 each month (tax free) if he got sick or hurt and could not work.
  • The premium for the coverage is $123.39 per month.
  • If he reaches age 67, his total premium paid would be $39,257.96.
  • If he adds the Return of Premium Advantage the additional cost would be $81.43 per month for a total premium of $204.82 per month.
  • At age 67 with no claims being paid, the Real Estate Agent will receive a check for a tax-free amount of $65,168.32 – which is the investment return equivalent of 5.82% guaranteed* on the additional $81.43 monthly premium.
This “money back DI” solution can be offered on a long-term or even short-term policies. One option of the return of premium rider provides a lump sum return of a specified percentage of the premium paid even before age 67 should the client decide they no longer need income protection coverage and want to cancel the policy .
 
Reach out to your clients to find out if they have been reluctant to purchase individual DI coverage because they feel they would be throwing money at a policy they will never use. Although policy premiums will be higher with the return of premium option, emphasize the “value” of being able to use the returned amount any way your client wishes – perhaps a lump sum payment on the mortgage or add to their retirement fund.
 
Contact your Disability Income Specialist with any questions or if you would like to see a proposal for yourself.
 
*The IRR will vary subject to clients age, occupation, and benefit amount.
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Charity Begins At Home, Not At The Carrier

Director Francis Ford Coppola leaves us with a cold and calculating Michael Corleone looking out the windows of his lake house over the water that would prove to be the River Styx for his brother. What is to be a day of relaxation and fishing for Fredo will end in the fulfillment of Michael’s directive for the execution of a sibling who he deems unfaithful to him and the family.
 
In audience time it is 16 years before we meet the Don again in the opening scene of The Godfather: Part III. In contrast to the sordid power-brokering that goes on in the initial wedding and baptism sequences of the first two films, we find an older, reflective Michael on a path for respectability, legitimacy and eventually some sort of moral absolution.
 
In a grand ceremony at St. Patrick’s Cathedral he is being inducted as a Commander in the Order of St. Sebastian and viewers soon learn that there is probably a connection between that honor and a $100 million gift to the Church from the Vito Corleone Foundation, a charity run by Michael’s daughter.

The film only serves to fuel the suspicion we often have of those who seem too charitably minded; a suspicion that is understandably shared by insurance carriers.

Back in the olden times as states began passing laws giving charities an insurable interest in the lives of donors, it wasn’t much trouble getting a significant amount of charity-owned coverage on the life of a person who intended to donate the premiums each year to the organization.
 
The problem arose when an invigorated life settlement marketplace created an attractive non-correlated asset class and groups of independent investors arranged for charities to buy coverage on donors paying the premiums and anticipating returns for all involved when the policy was sold later on in the secondary market.
 
Once everybody figured out what was going on a couple things occurred…
 
First, applications began containing questions addressing intended use of coverage, particularly regarding possible transfer of interests in the contract after the sale. And, second, the liberality of financial underwriting for charitably-owned coverage was dramatically proscribed.
 
A recent survey we conducted of major carriers revealed that the starting point, and often the finish line, for the amount of death benefit they would entertain was only ten times the annual donation pattern the insured had with the charity; i.e. if Benjamin Bear has been giving $5,000 a year to the Bruin Varsity Club, he is only good for $50,000 coverage to leverage his legacy – hardly a gold mine for some insurance advisor alumni trolling the membership list.
 
One carrier would allow twenty times. Another permitted the projected value of the pattern of giving for 75% of the donor’s life expectancy.
 
The fields are hardly white for harvest if an insurance advisor intends to get rich selling charitable-owned coverage. Nonetheless, there are circumstances where carriers may look beyond the donation-multiple standard.
 
By the way, both The Godfather and The Godfather: Part II won the Academy Award for Best Picture. The Godfather: Part III was nominated, but denied, the award going instead to the Kevin Cosner film Dances with Wolves. The American Film Institute ranks The Godfather #2 among the best motion pictures in American cinema, second only to Citizen Kane. Also, UCLA has won more NCAA championships than any other school. You can look it up!
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Maximum Future Flexibility – Cash Value Life Insurance

Life Insurance products are designed to protect risks from being transferred to an undeserving party by having a group of individuals pay premiums to reduce the overall cost of mitigating these risks.
 
This is seemingly the base definition of the purpose of insurance, but there are additional caveats based on the specific design of the products.

The market has been repositioned in recent years to be geared toward guarantees with traditional no-lapse features built into policies.

During this market shift there was a product line that was forgotten, Cash Value Life Insurance.
 
The initial advent of Universal Life Insurance promulgated the concept of access to cash value and maximum future product flexibility.
 
The current interest rate environment is at a 40-year all time low and individuals are looking for creative ways to achieve the highest return on their money. The cash value products provide an alternative savings account and provide great flexibility to prospects when looking to supplement retirement benefits from a pension, 401(k), IRA or any other existing retirement vehicle within their portfolio.
 
The cash value is also another source of capital for an emergency fund for an uncertain future medical expense, or these values could be used if a unique business opportunity that would not have been available to the policy owner otherwise.
 
If the policy owner’s experience financial hardship they are able to adjust the policy to keep their coverage intact.
 
One of the most prevalent features is that the policy owners reserve the right to skip premiums if the cash value is great enough to cover their obligation. This reduces the possibility of lapse or reinstatement, which can be a cumbersome task for the client to complete.
 
This is a concept that should be discussed, because the traditional guarantees might not be flexible enough to meet client objectives in a financial environment that is new to even highly sophisticated advisors.
 
Contact Us
 
We want to help you provide the most comprehensive insurance planning to your clients and put you in a position to grow your business. For more information on the cash value products please contact your Life Sales Marketing Manager today and ask about our Policy Review Program!

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