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Non-Reportable, Tax-Free Income During Retirement By Using Index UL

There aren’t many investment vehicles available that offer the tax advantages of properly structured, permanent life insurance. Unfortunately, many clients are not aware of those benefits when purchasing term insurance, and they may not know about alternative product solutions.

Within your existing book of clients, do you have any individuals who are hitting the contribution limits in their qualified plans?

If so, Index Universal Life (UL) may be a great concept to introduce to them in your next meeting, as it can provide a number of benefits that are comparable to a qualified plan.
 
The following series of questions can be used to frame the benefits of Index UL, without specifically introducing the concept of life insurance:
  • Do you believe that taxes will be static, or fluctuate over your lifetime?
  • Are you contributing to any qualified retirement plans? If so, are you funding to the maximum limits of those plans?
  • Would you be willing to trade the benefits of interest crediting in order to remove the risk of losing accumulated values, due to downturns in the market?
  • Do you mind paying taxes on income that you receive from your non-qualified assets?
Many of your clients will meet the contribution limits in their qualified plans; believe taxes are only going to increase; will not like exposure to loss of accumulated values due to downturns in the market, and will not like paying taxes on their distributions.
 
All you need to do next is ask them is how much they would like to contribute monthly for a vehicle that has.
 
  • No contribution limits
  • No downside market risk
  • Compound interest crediting in the 10-12% range annually, without the possibility of losing their accounts’ value due to negative returns in the market
  • Non-reportable, tax-free distributions of their accounts’ accumulated value
Once your clients provide you with a premium commitment, we will help you to assess their insurability, and prepare proposals that solve for a minimum death benefit and provide the most efficient cash value accumulation.
 
Ideally, Index UL policies should be funded for 10-15 years prior to taking policy distributions, but they can be customized to meet many different specifications depending on your clients’ age and preferred premium schedule.
 
This strategy is not limited to clients who are maximizing their qualified plan contributions.
 
Index UL can be an efficient solution for younger clients (ages 30-50) who are looking to further fund their retirement, prepare for a child or grandchild’s school tuition costs, or contribute discretionary income into a product with the tax favored features mentioned above.
 
We will help you identify clients within your existing database who would be good prospects for this strategy, and will create customized solutions to meet their needs. To learn more about the Index UL products that are now available, and to explore how they can drive new sales opportunities – call your Life Sales Rep today.
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How To Convert On 75% Of Your Sales Opportunities

Providing a needs-based analysis to customers helps them understand how life insurance can work for them and their families.

Three-quarters of shoppers who received a needs analysis bought life insurance.

When a needs analysis was not completed, less than half of the prospects purchased life insurance. A needs analysis will help identify the true amount of coverage necessary. It will ensure all of the client’s concerns and objectives are addressed and remove any uncertainty concerning whether they may be over-insured or under-insured.
 
It also provides you with greater insight as to the specific financial challenges that your clients are facing and open the door for you to recommend solutions for life insurance and other product lines that can help them protect their financial futures.
 
The Cross-Selling Opportunity
 
If you are not a Life Insurance Specialist, these fact finders can help you to cross-sell life insurance to your existing clients and businesses. You have a dedicated team here to help you through each step of the sales process.
 
If your core business practice is life insurance and you do not currently implement any fact finders or a needs analysis in your sales process, ask yourself if you are converting on 75% of your client opportunities?
 
We have a number of marketing pieces to help identify the proper amount of personal insurance coverage in a traditional family structure, domestic partnership, special needs planning situation and even in the business insurance marketplace.
 
Contact us today to learn more!
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The Shocking Truth About The Average American Household

Losing a loved one can be devastating to a family, both emotionally and financially. While it is almost impossible to prepare for the emotional challenge of death, it is much easier to prepare for the financial challenge when adequate life insurance coverage is in place.

More than half of Americans believed that they would feel the financial impact from the loss of the primary wage earner within six months.

This doesn’t just speak to households where there is no existing life insurance coverage in place.
 
Consider:
 
Over one quarter of consumers who already own life insurance feel that they do not have an adequate amount of coverage.
 
As life insurance agents, staying in regular contact with existing clients helps to ensure that the amount of coverage in place is commensurate with changes in their lifestyles.
 
Many life events such as marriage, divorce, the birth of a child, changes in employment or the purchase of property will trigger a change in the insured’s need for life insurance coverage. When your clients are going through these experiences, their life insurance coverage is often not at the front of their mind.
 
We have tools available for your immediate use to simplify the regular review of your clients’ existing coverage, including customized kits for both you and your clients!
 
Call your Life Sales Rep today to learn more about the resources available.
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6 Core Needs Of Business Clients – And How We Can Help

Are you talking to your clients about Business Insurance? If not, you may feel that it would take years to become an expert.

We can help you provide free business evaluation services to your clients today!

We will help to address your business clients’ six core needs:
  • Retirement Income
  • Exit Planning
  • Income Protection
  • Business Protection
  • Wealth Transfer
  • Survivor Income
A sales associate will work with you to provide business case expertise and top-notch service before, during and after the sale! We will help you navigate through the planning process.
 
The process includes, but is not limited to:
  • Learn the Business Planning Services Approach
  • Learn whom to approach
  • Learn to build marketing campaigns
  • Help clients find the value of their business
  • Help clients review their buy-sell agreements
  • Help clients understand the reports
  • Help clients create an action plan
Working the process thoroughly will help your clients gain perspective on the value of their business, and identify any planning opportunities in their current buy-sell arrangements. Contact us today to learn more about this comprehensive service.
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Are You Following Up on Your Term Sales?

Term Insurance is often sold to clients who simply want the lowest cost death benefit protection for a specified period of time. Clients and producers alike will preach the concept of buying Term and investing the savings.
 
While we’d like to think that clients and the investors hold themselves accountable for this strategy and do invest their cost savings, we know it is more likely that the clients pay for the Term coverage and then spend their savings elsewhere. The Term Insurance is then forgotten over time only to be revisited once the level Term period has expired and the client does not want to pay the escalated premium.

One way to help your clients effectively plan for their long-term needs is to discuss the Term Conversion option.

Consider this:
 
By completing a conversion application, the client can change their coverage from a Term plan to a Permanent policy without any additional underwriting. This is usually allowed up to a certain age (commonly 65, 70 or 75 depending on the provider). The cost of these conversions is based on the insured’s attained age at the time of the request so the longer your client waits to exercise their conversion option, the more expensive the premium will be.
 
This should be a topic that you address with your clients on a regular basis to ensure that you do not let the conversion privilege expire and also that you are converting at the earliest, most appropriate time which can save your clients significant premium costs. It will also ensure that your clients have the coverage in place when they need it most – when they pass away. Since the average life expectancy is in the mid-80s, more often than not, the level Term policy will expire before your client expires.
 
Ask yourself if you have a process in place to address your clients who have purchased Term Insurance. Even if converting their Term plan isn’t the most appropriate course of action at this time, the review discussion may uncover additional needs for insurance or lead to referrals.
 
We can help you determine if your client’s Term plan has a conversion option and provide you the marketing support needed to turn these cases into permanent sales.
 
If you have any clients that may be approaching their conversion deadlines or who may be appropriate prospects for a policy review, call us and we can help get the process started for you.
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A Valuable Tool For Supplementing Retirement Income

Clients and prospects increasingly understand the need to supplement their retirement through their own savings efforts – as Social Security and company sponsored pension plans may not provide sufficient income for their retirement goals.

Qualified plans such as 401(k)s are an excellent way to save for retirement, but they are limited and are only available if provided by an employer.

Traditional IRAs and Roth IRAs also offer additional saving opportunities, but individuals must meet specific income and contribution limits in order to use these qualified accounts. As a result, clients and prospects need help finding additional solutions that will help them fill the retirement income gap.
 
Your clients recognize that they need to save as much money as possible, as soon as possible, in order to secure their financial futures. Fortunately, you are well equipped to help clients address their retirement income needs by relying on the knowledge and expertise available to you.
 
Life Insurance, properly structured, can be a valuable tool for clients to supplement their retirement planning efforts.
 
During their working years, death benefits provide cash when it is needed most – but these funds can be used to decrease debts and replace income so that loved ones can maintain their standard of living.
 
At retirement, your clients can access policy cash values via tax favored withdrawals and loans. In addition to these benefits, clients can also choose to add a long-term care rider that will provide valuable benefits should they have a qualifying long-term care expense.
 
For more information about how you can help your clients address one of their biggest financial challenges, while securing valuable protection against an untimely death or devastating long-term care event, please contact your Life Sales Rep.
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Why Gifting Matters to You

Gifting is an important tool in designing many types of Advanced Markets cases. Gifts can create opportunities but may also generate complications for producers and clients.
 
Questions you may be asking are, “How will knowing more about the gift rules help me in my career?” or “How will gifting help my client achieve their goals?”
 
Because your clients have the opportunity to realize significant financial and emotional value in making gifts, you will want to be knowledgeable about gifting. The financial and emotional value clients experience through gifting can be enhanced with Life Insurance.
 
Generally, it’s not difficult to convince clients that they need insurance, but it’s hard to find the money to pay the premium.

Gifting may be the answer for getting the necessary premium dollars.

With Life Insurance, gifts serve a similar purpose. A client may gift cash to an adult child so that child may purchase a policy on the parent/giver. When the giver dies, the child receives a tax free death benefit that can pay for services or items that the giver may have previously supplied.
 
Consider This
 
For example, a father has three children, but only two of whom have interest in owning real estate that has been in the family for generations.
 
To equalize his estate, the father gives cash to the non-business heir, Jill, so she can buy a Life Insurance policy on him. At the father’s death, the real estate can move to his two children that are interested in owning it, Jill receives cash from the policy’s death benefit while keeping the death benefit out of the father’s taxable estate.
 
Regardless of whether the gift is given for financial or emotional reasons, gifting can be a big part of a strategy to get clients closer to their desired goals.
 
For more information about gifting call your Life Sales & Marketing Representative.
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An Affordable Alternative To Estate Planning For Hesitant Clients

In today’s economy, some of your wealthier clients may be hesitant to purchase Survivorship Life Insurance coverage due to uncertainty, either in the market, estate taxes or their family’s circumstances. There is another way to cover their insurance need without the finality of a Survivorship plan or the cost.

We have contracts with carriers who offer the ability to convert Individual Term Insurance policies into a Survivorship plan during the designated conversion period.

Your clients receive immediate insurance protection while locking in their underwriting class. This approach requires less of a commitment coming out of your client’s checkbook while satisfying the total insurance need.
 
The policies can be owned individually or by an Irrevocable Life Insurance Trust (ILIT) and down the road they will have the ability to convert into a SUL plan at attained age if the uncertainty regarding estate taxes and the current market condition erodes.
 
Items to keep in mind when considering using an ILIT to purchase Term coverage.
 
First, if you use a trust, the individual who is not covered by the Term policy will need to provide evidence of insurability when the policy is converted to a SUL plan. Second, you could have the trust purchase half of the total insurance need on each spouse.
 
Using this method, the individuals will be able to acquire the total insurance need without showing proof of insurability at the time of the policy change.
 
If you have clients who are hesitant to address their estate planning needs and are taking a “wait and see” approach, you may want to introduce this strategy.
 
Our Life Sales & Marketing Associates can show you which carriers Term policies can participate in this concept and prepare quotes showing the most affordable options.
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Business Continuation Planning

Small business owners often wear many hats – they are HR, IT, Senior Management, and Operations all-in-one. Being a small business owner can be tiring and time consuming.
 
Appeal to this market by presenting them with a simple plan – so they can have peace of mind knowing their family and business will be in good hands when they move on.
 
Help business owners prepare for the future by using a Buy-Sell Agreement.

71% of small business owners surveyed said they have thought about who would run their business in their absence, but only 35% of all surveyed had a business continuation plan.¹

Many business owners don’t have formal plans to transfer their business to a successor in the event of retirement, disability or death. A business may fail due to confusion and lack of a clear plan after such an event.
 
As a life insurance professional, you can help business owners create a continuation plan using life insurance policies.
 
How you can help Business Owners with Life Insurance:
  • Establishes a guaranteed buyer at the time of the triggering event
  • Sets a price for the business when the business owner is less vulnerable and ensures the business will be sold at a fair market value
  • The surviving business owner(s) won’t have to run their business with the deceased person’s family members (if they choose not to)
  • Provides liquidity, when the family needs it most, to fund the sale of the business to surviving partner(s)
We will help you prepare business valuations, design the proper life insurance proposals – give you the tools to become a business insurance expert.
 
Contact your Life Sales Representative today and maintain a competitive edge in the business insurance marketplace.
 
1. Lifehealthpro.com, New Tax Laws Open the Door for Business Insurance Discussion, April 2011. Survey was based on 874 small businesses with 100 employees or less.
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The Income Provider Option

Does your client worry about how a large lump sum death benefit will be spent once they have passed?

Life Insurance can pay out an enormous amount of money in a lump sum deposit to the beneficiary, giving them more money at one time than they have ever had.

This raises the question of how will that money be spent? Will it be spent the way your client intended? Are their children responsible enough to be in control such a large amount of money?
 
How does it work?
 
With an Income Provider Option from our selected carriers, the policy owner may select a guaranteed annual or monthly income stream death benefit for payment to one or more beneficiaries.
 
This endorsement is included with the policy and can provide your client the peace of mind knowing that the death benefit will be used as intended. Not only will this income provider option allow the policy owner to control how the benefits will be paid, it also decreases the current cost of the insurance. The carrier will provide graded premium discounts based on how long the income stream lasts.
 
The Partial Lump Sum Option
 
With this option, only half the death benefit is paid up front and the remaining is distributed in an income stream. This lump sum can help the surviving spouse with burial and probate costs along with any other immediate expenses that may be incurred with sudden death. The income stream can be adjusted any time while the policy is in force, but once the insured passes, the income stream will begin paying out as selected.
 
If you have a client in mind or would like to learn more about this great endorsement, please contact your dedicated Life Associate.

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