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Is Your Trustee Trustworthy?

Hope springs eternal in the human breast when even the Cheerios Kid can make a comeback. With his sidekick Sue, he was an iconic mainstay in the ads for the General Mills cereal during the 50s and 60s before his cell-animated storylines were put out to pasture to make way for a wave of faster-paced, sensory-bombarding commercial forms.
 
Only in a more cholesterol-conscious age was he brought out of mothballs to promote the hearty and healthful impact the oat-based product could have on consumers. But the emphasis on good eating habits this time around didn’t hold a candle to the mini-adventures capsulated in those one-minute promotions from olden times where a bowl of “Go-Power” got the Kid through when all else failed.
 
I recall in one the narrator informed viewers that, “When he grabbed his rifle trusty, he found it was a trifle rusty.” They just aren’t making ‘um like that anymore.
 
Trifly rusty rifles got me thinking about the importance of trifly trusty trustees.
 
In the case of U.S. v. Randy Read (memorize that and name-drop at your next dinner party) the taxpayer funded an irrevocable trust with his spouse’s appreciated stock options for the benefit of their children. Over time the options were exercised and the stock sold and the trust accrued an income tax liability to the tune of about $125,000. Rather than paying the tax bill the trustee distributed the trust assets to the kids according to the terms of the trust.
 
When the IRS finally caught up with him, which they always do, the U.S. District Court held the trustee personally liable for the tax owed because he had paid other expenses “having notice of the facts that would lead a reasonably prudent person to inquire as to the existence of the debt” owed to the United States.
 
As insurance advisors we, all the time, encourage clients to make plans that involve the selection of people to serve in fiduciary roles – be it the executor of a will, an attorney-in-fact under a power of attorney, a trustee of a trust, or the like.
 
At this point people usually shuffle about for some super-nice, but semi-reliable Uncle Joe in the family who is willing to fill the role as an accommodation having little understanding of the responsibilities involved.
 
The otherwise esoteric Read case is a rude reminder that fiduciaries do not fill honorary positions.
 
The must be ready to make life-altering decisions, sometimes under extreme circumstances. In addition they must conduct the financial aspects of their office in good order, and while the empowering document may indemnify them from liability involving those in their charge, it does not necessarily absolve them of responsibility to other third parties, especially the federal government.
 
A second admonition is to give proper care in the selection of contingent or co-fiduciaries. In many cases, especially when planning for young children, appointed fiduciaries are usually older than those they will serve, so the likelihood that the contingent may be called upon looms large. And understand that with co-fiduciaries, an appointee must be sure to select like-minded people to advance a planner’s purposes – and make sure there can be no tie votes!
 
Be sure that any legal counselor you recommend adequately tutors clients as to the importance of and qualifications for those selected to conduct their affairs when they cannot.
 
Back to the Cheerios kid…
 
The cereal was named CherriOats when introduced by General Mills in 1941. Over the years 15 additional variations have been marketed, the latest being Ancient Grain Cheerios which includes age-old grists like spelt, quinoa and karmut wheat. Honey Nut Cheerios is the largest selling cereal brand in the United States. The original ole oats roll in at #4.
 
Call us concerning questions you have on the role of fiduciaries in your clients’ Life Insurance, Annuity, Long-Term Care and Disability Income planning.
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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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Score With Life Insurance Underwriting Niches

Take a look at some surprising possibilities that can help you win a sale for clients with health impairments.
 
Preferred Plus MAY be available even with the following conditions:
  • Anxiety/Depression/Mood Disorder – One episode, duration of less than one year, recovered, no current medication
  • Asthma – Mild exercise induced or mild seasonal asthma
  • Osteoporosis – With no complications
  • Some skin cancers – Basal cell, superficial squamous cell carcinoma or single atypical nevus or dysplastic nevus (mole) with no family history of melanoma; Must have well-documented dermatology follow-up
Preferred MAY be available even with the following conditions:
  • Anxiety/Depression/Mood Disorder – Current and only on one drug; Well-controlled
  • Epilepsy – No seizures for more than 5 years; Not taking any medication
  • Moles/Nevi – Up to 3 atypical or dysplastic nevi (moles) with no history of melanoma or family history of melanoma and favorable dermatology follow-up
Contact the Life Underwriting team for more details and soon win the fanfare of your clients.
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A Game-Changer for Agents: The Power of Hybrid LTC Annuities

Have clients over 70 sitting on nonqualified assets but can’t qualify — or don’t want to pay — for traditional LTC insurance? You’ve got a powerful option: Hybrid Long-Term Care Annuities.

The LTC Catch-22

The fastest-growing population segment is adults 85+, yet most aren’t financially prepared for a long-term care event. Traditional LTC insurance is often too expensive, too hard to qualify for, or simply rejected by clients who assume they’ll never need it.

But here’s the win: many of these same clients do have nonqualified assets they don’t plan to touch. That’s where you come in.

Turn Idle Assets into Tax-Free LTC Benefits

Nonqualified annuities offer tax-deferred growth—great for retirement, but painful if liquidated for care expenses due to taxes and fees.

Thanks to the Pension Protection Act, hybrid LTC annuities funded with nonqualified dollars allow clients to access LTC benefits tax-free. No penalties. No income tax hit. And if LTC isn’t needed? The remaining value goes to their beneficiaries.

Why Agents Should Act Now
  • Simplified underwriting – ideal for clients who can’t qualify for traditional LTC.
  • No “use it or lose it” – funds not used for care pass to heirs.
  • Urgency matters – the older the client, the more difficult approval becomes.

Don’t let these opportunities sit idle. Contact your LTC Specialists today to help your clients turn dormant assets into living benefits.

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Short-Term DI Vs. Long-Term DI

Short-term disability insurance and long-term disability insurance are both designed to provide replacement income to your clients, in the event they are unable to work due to accidents or sickness. The most obvious difference between the policies is the amount of time they are designed to sustain your clients’ incomes.

A short-term policy will pay benefits for a select period up to a maximum of two years; a long-term policy will pay benefits for a select period of a minimum two years, and up to age 65 or even age 70.

Let’s take a further look at the advantages to both policies.
 
Advantages of Short-Term DI
 
Short-term disability insurance pays benefits after a pre-determined elimination period (the number of calendar days after a disabling injury or illness, before the disability insurance policy would begin to pay benefits) has been met.
 
Short-term disability insurance lasts for a shorter, specified period and typically a shorter elimination period or “waiting period” before benefits become payable. The average elimination period is 7 to 30 days. This type of insurance policy is useful for major, but relatively brief disabilities such as those suffered from accidents or non-terminal sickness.
 
Also available is a very affordable short-term disability plan that only covers accidents. These are popular with younger, blue collar workers worried about getting hurt (either on or off the job). The premium is more affordable, as it does not cover sickness – so this should be offered to clients who aren’t as concerned about getting sick, but are more concerned about getting hurt or having an accident.
 
In many instances, short-term disability insurance is only a portion of how clients protect their income in a situation where they cannot work. They may also use their emergency savings, workers’ compensation, paid leave and other forms of insurance in conjunction with short-term disability. But, when these benefits are exhausted (or if they never had them in the first place), short-term disability can provide critically important funds.
 
Advantages of Long-Term DI
 
In the case of a long-term absence from work, a combination of short-term disability insurance benefits and other savings may not be enough to financially sustain your clients and their families. This could leave them vulnerable to financial burdens, such as mortgage foreclosures or default on debt.
 
A long-term disability insurance policy can help protect your clients and their families from scenarios like mortgage foreclosure and bankruptcy. These insurance policies are typically more comprehensive, offering long-term benefits that will protect your clients in the event of accidents and sickness. There are also additional rider options available such as a Cost of Living Adjustment, Partial Disability Benefits, and Benefit Increase Riders. The additional options for a long-term policy allow you to tailor coverage to meet your clients’ unique needs.
 
The benefit period on these policies ranges from two years, or until age 65 or 70, and often have a longer elimination period such as 90 to 180 days. Because your state may have different regulations governing the length and availability of long-term (and short-term) disability insurance, please contact us for plan availability.
 
How can you get started on designing the right plan for your clients? Asking the right questions is always a good start.
  • How long would they be able to meet their monthly expenses if they were unable to work for a period of time?
  • How much of their savings would be available?
  • Does their employer offer an income protection plan?
  • What are their occupations and annual reported incomes?
For more information about short-term and long-term disability insurance, contact your DI Sales Rep.
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“If It Isn’t Written Down, It Didn’t Happen” – Wills, Powers-of-Attorney & Health Proxies

Any fan of the novelist Tom Clancy is probably familiar with these words uttered by the wife of his chief protagonist, Jack Ryan. Ryan is constantly needling Dr. Caroline “Cathy” Ryan about her compulsive habit of making notes about everything as a method for reminder and also a simple record of events.
 
She defends the practice as the best way to keep track of everyone’s commitments and intentions, especially given their hectic lifestyle – in that book he happens to be Vice President and she a busy physician, both with young children in tow.
 
Creative marketers and seminar sales-folk have built and sold entire programs of self-discipline and personal organization around the concept.
 
But the government of the state in which you live is far ahead of both.

Regarding your client’s planning intentions and goals; all 50 states have legislation in effect that effectively says, “If they aren’t written down, then they didn’t happen!”

Who needs Estate Planning?
 
The fact is that everyone needs estate planning, not just the wealthy. Everyone has concerns about what will happen to themselves, their survivors and their belongings in the event of any number of life-changing events.
 
Critical to the assurance that all will go as desired in each circumstance is the execution of at least three written planning documents. If they don’t exist then the State will do your clients’ planning for them.
 
Contact Tom Virkler, JD, CLU, Director of Advanced Markets, at (706) 614-3796 or tom@cpsadvancedmarkets.com to discusses these documents in further detail so you can better encourage every client to take necessary steps for their completion in conjunction with their advisors.
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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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Prostate Cancer – Great Offers Are Possible!

What is prostate cancer? Prostate cancer occurs when cells in the prostate gland grow out of control.
 
Some prostate cancers can grow and spread quickly but most grow slowly. There are often no early prostate cancer symptoms, but some men have urinary symptoms and discomfort. Prostate cancer treatment options are surgery, chemotherapy, cryotherapy, hormonal therapy, and/or radiation. In some instances, doctors recommend “watchful waiting.”

All men are at risk for developing prostate cancer. Other than skin cancer, prostate cancer is the most common cancer in American men.

About one man in nine will be diagnosed with prostate cancer during his lifetime, but only one in 41 will die of this disease. The average age at the time of diagnosis is about 66.
 
Factors, such as age, race, and family history that may contribute to the risk:
  • The Gleason Score (GS) indicates the tendency for rapid growth, recurrence or metastasis of prostate cancer, with two being the least worrisome and scores of eight to 10 being the most aggressive. Think of the stage as a car’s odometer and the Gleason Score as its speedometer. Generally, the lower the stage, the more likely that treatment will succeed with no recurrence of cancer.
  • The PSA is a blood test for prostate cancer.
  • A bone scan is sometimes performed to determine if the cancer has metastasized, that is, spread distantly from its origin.
  • The extent to which prostate cancer has spread is categorized by staging, usually determined by examination, ultrasound or MRI. However, examining tissue removed by surgery gives a more definitive picture of the stage of the cancer.
  • Treatments include Surgery (prostatectomy), Chemotherapy, Radiation; external beam or implants, Watchful Waiting, Hormonal Therapy.
Here is a case study:
 
Fred, 56 years old
Seeking $3 million of permanent coverage
  • Was told by his internist almost six years ago that his PSA was moderately elevated.
  • A biopsy showed prostate cancer.
  • After weighing the relative treatment risks and benefits, Fred decided on surgery. Cancer was present in two areas within one side of the prostate.
  • His Gleason Score was 6.
  • At a follow-up exam two months ago, Fred had no major symptoms and his PSA was so low that it was immeasurable.
Having been treated several years ago for his early-stage, moderately aggressive cancer and showing no signs of recurrence, Fred could qualify for a life policy at Standard rates.
 
Call our Life Underwriting Department today! Let’s work together to get the offers you need.
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When Asset Based LTC Is A Fit

Most people will need long-term care services at some point during their lives, and the costs can be staggering.
 
Asset Based Long-Term Care offers your clients an efficient way to plan for these potential expenses with LTC coverage plus as well as a death benefit for cost recovery.
 
Four potential client profiles for Asset Based LTCi.
 
1 | Clients ages 40-80 with “sleeping assets” or cash, such as:
  • Cash, CDs or bonds that are maturing
  • Proceeds from selling a business
  • Funds from downsizing/ selling a home
  • A recent inheritance
CONCERN: Impact a LTC event could have on their spouse, family and finances
PAYMENT: Single Premium
 
2 | Clients ages 55-67 closing in on retirement who are:
  • In the peak of earning capacity with excess income for premiums
  • Preferably age 59.5 or older so they can access qualified money not needed for retirement income
CONCERN: The financial and lifestyle risks LTC expenses could have on their spouse
PAYMENT: 5, 10, 20-pay or pay for life
 
3 | Retirees with IRAs, annuities or income sources to reposition:
  • Required minimum distributions from IRAs not needed for income purposes
  • Annuities not needed for retirement income purposes
  • Social Security benefits not needed for living expenses
CONCERN: Protecting assets/ income and reducing LTC dependence on family
PAYMENT: 5, 10, 20-pay
 
4 | High earners not rich yet (HENRYs) ages 40-55 who:
  • Have excess annual liquidity
  • May have experienced providing care for a parent or grandparent
  • See the value of buying earlier rather than later
  • Would like to insure their parents for LTC to protect their own savings and retirement assets
CONCERN: Protecting assets/ income and reducing LTC dependence across generations
PAYMENT: 5, 10, 20-pay
 
Contact your LTC Sales & Marketing Associate today for more information.
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Introducing Brand Protection Insurance

It doesn’t matter whether it’s an athlete, an entertainer or someone just famous for being famous; if you want to raise a brand’s profile quickly, hiring a celebrity is a proven way to do so. However, fame can sometimes turn into notoriety.

The media always seeks to uncover celebrity details, and what is exposed is not always flattering.

Death, Disability, & Disgrace coverage provides support for brands that use celebrities or spokespeople to endorse and publicize their products or services.
 
If in the unfortunate event the insured causes the Brand/Company into being viewed negatively by the public, or the insured becomes disabled or pass away during the policy period, the policy provides up to an agreed sum, enabling the brand managers to recover costs and expenses of the insured campaign.
 
Consider this:
 
Take the case of a young performer, who just signed a tour contract and a promotion contract for a well-known beverage company. Both the promoter and the beverage company purchased a Death, Disability, & Disgrace policy to protect their investments and company images.
 
Halfway through the tour, the young performer had a nervous breakdown and committed numerous acts that were viewed negatively by the community. The tour had to be cancelled and the drink company’s advertising had to be pulled.
 
With the Death, Disability, & Disgrace policies, the promoter was able to recoup the cost of the cancelled shows and the drink company was able to recover costs and expenses of the insured campaign.
 
Brand Protection Insurance is ideal for Sponsorships, Spokespersons, Celebrity Endorsements and Personal Appearances.
 
Please contact your Income Protection Specialist today for more details today.

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