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CPS Impact Life

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Create New Sales Opportunities With Term Insurance

Term Insurance is often used as a cost effective way to replace income, repay debts and/or provide a legacy in the event of a premature death.
 
In addition to these great functions, there are certain term insurance products that can provide your clients with more comprehensive benefits while they are still alive.

Promoting these solutions will not only deliver additional value to your clients, but will also help differentiate you from the competition in what is largely a price driven marketplace.

Consider This
 
For many clients, a major medical event (such as a heart attack, stroke or being diagnosed with cancer) can have devastating financial effects and leave their family unsure of how they will continue to make ends meet while paying for medical care.
 
Did you know that there are term insurance products which could be used as a source of income in the event that the insured were to experience once of these medical events?
 
With built in critical illness and chronic illness benefits, you can help your clients obtain coverage that will offer benefits while the insured is still alive. There is even a product available with these living benefits that can accommodate non-medical underwriting for face amounts up to $249,999!
 
With the introduction of these living benefit features to the term insurance marketplace, you now have a simple sales concept that you can use to create new sales with prospects and existing clients alike. How many of your clients would consider replacing their existing term coverage with a product that could pay benefits if they were to experience a major health event?
 
Contact us today for a copy of our Policy Review Kit and to learn more about the living benefit term solutions available in your state.
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Wealth Transfer Strategy Using Deferred Annuities To Fund Life Insurance

Do you have clients that originally purchased a Deferred Annuity to find that they no longer need it for retirement income purposes? Often, these clients intend to “leave it for the kids.”

Although a Deferred Annuity is a great vehicle to accumulate funds for retirement, it is not an efficient vehicle to transfer wealth since it may be taxed twice at death.

How can your clients avoid this? By reducing or replacing the Annuity with more tax-efficient assets.
 
How It Works
 
Annuity Maximization is simply an asset repositioning strategy in which the Annuity is exchanged or converted to a Single Premium Immediate Annuity (SPIA). A SPIA provides an income stream for a chosen number of years based on a single deposit made to purchase the Annuity in addition to your client’s age and health status.
 
Your client may then make gifts of the after-tax income generated from the SPIA to an Irrevocable Life Insurance Trust (ILIT). The ILIT then has the funds to purchase a Life Insurance policy on your client’s life for an amount that replaces or exceeds the value of the Deferred Annuity, to benefit the heirs. The Life Insurance policy pays out the tax-free death benefit at the end of the client’s life.
 
You want to be sure to avoid taxation on your client’s Deferred Annuity as it can be taxed up to 70%. By converting the Deferred Annuity to a SPIA and then leveraging the SPIA income withdrawals to purchase Life Insurance, you’ve created a simple solution to increase the amount transferred to the heirs of your client.
 
For more information on this plan or any other Life Insurance sales ideas please contact your Life Sales Marketing Manager.
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3 Out Of 4 Clients Want Help Preparing For Retirement – Do They Know How You Can Help?

Clients often think of life insurance solely as an instrument to protect them in the event of premature death, unaware of the valuable tax benefits that are afforded through cash value life insurance. And in today’s volatile marketplace, clients that are saving to retire need all the help they can get.

You have access to many products that can provide your clients with tax favored cash accumulation and if structured properly, will also provide for non-reportable, tax-free income.

The ability to specify a premium schedule is one of the great features available in our cash value life insurance products, removing the objection that the policy costs too much money. By educating your clients about the benefits of cash value life insurance as a long-term savings vehicle, they are likely to fund the policy with as much premium as they can reasonably afford.
 
While term insurance may be efficient for replacing income, or indemnifying debts, clients are very likely to outlive their level benefit period – receiving no return on their premium contributions.
 
How You Can Help
 
Recommending a cash value insurance policy at a younger age and more favorable health will better prepare your clients to address critical financial concerns such as retirement income planning, college tuition funding for loved ones and also paying for unexpected events (medical emergencies, litigation, home renovations, etc.) in their family.
 
The longer that you can fund a policy and allow the cash value account to compound interest and grow, the larger the potential income stream will be. One of the unique features of using life insurance is the death benefit – if the insured dies prior to accessing their cash values, it will provide a tax-free return on the premiums paid to date.
 
Many of your clients want to have a conversation about their options in regards to preparing themselves for retirement, but feel overwhelmed by the thought or do not know where to start. If you haven’t shared how cash value life insurance can play an integral role in their long-term financial planning strategy, you are likely missing out on easy sales; leaving the door open for another broker to have that conversation with them instead.
 
Your Life Sales Rep can provide you with an understanding of the different products available for cash accumulation. We can provide you with customized solutions for each client. Whether they can spend $100/month, $1,000/month or $10,000/month, we can create a solution that fits their budget.
 
Contact us today to learn how you can begin to position cash value life insurance as a core product offering to all of your clients.
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Who Are Your Best Business Owner Prospects?

Companies that inquire about business evaluations are usually looking to learn how much their company is worth – and find business solutions through life insurance. These solutions range from exit planning, business protection, transferring wealth to the next generation, and even retirement planning.

Recently, statistics have been released to help better identify the types of companies that typically inquire about business evaluations.

The resulting top five industries are:
  • Professional, scientific, and technical services
  • Manufacturing
  • Construction
  • Wholesale trade
  • Retail trade
The statistics also revealed that these companies are mainly S&C corporations, with about 13% being private partnerships – and an overwhelming majority have about 1-99 employees with over 25 years in their respective fields. Half have an annual sales volume of $1-$3 million; 18% generate $3.1-$10 million, where 12% are reaching $10.1-$50 million in sales. Less than 3% do more than $50.1 million in sales.
 
When owners use the business evaluation process, results can lead to significant opportunity.
 
Related planning in the form of a Buy-Sell case results in an average case size of $11,301. Average case size for Key Person policies are $8,986. Executive Bonus cases average $28,756.
 
Some other interesting statistics advisors should be aware of are the percentages of businesses that successfully pass operations on from one generation to the next: 70% of first-generation operations do not successfully transition to the next generation. 90% of the second-generation do not make it to the third generation, and 96% of the third-generation do not survive to the fourth generation.
 
The purchase of life insurance policies on the owners’ lives can ensure there is enough money to pass along to the next generation, to successfully run and operate the business going forward. Or, if an owner has a child who has no intention of running the business, life insurance is a great solution to equalize this child’s inheritance, and help other family members who may be looking to take on the family business avoid any potential tension.
 
Please reach out to your Life Sales Marketing Manager to learn more about these statistics, and how life insurance is a critical part of the business planning process.
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How To Lower Your Client’s Premium – Every Time

What if you could offer your client the lowest premium on any Term or UL policy every time?
 
For years, Life Insurance carriers haven’t given their clients the option to offer the death benefit proceeds to be paid in any way but a lump sum. However, with new product advancements a few carriers now offer a flexible death benefit payment option than can provide an income stream for the beneficiaries, while significantly lowering the premium for the insured.

The Income Provider Option from a few of our selected carriers allows the policy owner to select a guaranteed annual or monthly income stream death benefit for payment to one or more beneficiaries.

How it works:
 
Not only will this Income Provider Option allow the policy owner to control how the benefits will be paid, it also decreases current cost of the insurance by providing graded premium discounts based on how long the income stream pays out. This endorsement is an extremely innovative and cost effective way to hedge against adverse underwriting or premiums above your client’s tolerance to get them the coverage they really need.
 
The Income Provider Option also presents the client with a great deal of flexibility granting them the ability to directly specify how the payments will be made to the beneficiary. Payments can be structured so that a surviving spouse receives a payment from the policy every wedding anniversary, or a grandchild receives a sizable birthday gift from a grandparent for a designated amount of years. This payment option can provide a lasting legacy and address the personal and sentimental value of the Life Insurance policy by ensuring the death benefit is paid the way the insured intended.
 
The Income Provider Option provides your client with two immediate benefits; first, it will give them peace of mind knowing their family will be cared for the way they intended, and second it will help lower current premiums, leaving them more discretionary income while they are still alive.
 
If you have a client in mind or would like to learn more about this great endorsement, please contact your dedicated Life Sales Associate.
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4 Ways Clients Can Cash Out On Their Life Insurance

Your clients need guaranteed life insurance protection today – but life changes, and so can your clients’ life insurance needs.

A unique feature on guaranteed universal life is a return of premium option, included at no additional charge within the policy, which provides clients with an exit strategy, giving them flexibility for their future.

How does this rider work?
 
Clients purchase a Guaranteed Universal Life (GUL) policy and make the required premium payments – the required premium is the amount that guarantees the death benefit through age 100. On the 15th, 20th and 25th policy anniversary, clients have a 60-day window where they have the opportunity to surrender their policy and get their premiums returned to them. If they don’t exercise the rider, there will be no impact on the policy.
 
4 Cash Benefits For Your Life Insurance Clients
 
  1. For Retirement. A 45-year-old insured receives 20 years of death benefit protection and at age 65 receives her paid premiums back and uses the cash to supplement retirement income.
  2. For College Costs. The insured bought two permanent policies and currently has young children. One of the policies was a GUL policy with the refund option available. When the children are at the age to attend college, the death benefit needs of the family change. He can surrender his GUL policy in year 15, 20 or 25 and use the cash to help pay for the child’s college education.
  3. For Business Planning. The insured owns her own business and has a key employee, Tom. She purchases a GUL policy to protect her business if Tom died unexpectedly. In year 18 of 20, Tom resigns – and two years later she will receive all of her premium payments back.
  4. To Pay-Up Another Policy. A 55 year old has a need for $5M in life insurance. He purchases two GUL policies, one for $2M and another for $3M. When he turns 75, he no longer needs as much coverage. He surrenders the $2M policy and uses the cash value to pay up the remaining policy. The insured still has $3M of insurance with no further premiums due.
Contact your Life Sales Rep for more on how the return of premium option can positively impact your clients and your business.
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One Life Insurance Plan – Numerous Benefits

Life Insurance is one of the most valuable assets there is – especially when you consider the numerous benefits that a Permanent Life Policy can provide now, while still securing a financial future for loved ones down the line.

Successful individuals between the ages of 30 and 50 with young families will find that permanent Life Insurance is an ideal asset.

If properly structured, permanent Life Insurance can produce:
  • Tax free death benefit to loved ones
  • Tax deferred cash accumulation and income
  • Tax free benefits to pay for long term care expenses
On top of all these benefits, permanent Life Insurance also offers:
  • Flexible payments
  • No required minimum distributions
  • The opportunity to earn premium discounts and rewards – for clients who engage in John Hancock’s innovative Vitality Program
Do you know which clients you should be marketing Permanent Life Insurance to? Look for clients that seek out value – not just the lowest price on a spreadsheet. Talk to individuals who are open to new concepts and would be interested in one plan that will address their multiple needs.
 
Contact your Life Sales Rep to learn more regarding what benefits you could be offering using Life Insurance and a few hundred dollars per month.
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How To Convert More Life Insurance Applications Into Paid Production

Surprises can be fun, but not when they’re thrown into the Life Underwriting process.
 
As producers, we all have experienced the challenge of making a recommendation, completing an application kit, and working through days, even weeks, of underwriting – only to learn that the client cannot qualify for preferred rates due to family history, or that they must pay a substandard premium because of multiple driving violations.

After all the work, how many of your applications actually end up being placed in-force?

Eliminate any unexpected surprises during underwriting.
 
We can provide you with tools that will aid in accurately assessing and qualifying your clients’ insurability.
 
Improve the percentage of applications that are converted into placed policies by performing a basic life needs analysis; asking the right field underwriting questions, and setting reasonable expectations with your client.
 
Qualify your impaired risk clients more accurately with one page fact finders we call Quick Quotes – with over 30 customized fact finders available online, there is a questionnaire available for almost any client profile.
 
Completed forms are analyzed by our dedicated Underwriting Department.
 
When appropriate, a member of the Underwriting Team will speak with you personally about your clients and provide directed questions about their health and medical history – the goal is to obtain tentative carrier offers before you make a carrier recommendation or take an application.
 
Completing a life insurance needs analysis and gaining an understanding of your clients desired premium outlay allows us to work backwards – maximize the insurance policy benefits while not going a penny over the client’s intended budget, even if they are adversely approved in underwriting.
 
Don’t assume all of your clients are healthy and will qualify at preferred best rates.
 
The reality is that less than 10% of all applicants qualify for the top tier rate class and the majority of clients are approved at standard rates. Take advantage of our services and expertise to avoid any underwriting surprises.
 
Contact us today to learn more about the resources available, and how you can improve your life application placement ratio.
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Is It Time To Upgrade Your Client’s Life Policy?

“Old Insurance” Vs. “New Insurance” – Which Do Your Clients Own?
 
While the death benefit is quite often the most important feature of life insurance, there are many products available that provide additional features and benefits.
 
The term “old insurance” applies to policies that don’t have much additional value beyond the death benefit, while “new insurance” would refer to life insurance where clients do not need to die in order to receive a benefit.
 
We advocate regular reviews of your clients’ insurance policies, to ensure they have the most appropriate and effective product solutions to meet their ever-changing needs.

A policy review may uncover that the existing amount of coverage is no longer reflective of their true need and/or that there’s opportunity to enhance their coverage via the inclusion of living benefits.

Take for example the following:
 
  • Long-Term Care, Chronic Illness and Critical Illness Riders are just a few examples of “new insurance” benefits not commonly available at the turn of the century.
  • The evolution of Index UL can provide your clients with tax-favored accumulation and tax-free income – which can serve as an alternative solution to the Roth IRA if they are restricted by contribution limits or earn too much income, making them ineligible for the Roth IRA altogether.
  • For younger clients concerned about retirement income, cash value life insurance makes for a great addition to their investment portfolio by providing a diversified source of accumulation.
Most clients only know about “old insurance,” and would likely consider a replacement if they were aware of the enhanced benefits available through “new insurance” products.
 
Don’t let your clients hear this story from another agent or advisor. We can provide you with turn-key policy review materials, and will help you to create a list of key talking points you can use to initiate discussions with your clients about their existing policies.
 
Contact your Life Sales Rep today for more information.
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How To Turn Single Term Insurance Sales Into Three Commission Checks

Term Insurance is designed to provide coverage for only a specific duration of time (10, 15, 20, 30 years). However, almost every term policy sold through us includes a provision allowing clients to convert their term policy into a permanent insurance policy – without requiring any new medical underwriting.
 
One of our brokers shared how they use this provision to create additional sales while also providing clients with a solution that they can rely on for the rest of their lives. During the initial sales discussions, they promote this conversion privilege, working with the client to determine how much coverage they would need and how quickly they could afford to exercise this option.
 
Since the pricing for the permanent insurance is based on the client’s attained age at the time of conversion, the sooner that the client converts their coverage, the less expensive it will be.

The client does not need to convert their entire term policy at once and can make use of multiple partial conversions to help keep premium costs low while providing added flexibility.

For example, if the client decides to purchase a 10 term policy for a $1M face amount, they could potentially convert $500K next year, $250K more in 5 years, and then make a decision whether they want to convert and maintain the remaining $250K towards the end of the level term period.
 
Many of your clients do not know that their term coverage includes this feature.
 
Far too often, the discussion of how and when to exercise a term conversion option is a reactive one, taking place when the level term coverage is about to end or shortly after the client has experienced a change in health for the worse.
 
Don’t set your term sales on auto-pilot.
 
Talk to your clients about why it makes sense to take advantage of the conversion provision. Explain how they can keep their initial term policy rating for the rest of their life without having to re-qualify in the future. It’s another great reason to stay in contact with your client and could even create new sales and/or referral opportunities with their family and friends.
 
Oh, and did we mention that you collect a new commission for each conversion sale you make? Your Life Sales Rep is here to help – contact us today.

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