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Home Is Where The Heart (And Sale) Is

When you approach clients about Long-Term Care Insurance (LTCi), be sure to ask where and how they would like to receive care should the need arise some day. Chances are, they’ll want to stay at home.

65% of long-term care is provided in the home – either in the home of the person receiving care or at a family member’s home.

Many people visualize long-term care as uprooting to a nursing facility – but plans allow for 100% of the benefits to be paid at home, allowing clients to stay with loved ones in an environment they’re used to.
 
Highlight the home care benefits that are automatically included in the coverage.
 
Doing so is a smart and effective way to show you are listening and are able to provide solutions that fit their needs.
 
If your clients are like most people, they find it hard to imagine moving out of the comfort of their own house for help with daily living activities like bathing, getting dressed, and eating. By emphasizing these at-home benefits, you’ll appeal to your clients’ desire to maintain their independence and quality of life, while increasing your potential for a successful sale.
 
We’re here to help you design a plan that is both affordable and the best solution for your clients’ needs – contact your LTCi Sales Reps for guidance.
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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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Underwriting Outcomes That Will Make Your Heart Skip A Beat

Cardiac related impaired risk cases can get somewhat challenging in underwriting. There are many different types of heart conditions – from coronary artery disease to arrhythmias to congestive heart failure and everything in between.
 
With each of these conditions, there are many different factors the carriers consider when determining their underwriting decisions. We know just what to look for in these cases, and which carriers to seek out for the best possible outcomes.
 
Take for instance this recent cardiac success story:
  • 72 year old male, lifelong non-smoker
  • Applying for $3 million of permanent coverage
  • Has a history of two-vessel Coronary Artery Disease and an abnormal EKG finding of Right Bundle Branch Block (heart block)
  • Good compliance with recommended cardiac follow up and testing
We put our noses to the grindstone and worked the emporium to match the case to a carrier willing to offer a Standard rating!
 
It is a win-win when our Underwriting Team is involved with your cases, we leverage our experience to win it for your clients and for you. Get to the heart of the matter – we get the offers you need, to get your clients the insurance they need.
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LTC Detective Work – 6 Things You Need To Do

Long-Term Care can be a tough subject.

Often times, you have to do a little detective work to ensure your cases are processed through Underwriting quickly.

Here are six things you can do to help uncover important information the underwriter needs to issue your case.
 
Ask about specialty physicians.
  • If your client had bypass surgery, ask whether they have a cardiologist.
  • If they had joint replacement, ask if they have an orthopedist.
  • If they have rheumatoid arthritis, ask if they see an arheumatologist.
  • If your client is taking multiple medications for depression and anxiety, ask if they have a psychiatrist.
  • If they have diabetes, ask if he sees an endocrinologist.
Pay attention to the date of diagnosis.
A recent diagnosis (within six months to one year) may not be enough time to assess the client’s stability.
 
Note the date of the last doctor’s visit.
If it’s been over two years since your client’s last physical exam and lab work, they won’t qualify for preferred underwriting. Also, pay attention to recent doctor’s visits. Ask your client if they have a follow-up visit planned. Knowing an applicant is undergoing treatment allows the underwriter to order an attending physician’s statement immediately, instead of waiting until the client mentions it during the personal health interview.
 
Listen carefully for these things:
  • Pending tests – Be sure to ask if the client is scheduled for a test that has not yet been performed.
  • Recent surgeries – Ask what type of surgery the client had. Was a malignancy found? Has the wound healed? You also should ask if the client is released from care or requires further follow-up.
  • Physical therapy – Ask about the diagnosis. Is the pain or condition resolved? Do they require further treatment? Find out if the physical therapy helped or if surgery has been recommended.
Try to identify the diagnosis behind the medication.
Many people refer to a medication in terms of the symptoms it addresses. For example:
 
  • Your client says they take a “water pill for fluid.” This can mean several things, from occasional lower extremity edema to something more serious, like heart failure. Also, pay close attention to the medication dosage as this can be a clue to your client’s condition.
  • Many applicants will indicate they take a “blood thinner.” Ask about the diagnosis. Is there a history of stroke or mini-stroke? Has the client had any type of heart surgery and, if so, when? Has the client had blood clots? If so, how long ago? Has the client had surgery of the leg?
  • If your client says they take a medication for “bones” or to “prevent osteoporosis,” ask if they’ve had a bone density test done in the past two years and what the doctor told them about their bone density. Typically, these medications aren’t prescribed unless bone density tests have indicated the applicant has some type of bone loss, which impacts insurability.
  • If your client mentions taking a medication for “arthritis,” you should suspect rheumatoid arthritis or another serious condition and rate accordingly.
  • If your client lists pain medications, specifically narcotics, it’s very important to find out the reason the medication is used, how often it’s taken and how long the client has used it. For example, does your client use it only after they mow the lawn or do they have pain on a daily basis?
Question everything.
If you have a client who is young, but not working, ask why. Do they have chronic health conditions that prevent them from working? Are they collecting disability benefits? The underwriter needs to know.
 
Please contact your LTC Specialists for more information.
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Why Disability Income?

As discretionary income tightens in most households across the country, many Americans have put the purchase of retirement and insurance vehicles on the back burner, leaving themselves open to risk of severe loss and no way to indemnify.

While most would consider their greatest asset to be a house or a car, in reality a human’s most valuable asset is their ability to earn an income.

Without cash inflow, no insurance, investment, or savings product can be purchased and utilized. Disability Income is a commonly overlooked portion of the planning process yet can be the most important piece of the puzzle.
 
Common misconceptions about disabilities.
 
The main reason Disability Income is usually overlooked by Financial Professionals and their clients is the misconception of what causes a disability.
 
A recent consumer study released by the not-for-profit Council for Disability Awareness (CDA) reported that 71% of respondents said a disability is most likely caused by a serious accident.
 
In reality, insurance statistics show that only 9% of long-term disability claims result from serious accidents. The remaining 91% of income-interrupting disabilities come from common ailments like back and joint pain, chronic diseases, cancers, depression and pregnancy.
 
If your client becomes ill with any of the conditions or disabilities listed above and are unable to work for a period of time, will they have sufficient funds available to continue paying for their numerous financial obligations?
 
We can help.
 
We understand the challenges your clients may be faced with during periods of disability.
 
Our strong relationships with top Disability Providers allow us to help you find the best fit for your client regardless of their occupation.
 
Products range from simplified issue to fully underwritten with the goal of getting your client coverage as quickly as possible. Nearly all respondents in the CDA study rated their ability to earn an income as more valuable than any other resource in maintaining financial security. However, only 37% said they have thought about taking steps to protect their income. Don’t let your client fall into the remaining 63%, the need is real.
 
Contact your dedicated Disability Sales Specialist to learn more about how we can help your clients protect their most valuable asset.
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Stacking Estate Planning Concepts – Saving Heirs a Lot More!

By now all high-net-worth clients should be aware that their biggest death-tax savings opportunity – the lifetime exemption – is going to be cut in half on January 1, 2026.  But taking advantage of the high exemption by gifting property now is only the beginning of how much death taxes can be reduced.

A good rule of thumb:  your clients who will benefit are single taxpayers worth over $10,000,000 and married taxpayers worth more than $20,000,000.

Consider these very brief descriptions of accepted planning concepts that address the common questions HNW clients will ask, and that can be layered on top of the current use of the high exemptions.  They can result in a much smaller tax bill as well as allowing for ongoing property management and use even after gifting takes place.

How much can I save using the full exemption now?

A single taxpayer who uses the full higher exemption by gifting from an estate growing at 5%, might reduce the tax due in 20 years by over $6,000,000.  A married couple using both could save over $12,000,000.

What if my spouse and I don’t want to give away both exemption amounts?

Then use at least one full Again, assuming 5% growth, this could save over $6,000,000 in 20 years.

What if Congress decides not to reduce the exemption amount?

Transfer of assets can be treated as a Family Loan (usually to an irrevocable trust). If the exemptions are not reduced the loan can be called, and the property returned.  If exemptions are lowered then the loan can be forgiven just prior to 1/1/2026 and the property kept in the trust, treated as a gift.

What if I don’t want to lose control of the gifted assets?

Assets to be transferred can be organized under a Family Limited Liability Company (FLLC) with a small-percentage voting interest and a large non-voting interest. The non-voting interest, representing the bulk of the FLLC value, can be transferred while the taxpayer retains all voting interest.

Can a gifting spouse continue to benefit from the assets transferred?

Yes, property can be transferred to a Spousal Lifetime Access Trust (SLAT), an irrevocable trust in which the other spouse is a beneficiary for life. The beneficiary spouse can receive the income from the trust each year, as well as distributions for his or her health, education, maintenance, and support.  This gives the gifting spouse vicarious access (through the beneficiary spouse) to the transferred assets, if needed.  When the beneficiary spouse dies, nothing in the trust is included in his or her estate.

Can spouses set up two SLATs so that each can use their full exemption for the benefit of the other?

Yes, but special attention must be given to the drafting of the trusts by the legal and tax advisors involved, because certain restrictions apply, so as not to run afoul with the IRS.

If you think implementation of any or all of these concepts might help one of your HNW clients, I am available to talk more fully with you, and your client, and their advisors.  Let me know at 706-614-3796 or tom@cpsadvancedmarkets.com.

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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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Help Us Help You: The Art Of The Cover Letter

The best way to present a good picture of your case and help avoid delays or even a possible decline is by submitting a cover letter with the case.
 
It doesn’t have to be Pulitzer Prize-worthy, just a clear and concise explanation.

Don’t necessarily count on the brief information requested on the app to paint the full picture for an underwriter.

Expand on the following in a cover letter:
 
  • Restatement and/or fuller explanation of the purpose of the coverage
  • Method of the determination of the face amount
  • The relationship(s) among the owner, insured, beneficiaries and premium payer
  • Full description of applied for and inforce coverage on other family members (if for personal purposes) or other key people (if for business purposes)
  • Available documentation if needed – e.g. trusts, financial information, business agreements
  • Any other information concerning circumstances that might raise questions with the underwriter (e.g. where the amount of insurance is more than the standard financial guidelines)
Playwright George Bernard Shaw said, “The single biggest problem in communication is the illusion that it has taken place.”
 
The Apostle Paul said, “A letter covers a multitude of sins!”
 
Don’t rely on the illusion of clarity that often hovers over an application as it is passed around the circle. We have several on board who fancy themselves literary and will help draft and submit the cover letter you need. Call and ask!
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Yes, Long Term Care Insurance Can Be Affordable

While it’s a common belief that designing affordable Long-Term Care (LTC) coverage may prove difficult, if not impossible, there are ways to ensure manageable costs.

An LTC insurance policy is only as expensive as you make it.

Flexibility in plan design and product features enables this coverage to be available to meet most budgets. When putting a plan in place for your clients, keep these cost reducing tips in mind to prevent sticker shock:
 
Suggest An Asymmetrical Case Design
 
You may have some clients who want LTC coverage for themselves, but not for their spouse due to cost. While two fully loaded policies may prove costly, coupling a “token” benefit policy for one spouse can save a significant amount on their premium.
 
What can they expect to save?
 
  • One of our strategic carrier providers offers a 40% discount for a married couple applying together (both approved) versus no discount for a married person applying alone.
  • Other carriers will offer a 20-30% discount for a married couple applying together (both approved).
 
Take Advantage Of Age And Health
 
The earlier your clients start thinking about long-term care, the more options they’ll have to consider, and the more affordable those options will be. The ideal age to start the planning process is between 45 and 60.
 
Here are two big reasons why:
 
  • The younger the clients are, the lower their annual premium will be versus a comparable policy purchased at an older age.
  • The younger the clients are when they apply for coverage, the better chance they’ll qualify for a preferred health discount. The older they are, the more likely the application for coverage could be denied.
 
Adjusting To Fit A Budget
 
Regardless of a client’s age, they likely have a variety of other competing financial priorities on their mind. LTC insurance coverage doesn’t have to be an all-or-nothing decision.
 
The most important thing is to make sure to put some level of protection in place, versus ignoring the risk altogether. Having a pool of money in place enables clients to hedge against the risk of needing care someday.
 
We’re here to help you design a plan that is both affordable and the best solution for each of your clients’ needs – contact your LTC Specialist today.
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DI Covers What Workers’ Comp Doesn’t

Alarmingly, nearly 70% of business owners are not covered under the same Workers’ Comp policy they use for their employees. If they were seriously injured on the job, what would they lean on? Medical Insurance doesn’t cover lost income, and pulling revenue out of the corporation is dicey.

An affordable income protection policy to help your business owner clients protect their income from injury and illness – both on and off the job – is available.

Business Overhead Expense Insurance will reimburse the business owner for all fixed expenses – keeping the doors open while they recover.
 
Every business owner who carries Workers’ Comp Insurance is an opportunity – ask if they have a plan in place for themselves. Already covered? Compare the cost. And remind them that even a striving company may not survive long without a chief executive overseeing operations.
 
Business owners aren’t alone – Federal Employees, Independent Contractors, Private Home Domestic Workers, Farm Owners/ Laborers, Maritime Workers, and Railroad Employees are just some of the other occupations also at risk.
 
Contact your Disability Income Specialist for a case design custom to each of your client’s needs.

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