July 2021 - Page 2 of 2

Life Insurance as Estate Tax Liquidity: Still Essential Under the $15M Exemption

September 25, 2026July 12, 2021 by Tim Fuller

Advisor and client reviewing an advanced markets estate planning strategy in a private office

With the federal estate tax exemption now permanently set at $15 million per person, fewer families face federal estate tax. For those who do, and for many who face state estate taxes, life insurance remains the most efficient way to pay the bill.

Key takeaways

The top federal estate tax rate is still 40% on amounts above the $15 million per-person exemption.
Life insurance owned by an irrevocable trust can deliver tax-free cash outside the taxable estate.
Permanent coverage also protects against future changes in tax law, which clients can’t predict.

Above the exemption, the federal estate tax still takes up to 40%. Life insurance can deliver the cash to pay it, without forcing a sale of the family business or property.

The estate tax picture today

The exemption has moved a lot: about $5 million (indexed) from 2011 to 2017, roughly double that from 2018 to 2025, and now $15 million per person from 2026 under the One Big Beautiful Bill Act. The rate on amounts above it is still 40%. See what the permanent $15 million exemption means for planning.

Who still faces estate tax

High-net-worth families with estates above $15 million per person, or $30 million per couple
Families whose estates are likely to grow past the exemption over their lifetimes
Residents of states that impose their own estate or inheritance tax, often at much lower thresholds

Why life insurance is the right tool

Estates are often rich in assets but short on cash: a family business, farmland, or real estate. Without liquidity, heirs may have to sell assets, sometimes at the wrong time, to pay taxes due within nine months of death. Permanent life insurance owned by an irrevocable life insurance trust (ILIT) pays a death benefit that is generally income-tax-free and kept outside the taxable estate, providing cash exactly when it’s needed.

Planning for an uncertain future

No one can predict future tax law. A properly structured permanent policy gives families flexibility regardless of what Congress does, with level premiums and cash value that can support other goals. Contact us to run a survivorship or single-life design for your client.

Frequently asked questions

Is life insurance subject to estate tax?

It can be if the insured owns the policy. Having an irrevocable life insurance trust own it generally keeps the death benefit outside the taxable estate.

What is the federal estate tax rate?

The top rate is 40% on the amount of the taxable estate above the exemption.

Why use life insurance to pay estate taxes?

It provides cash at death, generally income-tax-free, so heirs don’t have to sell a business, real estate, or other assets to pay the tax.

50+ Years in Business60+ Top-Rated Carriers★★★★★ Rated by Advisors

Reviewed by Tim Fuller on 2026-09-25

Tim Fuller

President, SRS Inc.

Tim leads SRS Inc., a full-service IMO (Independent Marketing Organization) and BGA (Brokerage General Agency), connecting independent financial professionals with life, annuity, disability income, and long-term care solutions from 60+ carrier partners.

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Handling the Top Long-Term Care Objections: Cost, “It Won’t Happen to Me,” and “My Family Will Help”

September 25, 2026July 8, 2021 by Tim Fuller

Adult daughter and her aging mother sharing a warm moment while discussing long-term care planning

Three objections come up in nearly every long-term care conversation: it’s too expensive, I won’t need it, and my family will take care of me. Each has a thoughtful answer, and the answers work best as questions.

Key takeaways

Cost objections usually mean the need wasn’t developed before the illustration was shown.
“It won’t happen to me” is best answered by asking what their written plan is.
“My family will help” is answered by asking which child would bathe them, and what it would cost that child.

“Which one of your children would you want helping you bathe?” It’s the question that changes most conversations.

Objection 1: “It costs too much”

Many advisors show an illustration too soon, so the premium becomes the problem instead of the solution. Develop the need first. Once clients understand what care would cost them and their family, the premium looks different. Design options are in five ways to make LTC more affordable.

Objection 2: “It won’t happen to me”

Ask: “What is your written plan of care if an extended health need arises?” Most people don’t have one beyond assuming family will help. Close to 70% of people turning 65 will need some form of long-term care.

Objection 3: “My family will take care of me”

Respond warmly: “It’s wonderful to have a family that wants to be there for you. Have you talked with them about it?” Then ask:

Are your children working? Which one could cut back or quit to provide care?
Which one would you want helping you bathe or use the bathroom?
Wouldn’t you rather have a trained professional handle that, so your family can spend quality time with you?

See why family shouldn’t be the long-term care plan.

Why these work

Life insurance is a logical sale; long-term care is an emotional one. A care need arrives as an emergency, not a planned event. When clients understand what caregiving really involves, they see the premium as the solution rather than the problem.

Frequently asked questions

What is the most common objection to long-term care insurance?

Cost. It’s usually best addressed by developing the need before showing an illustration, then adjusting the design to fit the budget.

How do you respond when a client says their family will care for them?

Ask whether they’ve discussed it with their family, which child could cut back work, and whether they’d want family providing personal care.

Why is long-term care an emotional sale?

Because the need is about dignity, independence, and family relationships, not just money.

50+ Years in Business60+ Top-Rated Carriers★★★★★ Rated by Advisors

Reviewed by Tim Fuller on 2026-09-25

Tim Fuller

President, SRS Inc.

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Business Valuation for Buy-Sell and Key Person Planning: Informal Options

September 26, 2026July 6, 2021 by Tim Fuller

Long-time business owners often overvalue their company because of emotional attachment, or undervalue it because they have never seen it from the outside. Either way, a realistic valuation is the starting point for good business planning. It doesn’t always require an expensive formal appraisal.

Key takeaways

A realistic business value matters for retirement planning, fair buy-sell terms and financial justification of coverage.
Formal valuations can cost $20,000 or more, which keeps many owners from getting one.
Some carriers offer free informal valuations using a simple questionnaire and three years of financial statements.

A formal valuation can run as high as $20,000, which is why many owners never get one.

Why owners need a realistic valuation

Retirement planning. Many owners count on the sale of the business as a major retirement asset.
Fair transition terms. A buy-sell or other transition agreement should be reasonable and equitable for everyone.
Financial justification. If the buyout is insured, carriers need a supportable value to justify the coverage amount.

Our article on buy-sell planning for business transitions explains how the value flows into the agreement.

Price vs. value

A real estate agent we know describes long-time homeowners who see the staircase their children crept down every Christmas morning, while buyers see a loose banister and worn carpet. Business owners can face the same gap. Part of an advisor’s role is to gently bring an outside view into the conversation.

Informal valuations at no cost

Formal valuations are thorough but can cost $20,000 or more. For planning purposes, an informal valuation is often enough. We work with carriers that, as a service, prepare informal business valuations from a simple questionnaire and three years of financial information. The results:

Estimate the company’s worth using several common valuation methods
Are formatted for the client and their tax and legal advisors
Support coverage amounts for buy-sell and key person coverage

Availability varies by carrier, so contact us to confirm current programs.

How SRS supports the process

We can help you gather the data, request the valuation and present the findings to the client and their advisors. Contact us to start a valuation for a business owner client.

Frequently asked questions

Why does a business owner need a valuation for life insurance?

Carriers need a supportable business value to justify buy-sell and key person coverage amounts, and the agreement’s price should reflect what the business is actually worth.

How much does a formal business valuation cost?

A thorough formal valuation can cost $20,000 or more depending on the business and the appraiser.

What is needed for an informal valuation?

Typically a short questionnaire about the business and three years of financial statements.

50+ Years in Business60+ Top-Rated Carriers★★★★★ Rated by Advisors

Reviewed by Tim Fuller on 2026-09-26

Tim Fuller

President, SRS Inc.

Connect on LinkedIn →

Life Insurance With High Blood Pressure: Don’t Settle for Standard

September 25, 2026July 2, 2021 by Tim Fuller

A single elevated blood pressure reading at the paramed exam can push an otherwise healthy client into a Standard class. Some carriers look more closely, and the difference in premium can be significant.

Key takeaways

Many carriers use around 140/90 as a key blood pressure threshold for their better rate classes.
A carrier with a more aggressive approach to controlled impairments may still offer Standard Plus above that level.
A 60-year-old woman with a 150/92 reading and no history of hypertension received Standard Plus on $1 million of permanent coverage.

A 150/92 reading at the exam — and the client still got Standard Plus on $1 million of permanent life.

Why one reading can cost a rate class

Blood pressure taken at an exam can run high because of nerves, caffeine, or a rushed appointment. Many carriers use around 140/90 as a threshold, so one elevated reading can drop a healthy client to Standard even with no history of hypertension.

Case study

60-year-old female non-smoker
No history of high blood pressure
Blood pressure at exam: 150/92
Applied for $1 million of permanent life insurance

Offer: Standard Plus.

How to protect the rate class

Schedule exams in the morning, remind clients to avoid caffeine and exercise beforehand, and gather readings from their doctor’s records to show the typical trend. If you’re quoting Standard for healthy clients, check whether a carrier would offer Standard Plus. Upgrade programs can also help when blood pressure is the only issue; see how one-class upgrades work.

Frequently asked questions

Does high blood pressure affect life insurance rates?

It can, but controlled or isolated high readings often have a modest effect, and some carriers treat them more favorably than others.

What blood pressure do life insurers want?

Thresholds vary by carrier and rate class. Many use around 140/90 as a key cutoff, with stricter limits for their best classes.

Can my client retake the blood pressure reading?

Some carriers will consider additional readings or the client’s medical records. Ask us before the exam about the best approach.

50+ Years in Business60+ Top-Rated Carriers★★★★★ Rated by Advisors

Reviewed by Tim Fuller on 2026-09-25

Tim Fuller

President, SRS Inc.

Connect on LinkedIn →

Joint Life Long-Term Care: One Policy, Coverage for Two

September 25, 2026July 1, 2021 by Tim Fuller

Some clients aren’t sure they need long-term care coverage, but they know they’d want it for their spouse. A joint-life hybrid policy covers both people with one premium and a shared pool of benefits.

Key takeaways

A joint-life hybrid policy provides a shared pool of long-term care benefits for two people from one premium.
The second-to-die life structure can create a larger total benefit pool than two single-life policies funded with the same money.
Some policies can cover two family members other than spouses, subject to age-gap limits.

In one illustration, $200,000 in a joint policy produced more monthly benefit and a larger death benefit than two separate $100,000 policies.

How a joint-life hybrid works

The policy is built on second-to-die whole life. Either insured can draw from the shared long-term care benefit pool if they need care. If neither needs it, a death benefit is paid after the second death. Because the benefit is shared, a couple can often get more total coverage for the same premium.

Example: Jim and Bonnie, both 65

Jim alone, $100,000 single premium: lifetime benefit period, $4,279 monthly LTC benefit, $106,984 death benefit
Bonnie alone, $100,000 single premium: lifetime benefit period, $3,927 monthly LTC benefit, $130,908 death benefit
Jim and Bonnie jointly, $200,000 single premium: lifetime benefit period, $7,406 monthly LTC benefit, $246,891 death benefit

Illustrative figures from an earlier date; current values will differ.

Other advantages

Joint designs can offer lower cost of insurance charges and some underwriting flexibility. Some carriers allow two related family members, such as a parent and adult child, within an age gap (for example, 25 years). For couples where one spouse can’t qualify, see handling the couple rejection objection.

Frequently asked questions

Can a couple share a long-term care policy?

Yes. Joint-life hybrid policies and shared-care riders let couples draw from a common pool of benefits.

Is a joint LTC policy cheaper than two separate policies?

Often it provides more total benefit for the same premium, though it depends on ages, health, and design.

What happens if neither spouse needs care?

With a joint-life hybrid, a death benefit is paid after the second death.

50+ Years in Business60+ Top-Rated Carriers★★★★★ Rated by Advisors

Reviewed by Tim Fuller on 2026-09-25

Tim Fuller

President, SRS Inc.

Connect on LinkedIn →

Life Insurance as Estate Tax Liquidity: Still Essential Under the $15M Exemption

The estate tax picture today

Who still faces estate tax

Why life insurance is the right tool

Planning for an uncertain future

Frequently asked questions

Tim Fuller

We’re Here to Help

Objection 1: “It costs too much”

Objection 2: “It won’t happen to me”

Objection 3: “My family will take care of me”

Why these work

Frequently asked questions

Tim Fuller

We’re Here to Help

Tim Fuller

We’re Here to Help

Tim Fuller

Tim Fuller