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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.

Everyone knows what cash can do.  Use this simple concept to demonstrate the value of purchasing a Long-Term Care policy that includes a built-in cash benefit.

Take out a piece of paper and write on it vertically: A, B, C.

A is for Assets

When the need for Long-Term Care first arises, many people worry they may not have assets available to pay for care they need.  This is especially true for people who may have to liquidate assets like stocks, CDs or even property to pay for their care.

B is for Burden

Families typically step in to help a loved one who needs Long-Term Care.  But that may be difficult for adult children who have their own family and career responsibilities.  If your clients are like most people, the last thing they want to do is to become a burden to their family.

C is for Choices

A Long-Term Care Insurance policy that offers a cash benefit can help someone receive care in the comfort of their own home.

The cash can be used however its needed most.  Whether it’s to pay for an airline ticket or a tank of gas so a child can help out or for housekeeping or meal delivery services.

With one of our strategic carrier providers, the cash is available to you on day one.  That means when you become eligible for benefits under your policy, there’s no waiting period to qualify for cash.  This is something you won’t find from other insurance companies.

In addition, should your client need a higher level of care someday, they always have the choice to switch from the cash benefit to a traditional reimbursement benefit, which reimburses for the actual Long-Term Care services expenses incurred.

For more information about this sales idea, contact your LTC Specialist today.

Dynamic duos like Batman & Robin, Starsky & Hutch, and Bonnie & Clyde, all have one thing in common – they rely on each other to get the job done right.  Your clients in business partnerships do the same – but, what would one do without the other?

Business partners must plan for the “what ifs” of the future.  What if one partner passes, what if the other wants to retire – not often considered is what if a partner were to become disabled?

Buy/Sell Agreements will always address the event of death or retirement – and are crucial to include in any business owner clients’ plans.  However, most do not identify what to do should a partner be too sick or hurt to function as a managing partner.

Consider the following:

A business with three partners at the average age of 37 has a 78% chance of at least one partner becoming disabled before retirement*.  Many feel the cost of Disability Buy-Out coverage is too expensive, but in reality it provides numerous advantages, security, and is remarkably affordable.  Read more about the importance of including disability buy-out insurance in your client’s business continuation plans here.
A 3-partner CPA firm with an average age of 35 and current business valuation of $1,500,000 would cost less than $500 per month to cover all 3 partners in the event one should get sick or hurt.  Provide a smooth transition with guaranteed premiums to retirement age. View Principal’s plan composite for a CPA firm here.

Reach out to your business clientele and review their business succession plan and/or their buy/sell agreements.  Make certain they understand the importance of addressing a potential disability in their plan.

To ensure your clients’ succession plans will cover all of their needs – contact your DI Sales Rep for guidance.

*Source: Commissioner’s Individual Disability Table A, Equally Weighted – All Occupation Classes, Unisex

Back in the days before the development of things like the NiMH or lithium-ion battery, stand-up comedian Don Adams (who later became Maxwell, the original Get Smart secret agent) used to joke that electric cars were unpopular because of the high cost of the extension cord.

Many insurance advisors face a similar hurdle when advising clients to properly set up a buy-sell arrangement using term insurance to fund the plan.

The cost of getting with the attorney to draft and implement a written agreement, to say nothing of the time and effort required, is discouragingly disproportionate to the amount of premiums for the coverage.

Consequently, just to get things done the policies are often jointly-owned as a “no-fuss” method of assuring that proceeds will get to the surviving owners to buy out a deceased owner’s estate, without a formal agreement.

It works like this:

Joint owners and beneficiaries (some states add “with right of survivorship”) share equally in the possession of the policy and the right to proceeds, so long as they survive the insured.  If not, only the survivors share equally. So if equal business owners A, B, and C agree to fund a buy-sell then, e.g., A and B jointly own the policy on C.  When C dies A and B have funds to buy C’s business interest.  But more important, C’s joint interest in the policies on A and B ends.  A and B are now the sole owner and beneficiary of the policy on each other for use at the second death.

Something is said to be “jury-rigged” when it is simply constructed with the materials at hand.  That same thing is “jerry-built” when it is done in a shoddy or inferior fashion.  Buy-sell plans built solely on joint policy ownership are both.  The only thing assured is that the money gets to the prospective buyers.  After that it’s all up for grabs.

Consider:

The surviving owners are under no legal obligation to buy, leaving the estate of the deceased (probably the surviving spouse) in a lurch.
The deceased’s estate is under no obligation to sell, leaving the deceased’s heirs as a new owner in the business.
There is no fixed price for the business for estate or for income tax purposes should the IRS get involved.
Re-arrangement of interests in the remaining policies could constitute a transfer-for-value.

Of course the worst that could happen is for someone to die with no coverage in force.  So if clients are resolute in their refusal to take proper steps to implement a written plan, the advisor should at least get coverage issued with the most advisable ownership arrangement.  But in addition the file should contain a cover-your-backside letter from the advisor to the clients spelling out the need to discuss the possible problems with their tax and legal advisor.

Call for help in drafting the letter and, just maybe, we might even talk the clients into going to their attorney and doing it right.  Try 706-354-0401 or tom@cpsadvancedmarkets.com.

Join, jury, jerry – there are a lot of J’s flying around this article. And it just so happens that James and John are the first and second most common male names in the United States.  And sure enough there have been six presidents named James and five named John.

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.

One of the most important aspects to placing more business is a knowledgeable underwriting team to be your advocate for those challenging cases.

The Life Underwriting team philosophy is “never say never”.

We don’t give up on a case because it’s difficult.  We take on the challenge and look outside the box for solutions.  This innovation sets us apart from the rest and helps to get more cases placed for your clients.

Here’s one example:

We were presented with case on a 60 year old seeking $1 million of UL coverage with a Long Term Care Rider.  The medical records revealed a history of inflammatory arthritis and the LTC rider was declined:

8/2016 joint pain in hands and feet. He was treated with prednisone and colchicine for presumed gout, but without relief.
Rheumatoid factor and uric acid testing came back normal.
He was then referred to rheumatology, was diagnosed with inflammatory arthritis and prescribed meloxicam. Joint pain improved after 3 months.
He has not been seen since 10/2018; at that time had no complaints of joint pain and was not taking any medication.

Given the time gap since the last visit in 2018 and no updated status of current condition, we went back to the carrier to discuss getting interim details to reconsider. We learned there had been no further episodes of joint pain nor any use of medication treatment since 2016. After review of the updated details, the LTC rider was then approved!  Case was placed!

If we had not gone back to the carrier for reconsideration, the case would have remained a decline on the books.  Another way we made a difference to our broker and the client.

Let our Underwriting Team help you with your challenging cases and generate more sales this year.  We look forward to hearing from you.

The “younger” segment of the LTC Insurance market (people age 45-55) represents a great opportunity to expand your business.

But to be successful, it’s critical to understand their unique needs and concerns around buying coverage.

Doing so can help you to anticipate and overcome objections, present solutions more effectively, and ultimately, create more positive outcomes.  Here’s a helpful strategy to follow:

Know Your Audience

Individuals in the 45-55 age bracket often understand the need for LTC planning, but have not purchased a policy because of perceived affordability issues and/or competing priorities such as future college expenses, retirement planning, or caring for aging parents.

The majority of LTCi sales are to people under 55.  Your biggest challenge is creating the sense of urgency for them to take action sooner rather than later.

Anticipate Objections

When discussing LTC planning with younger prospects, you may hear:

“I’m too young to deal with this right now.”
“Currently, I’ve got other priorities to deal with.”
“I can’t afford to add another bill to my monthly expenses.”

Respond Effectively:  Before you can overcome an objection,it’s important to acknowledge a client’s concern and show empathy.  This demonstrates that you are actively listening to their needs and concerns, which will help to build trust, and ultimately, enable the client to feel comfortable about moving forward.

Move Toward A Decision

Buying LTC Insurance is not an all-or-nothing proposition.  You can take advantage of the flexibility you have to adjust the policy design. Show plan options with a premium that fits their budget.  Here are two sample responses that address common objections:

Why Now Versus Later:  “I hear what you are saying about your competing financial obligations and priorities.  Since coverage is often much more affordable when you are relatively young and healthy, delaying this decision can make buying coverage even more challenging later.  Let’s explore a few alternatives that might help us take advantage of your current age and health.”

Too Expensive:  “I hear what you are saying about the monthly premium and your current budget.  The most important thing is to have some level of coverage, so that you don’t ignore the risk altogether.  Let’s look at some plan designs that still provide a strong level of protection, but better fit your current budget.”

Did You Know?

The average length of an LTC Insurance claim is 2.85 years.  So when the premium cost is the biggest concern, look at different policy designs with a 3-year Benefit Period, which can provide ample and very affordable coverage for the majority of clients.

Contact your LTCi Associate for more resources and materials to help expand your LTCi business.

Are you looking to increase your personal production and income?  One straightforward way to generate additional sales with existing clients is to offer a Disability Income Benefit Review.

Many clients already have group Long-Term Disability (LTD) benefits in place, but are unaware of the potential gaps in coverage that Group Plans create.

Questions Advisors Should Never Over Look During A DI Benefit Review:

How long must the client wait before collecting Group LTD insurance benefits?
What percentage of pay (if any) will they receive during the waiting period?
If partial benefits are provided, do they have to be totally disabled during the waiting period?
What percentage of their pay will they receive from this benefit?
What is the maximum monthly benefit?
Is bonus income or incentive pay covered?
How long are benefits payable?
Will the plan pay benefits if they are working at a reduced capacity?
To what extent will their benefit be taxed?
To what extent will they be responsible for medical insurance premiums and other benefits previously provided by my employer?
Will the benefits be adjusted for cost of living increases?
Can they retain the coverage should they change employers?

With answers to these questions, we can show you how to address the existing gaps in your clients’ coverage, while generating increased earning potential for you.

Contact your DI Sales & Marketing Manager for tips on how to incorporate these questions into your existing client review process.

The term collateral damage was originally used during warfare when a military target was struck.  Even when the attack was successful it often left behind peripheral harmful results – usually affecting nearby innocent civilians.  The phrase is now more broadly used to describe negative unintended consequences of an attempt to do something beneficial.

Life insurance is often used as security on a loan, usually in a business situation.

Urgency of the circumstances (or poor advice) usually results in a creditor simply being added as beneficiary on the policy for the amount of the loan.  The result is a prime opportunity for collateral damage.  Parties to the loan or the policy seldom think to adjust the creditor’s beneficial interest as the loan is paid down or even paid off.  So if death occurs the creditor is unjustly enriched and the remaining beneficiaries are short-changed.  Or a creditor’s beneficial interest can be too easily changed or eliminated without his or her knowledge.

Here are the rules:

Rule #1 – Never secure a loan with a beneficiary designation.  Always use a collateral assignment!

A collateral assignment (C/A) is a formally documented lien on the policy in favor of the creditor who stands first in line for the share of the death benefit described by the terms of the C/A.  But there can be collateral damage from a collateral agreement if things are not done properly.  So . . .

Rule #2 – Use the carrier’s C/A form.

Rule #3 – Get the carrier’s permission before making any modifications on the C/A form

Rule #4 – To avoid the appearance of practicing law, only modify the C/A at the specific direction of the client or the client’s attorney.

Rule #5 – Make sure the C/A is dated after a time the policy is in force.

Rule #6 – Make sure the completed C/A is filled with the carrier, or the carrier won’t know to protect the rights of the creditor if benefits are paid.

Rule #7 – MEC Alert!  Make sure the client understands that if a C/A is filed on a modified endowment contract the amount secured by the C/A is reportable taxable income to the extent of gain in the contract (like a LIFO distribution).

For all its conceptual simplicity, the execution of a collateral assignment usually has many problems as different circumstances pop up with each case.  Call with any questions or for assistance with the drafting, approval and implementation of a collateral assignment at 706-354-0401 or tom@cpsadvancedmarkets.com.

It is a common belief amongst today’s consumers that Long-Term Care Insurance is too expensive.  In addition, they also worry about paying for a product that they may not even need, or end up using.

Thankfully, the Long-Term Care market has drastically changed over the last decade – now many companies offer new products that address and overcome common objections.

Consider coupling a Permanent Life Insurance Policy with a Long-Term Care Rider to affordably cover all your clients needs.

Take this case for example:

Male, age 45, in good health, can purchase a $300,000 universal life policy for family income replacement for $182 per month.  For an additional $15 per month this individual can add a long-term care rider that can accelerate the $300,000 death benefit at 2% per month ($6,000) while living to pay for qualified long-term care expenses.

Now the client has addressed several needs with one policy – he has life insurance to protect and provide for his family and the ability to use the death benefit while living for long-term care expenses should the need arise.  All of this gives him the added piece of mind knowing that a benefit will be provided while living or at death as long as the policy is kept in-force.

For more information about life insurance with living benefits for long-term care contact your Life Sales & Marketing Manager.