Life Insurance

The 5-Step College Funding Combo Plan

Authored by Brian Leising You may have heard about using life insurance as a component of college planning.  You may even incorporate college planning with your client reviews.  Do you explore all the options available with your clients?  These five ideas can lead to writing not one, but several policies per household.  All designed to maximize the use of life insurance in college planning. Step 1  Register to use the Smart Track Tool Kit college planning system through our website.  The Smart Track Toolkit can help your clients learn how to rearrange their assets to optimize money available for college.  It could also assist them with important test preparation, the confusing admissions process, and even choosing the right school.  Combined with the Leads on Demand system, you can place yourself in front of prospects with a great sense of urgency.  Step 2  One or both parents should purchase a life insurance policy with Foresters.  Policyholders become members of the Foresters fraternal organization.  Children of members are eligible to apply for one of 350 competitive scholarships they offer annually.  These scholarships are worth $2000 per year.  Foresters offers a life policy to fit almost any budget, often without a paramedical exam. Step 3  Establish a cash value or return of premium (ROP) term life insurance policy on a parent.  Both offer death benefit protection if the parent dies prior to the child starting college or a lump sum available to pay tuition when due.  For guaranteed cash, ROP term offers a fixed amount on a specified date.  If they wish to grow their money while still providing safety, several carriers offer traditional fixed and fixed index universal life policies.  Many of these include an early cash value option, which enhances the cash available in the early years of the policy. Step 4  Ask grandparents to rearrange their assets in a more tax-efficient manner.  Many grandparents have IRA’s and qualified plans with benefits larger than they will need for retirement income.  Most individuals take their minimum distributions and simply re-invest them only to pay more taxes on that income.  By taking this money and placing it into a life policy, they shelter the money so the income is not included on their tax return, provides tax free loans from the policy and produces a legacy at death. Step 5  Utilize a fact finder that takes college funding into account.  Both ING and Mutual of Omaha have software tools to help you plan the future costs of a college education.  They offer examples of current tuition rates at major universities and estimate future costs based on education inflation.  You can add this estimate into your client’s total needs analysis.

Income Rider Advantages

Authored by Jim Guynan Recently I heard that almost 60% of index annuities sold today have an income rider attached to them. Also, that the average time before the income is activated from the rider is only 1.8 years. What does this tell us about fixed index purchases and income riders? Simply, that more than half of the owners of fixed annuities are thinking about the future use of these assets as possible income sources and they are utilizing it in a new way. Before income riders became available there were really only two ways to access an annuity; a 10% penalty free withdrawal per contract year or to annuitize the annuity contract. Now there is a third option which is activating an income rider payout that will provide an income for the rest of the owner’s life. The advantage of this is that the owner does not give up control of the underlying fixed annuity in order to do so. What is interesting to me is that the average time to activate is so short. Many of the illustrations I run for agents show longer deferral times before income is needed. One explanation could be that only those people who need income now are buying the annuities. As time moves on, I believe that more younger people will become educated on the advantages of the riders and take advantage of the longer deferral.
Sales & Marketing

The “Prosumer” Idea

Authored by Justin Reeves I recently heard a presentation with one of our top carriers about “How Agents sound to our Audience”. It referred to an idea known as “Prosumer”.  In short – the buying public has become a little bit of an expert on almost anything they purchase.  Or at the very least – the consumer feels they know something or because of the current internet environment – they believe they can get educated very quickly on the topic. With this in mind, today’s agent needs to be more savvy.  They need to be on top of their game.  They need to expect that the prospect will already know some terms.  The agent needs to be able to field a higher level of questions and also defend some of the misinformation and attacks on the insurance industry.  Not to mention some of our very own that have contributed to that reputation. One statement that really struck a cord with me was “You can’t read your own label when you are in the jar”.  When you have been at something as little as six months – you run the risk being too technical, too wordy, and tend to use language that does not relate to your audience. So always make the complex – SIMPLE.  Use terms that are very relate-able.  Practice some of your appointment speech on a family member or friend that does not know the industry and get feedback.  If you use these steps – you will see better results.

Misconceptions Regarding Annuity Fees

Authored by David Corwin I read an article recently about annuity fees.  It spoke about most clients thinking that there are fees and that annuities are expensive.  In fact, that couldn’t be farther from the truth.  You will never find a fee on Indexed Annuities themselves, with the exception of GLWB’s of course.  That’s an income rider that guarantees an income to the annuitant for the rest of their lives. The perception that there are fees and that annuities are expensive was probably born out of Variable Annuity customers.  VA’s are the most fee-heavy annuity contracts sold to date.  The typical VA has charges close to 4.5% all together. Those charges are: Administrative Service Charge, Contract Maintenance Charge, Mortality & Expense Risk Charge, Underlying Fund Expenses and optional rider fees. They say that Indexed Annuities are complicated?  Indexed Annuities don’t have prospectuses and they don’t have fees, period.
Long Term Care and Disability Insurance


Authored by Steve Knapp Are you looking at how to unlock the conversation for long term care?  According to Margie Barrie’s book, 50 Ways to Boost Your LTCI Sales, below are some key phrases to help set you apart. 1)      My goal is to provide you with the most appropriate combination of benefits from a highly rated carrier for the most economical cost. 2)      I actually consider this a nursing home avoidance policy. 3)      This policy provides you with choices and control, so you can age in a place and receive care where you want to. 4)      This policy provides the funds and support so that your family will be able to take care of you.  Without it, it will be too hard – physically and financially – for them to provide the care to keep you at home as long as possible. 5)      We represent virtually all of the top carriers in the industry.  So my goal is to provide you with one-stop shopping. I will share with you the pros and cons of each policy and help you select the policy that is best for you. So with these key phrases, unlock the conversation about long term care today.  The more you inspire confidence in your prospects, the more likely they will act on your recommendations and give you a check.  Contact our long term care department for additional support and sales ideas to help you.