Life Insurance

Taxes are on sale right now

Three life insurance sales ideas to help your client take advantage before it is too late

Federal income taxes are on sale right now

2018 Federal income taxes are historically low. Between 1932 and 1986 the top income tax rates were usually above 70%, even spending 15 years above 90%! Rates have been considerably lower for the past three decades. The new tax law (The Tax Cuts and Jobs Act) lowered rates yet again.

Why these low rates can’t last

Congress built increases into the new law. Due to the method Congress used to pass the bill, the individual tax cuts fade over time and become net tax increases starting in 2027. Deficits are predicted to top $1 trillion in 2023 and the National Debt is expected to exceed $33 trillion in 2028.

At some point the additional debt caused by the current Congress will need to be paid. Federal revenue will need to increase to handle this problem. If your clients were hoping for a lower tax bracket in retirement, they might want to rethink that strategy.

How can life insurance help clients take advantage of this low tax window?

It makes sense to pay taxes now and not in the future when they will likely rise. Your clients need a retirement plan that can help them do that. They only have a few choices available, including life insurance, Roth IRA’s and Roth 401(k)’s. The Roth options include limitations not found with life insurance products. Life insurance is unique in that money inside a policy is not subject to current or future taxation is structured and distributed correctly. The Federal government places no age restrictions on access to this money.

Sales Ideas for Young Professionals

Your clients should place their retirement contributions into an index universal life policy to take advantage of the tax treatment listed above. This age group likely does not need extra deductions today as they qualify for several already (mortgage interest, student loans, deductions credits for children). Additionally, due to the arbitrage power of variable loans, index life insurance contracts should out-perform traditional options. The index accounts shield money from downside market risk while allowing for upside growth.

Sales Idea for Pre-Retirees

Most of your clients 10-15 years away from retirement did the popular thing and placed their retirement money into Qualified plans. Since they must pay taxes on this money at some point, why not begin paying taxes on some of this money now? If they delay, both the accounts and tax liability will increase. These clients can cap their taxes today and still enjoy growth. If they are already over 59 ½ they can begin withdrawals from their qualified plans immediately. Withdrawals should be staggered over several years to lessen the annual income tax. If they are below 59 ½ they will need to follow 72(t) rules and take no more than a calculated amount each year to avoid the 10% penalty tax.

Sales Idea for Established Retirees

Some of your retired clients have money they will not spend during their lifetimes. These dollars are earmarked for future generations but are not in the most effective vehicles for that purpose. The money is probably in bank savings accounts, CD’s or even annuities earning low rates of return. You could move the dollars into a wealth transfer index life policy for greater leverage. Your retired clients do not have the life expectancy to grow the asset to an amount equal to the death benefit after taxes. If the vehicle is tax-deferred or tax-qualified, why not pay the taxes at today’s low rates? They could save their heirs unnecessary taxes. When these clients pass away qualified assets will likely pass to adult children during their peak income earning years. They should lock in this tax expense at a low rate today and enjoy a 100% tax-free benefit in the future. An index product eliminates downside risk while allowing for growth as cash values increase.

Life Insurance

Ensight Webinar

 
 
 
Put Some Life into Your Life Insurance Presentations
The first proposal visualization platform, providing an intuitive, interactive customer experience. Put Some Life into Your Life Insurance Presentations. Increase Customer Understanding & Sales Conversion.
How Do I Start?
Want to take a look? Here’s a virtual tour of the presentation system. These presentations are available to all contracted agents through Financial Brokerage.
 
Annuities

Ready for a change?

Have you been watching the financial markets lately? It seems that volatility has returned in a big way which is great for CNBC. However, it can be a little scary for most of our clients. It’s also a good time to discuss crediting strategies for indexed annuities. The S&P 500 point to point options have become very popular over the years, because the index is recognizable and they are easiest to explain. Nevertheless, the S&P 500 options are steadily becoming overshadowed by alternative strategies. Maintaining a diversified portfolio is considered an effective strategy in reducing risk. One carrier we partner with offers an index option using underlying components consisting of Equity, Bond Futures indices and Commodity indices. It shifts its underlying components and uses rules based methodology on a daily basis for the highest return given a level of volatility. Also included is a risk control mechanism which seeks to maintain a 5% volatility target on a daily basis and constantly reduces the weight of the portfolio and rebalances it with a cash component. New strategies provide a compelling story as to why the index may outperform the more common S&P index. It may be uncomfortable to think about changing your strategy recommendations, but we’re here to help walk you through it. These strategies can be a nice compliment to what you are already using in your business practice, and diversification is a word that clients are hearing a lot about in financial news reporting.
Life Insurance

Ensight Proposal Visualization Software

 
Ensight™
Proposal Visualization
 
 
The first proposal visualization platform, providing an intuitive, interactive customer experience.
 
 
Put Some Life into Your Life Insurance Presentations
Has a life insurance illustration ever lost a sale for you? As insurance producers, we look at pages of numbers every day, we know what they mean, we know how to interpret them. But think back to the first time you ever saw a life insurance illustration. What did you think? I’ll bet you had no clue what you were looking at. Your client has the same problem. It’s no wonder some delay taking action to “think about it,” or would “like to study this illustration further.”
Increase Customer Understanding & Sales Conversion
With the prevalence of the internet, paper-anything is obsolete. Everyone has a smart phone or even a smart watch. In fact, over eighty-three percent (83%) of consumers learn visually. Customers have new expectations and prefer a visual, digital buying experience. What if you had a software presentation that could captivate your customers and take them on a personalized, interactive journey?
What’s The Solution?
Assurance’s Ensight™ Proposal Visualization platform provides visually stunning, compliant proposals to help you sell more permanent life insurance. It is the perfect medium for communicating complicated insurance topics to prospects and customers. You can interactively walk clients through a beautiful on-screen graphical presentation of illustrations, easily comparing the best side-by-side. Ensight is perfect for face-to-face meetings or virtual engagements through Skype™ or Go To Meeting™.
What Does It Look Like?
The new software from Ensight ™ brings your clients’ numbers to life. No more black and white ledger lines. Now values are represented by a colored line that spans the client’s lifetime. Better yet, the presentations are interactive. By moving your mouse, your client can see several different values during any policy year. They can see their cash flow for supplemental retirement income, the internal rate of return in fixed asset alternatives and the leverage gained with wealth transfer policies.
Need Another Reason?
Enhance Compliance With Policy Comparison and Data Retention
In this age of compliance with the best interests of the client in mind, the Ensight ™ Proposal Visualization platform makes compliance with the emerging regulatory environment easy. All comparison proposals are tracked. A full digital audit trail is automatically archived in the Cloud, including a revision history. If you do need the full compliant illustration, it’s still there for you, just a click away.
How Do I Start?
Want to take a look? Here’s a virtual tour of the presentation system. These presentations are available to all contracted agents through Financial Brokerage.