Annuity Hybrid LTC Plans

Presented by David Corwin The Need: Let’s say you have evaluated the possibility that you will need long-term care at some point in the future and concluded that purchasing long-term care insurance to cover at least a portion of long-term care costs might make sense in your situation. You are, however, concerned about paying premiums for insurance coverage that you may never need. Alternatively, you may have several needs competing for the dollars you have available to invest. A Possible Solution: You may be interested in a newer generation of long-term care insurance that blends several types of insurance coverage in a single contract. These “hybrid LTC” policies, also known as asset-based plans, combine the benefits of an annuity with the availability of long-term care benefits should you need them in the future. Annuity/LTC Hybrid Plan: With an annuity/long-term care plan, you purchase a single premium deferred annuity, usually with a lump sum deposit. You choose the amount of long-term care coverage you want (generally 200% or 300% of the amount of your lump sum deposit) and how long you want the coverage to last (usually two to six years). You must also decide if you want to include inflation coverage for the long-term care benefit. If you never need long-term care services, the annuity can be redeemed for its accumulated value at its maturity date, or it can be left to accumulate at interest and the long-term care benefits will remain available. When you die, your beneficiaries may inherit all or some of the accumulated annuity value, depending on any long term care benefits paid during your lifetime. Assuming you have the liquid assets available to purchase a single premium deferred annuity, your financial advisor can assist you in designing an annuity/LTC hybrid plan that fully funds at least a portion of future long-term care expenses through an annuity that has the potential to increase in value for the future benefit of you or your heirs. Taxation of LTC Hybrid Plans: New tax rules that went into effect on January 1, 2010, clarified the taxation of LTC hybrid plans, including: Tax-Free Payment of Long-Term Care Benefits: The cost of any long term care benefits charged against the cash value of an annuity contract will not be includible in gross income, but will reduce your investment in the contract. Tax-Free Exchanges of Existing Annuity Contracts: If you have an existing annuity contract that you do not need for other purposes, you can exchange it on a tax-free basis for an LTC hybrid plan. Tax-free Section 1035 exchange requirements can be complex. In order to avoid unforeseen and/or negative tax consequences, you should seek professional tax advice before implementing a Section 1035 exchange.

Six Questions for Six Life Insurance Sales to Seniors…

65142-header Presented by Brian Leising Do you have senior clients? Did they purchase only one product from you? Was it a Medicare Supplement, annuity, long term care or final expense policy? If you were able to uncover the need for one insurance product, could you uncover another? What if you had six simple questions to ask your clients that would uncover additional sales? “When did you last review your life insurance policies?” You should ask this question of everyone, whether you think they have a life insurance policy or not. Many people have never reviewed their old life insurance policies and they may be paying too much or not enough. Their coverage could be too low or missing key features. I often see older universal life policies that have not been funded properly to keep them in force for the client’s full life expectancy. I have also seen cash rich whole life policies that do not offer enough leverage for the client’s dollars. Newer universal life plans with a no-lapse guarantee can help in both cases. Find an annual review fact finder you like and start filling it out at every appointment. You will help your clients and uncover more new business than you have in the past. In part three, I will review one of the newer added features that can give your clients more than just death benefit protection.

Be the “Quarterback Advisor”

Presented by Life Marketing Many agents love sports analogies when talking about business – I know I do. Well, here is one that you might relate to. We have all heard to be all things to our clients. Many have tried, only some have succeeded. Still others may wonder what does this mean. Have you ever been the “Quarterback Advisor”? In football, all offensive plays run through the quarterback (QB). He doesn’t necessarily make all the plays; sometimes he hands off to the running back or throws it to the receiver. All calls from the coaches run through the QB and he is a part of everything. In most cases, the games are perceived to be won or lost due to the QB’s efforts. Let’s examine how this works in the insurance/advisor business. You want your clients to think of you every time they have a financial or business need. If they need law advice and don’t know where to turn – they call you. If they need a CPA to assist on taxes – you hope they call you. Business insurance, financial planning and the list goes on and on – do your part so that they think of you. Being the “Quarterback Advisor” means you are a connection maker. You know all the best people for the job for your client even if it isn’t you. Always strive to be the one they think of first. These are the types of qualities that go beyond just the sales part. It will pay huge dividends.

Six Questions for Six Life Insurance Sales to Seniors…

Presented by Brian Leising Do you have senior clients? Did they purchase only one product from you? Was it a Medicare Supplement, annuity, long term care or final expense policy? If you were able to uncover the need for one insurance product, could you uncover another? What if you had six simple questions to ask your clients that would uncover additional sales? Let’s start with the first, most basic question, “What planning have you done for your funeral?” Listen to your clients speak. They may discuss their will, preferred cemetery, music to be played, what funeral home to use. When they finish, follow up with “How will your family pay for all that? Do they really want to pay full price?” This conversation could lead to a fully underwritten life insurance sale, but don’t neglect basic final expense policies. Some people don’t need anything more than a basic burial plan. In lower income households, that may be the only sale possible. Premiums are guaranteed to remain level and underwriting is simple and fast. You should know whether your client qualifies for coverage before you walk out the door. People still purchase pre-paid funerals from funeral homes. You can offer them greater leverage on their dollars. Next time I will review question number two, for use with people who already have life insurance policies in force

Life Changes

Presented by Rich Mangiameli Change is something that will happen to you and me in our lifetime. It might be a new home, a job/career change, the birth of your child or grandchild, the need for care of your parents, spouse or even you. It might be a divorce or the death of a loved one – whatever change life has to offer us, it will either be a pleasant or a difficult time. What you need to remember is that your clients are going through these changes in some form or fashion, and as an agent, it’s important that you keep up with their current life events and changes. It is also important that you review annually with each of your clients changes in goals, assets or needs, which means that you need to be there with the advice to protect, guarantee and plan for the future. And, it’s important that you always review the BENEFICIARIES of their life insurance, annuities, IRA’s, 401k, pensions, CD’s and other investment assets to be sure that in the event something happens to your client, those assets are distributed to the person(s) they really want it to go to. Remember, the Last Will and Testament does not override the Beneficiary Designations that might have been set up years ago.