Life Insurance

MYTH: “I won’t need life insurance when I retire.”

Presented by Brian Leising

Four responses you can use with your clients.

  1. Really? So, that means you are getting a free funeral?

The last time I checked, it is actually against the law to dump a body in the nearest ditch, bury someone in the backyard or cremate your remains in a giant bonfire (marshmallows anyone?). You won’t die for free. Cremation may cost less than a traditional burial, but morticians and funeral homes still like to be paid for their services. Why reserve dollars you could spend and enjoy when a basic life insurance policy will cover your final expenses for pennies on the dollar? With no planning, you will become a burden to your family. (Unless they’re skilled with large bags, ropes, rocks, have a large car trunk and live near a body of water. Oh, wait, that’s the other kind of Family.)

See response #2 next week.

Life Insurance

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? When you meet with a person who is a grandparent, what photos do you see on their walls? The photos of their children are long gone and the walls are now adorned by their adorable grandchildren. Just try to ask a question about their grandchildren and see if you can get a word in edgewise for the next hour. They love to talk about their grandchildren and would do just about anything for them. Did you ever think to ask “Who handles your grandchildren’s life insurance and college funds?”  Parents may not have thought about these topics and if they did, may not have the funds to pay for them.  Chances are your senior clients have more disposable income than their children and are in a better position to help.  They are at a stage of their lives where their primary concern is leaving a legacy.  Two gifts their grandchildren will always remember will be their first life insurance policy and their college tuition paid for by Grandma and Grandpa. If you have been following my “Six Questions for Six Life Insurance Sales to Seniors” posts, you now have six easy conversation-starting questions to ask your senior clients.  You know what direction the conversations should take and what sales they will lead to.  For resources to implement these ideas, send me an e-mail (bleising@fb-inc.com) and we can discuss further.
Long Term Care and Disability Insurance

A Debate Between Traditional Long Term Care Insurance and…

Presented by Leonard Berthelsen There seems to be quite a debate being waged between traditional LTC products and the hybrids of life and annuity products.  The positive of this is the attention long term care is receiving. I read comments like “I’ll lose it if I don’t use it”.  Yes, there is statistical chance that a client would pass away and not use the product’s benefits with the traditional LTC products.  However, I don’t believe there actually is a large statistical chance especially with long life expectancy and the utilization of home and community care services in a traditional LTC product.  Also, these plans now allow the untrained friends and family care providers to be paid for these services from the policy by many of the carriers.  When all is considered, access to long term care services will probably increase. Yes, asset based LTC products offer a” lock in” when purchased and there would be no future rate increases with that product.  For some consumers, this is desirable.  For many other potential clients, the single premium deposit or purchase is just not in the retirement plan.  Moving a large block of money to have dedicated to LTC coverage certainly is not for everyone.  In certain situations, does the client understand that the first money to get used in a hybrid annuity long term care claim is their own deposit? Traditional LTC products and carriers have a much better understanding of claims, costs, and morbidity than they did five years ago and certainly better than 25 years ago.  Only time will tell if the carriers have it right.  When financial planners and advisors design plans for their clients using traditional LTC products, there are certainly options in those plans that reduce the risk of future rate adjustments. I have even seen comments that there is a concern that when benefits are drawn from a LTC plan, those benefits would be taxed.  Since 1996 when tax qualified LTC plans became part of the LTC insurance landscape, these benefits have been paid tax free.  In the 1995 legislation that gave us tax-free LTC benefits, it also made all plans sold prior to 1996 grandfathered and treated as if they were tax qualified.  This issue has become somewhat of a lightning rod for justifying one design plan over the other. I’m not an advocate for one over the other, they both have their place.  Advisors should recognize that clients have different needs, just as we have different products for those needs.  One is not at the expense of the other.  Both designs can co-exist and both plans can flourish.
Life Insurance

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? Do you need a good way to open up an estate planning conversation with a prospect you think may have a problem?  Maybe a business owner?  Why not ask, “What steps have you taken to minimize your taxable estate to your heirs?”  This is an easy way to lead into the conversation.  You are assuming they have already done some planning.  Most people have not, or if they have it was never completed.  Keep in mind with the higher exclusion amounts that went into effect recently, the Federal estate tax may not apply in as many situations as it did in the past.  Your state may impose its own state estate taxes at much lower thresholds. On top of that, income or capital gains taxes may also apply.  Make sure you are working with an attorney who specializes in estate planning to minimize your client’s taxable estate first.  If needed, life insurance can provide immediate funds to pay any remaining tax without liquidating assets. In part six I will discuss two opportunities that will open the door to your next generation of clients.
Life Insurance

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? The fourth question comes in two parts.  “Where do you keep your safe money?  What is the purpose of these funds?”  Aside from emergency money, many seniors have funds they do not plan to spend in their lifetime.  The money is earmarked for their children or grandchildren and usually not sitting in a tax-favored vehicle.  Many seniors are not aware of the tax implications of their current arrangement.  CD’s, savings accounts and mutual funds lose value every year due to taxes.  Annuities and qualified plans can defer taxes, but that just means the value to be taxed will be greater when received by the next generation.  Why not move those dollars into a vehicle that offers immediate leverage (no need to wait for the funds to grow) and also avoids taxation?  A single premium life insurance policy works perfectly in these cases.  The death benefit will always be greater than the single premium paid by the client and will pass tax-free to their heirs. In part five I will look at some other ways to keep Uncle Sam’s hands out of the transfer of wealth.