Get To Know Your Clients Better – Use Our Sales & Marketing Resources

Every client is different.  Every client’s needs, goals, family situation, budget, risk tolerance, health, and protection concerns are unique.  What motivates your clients?  And why does it matter?

Two big reasons why you want to learn what truly matters to your clients are:  1) You can better design solutions to meet their needs, and  2) You can use this information to motivate your clients to implement your recommendations.

When you know which questions to ask, and learn detail of what your clients would like to accomplish, you start to get a clear picture of what matters most.

You must be willing to ask the discovery questions and be patient with the clients’ responses.

A few of the classic, high-level questions are:
  • What do you want your retirement to look like?
  • What kind of legacy do you want to leave?
  • How do you plan on taking care of your children if something happens to you?
Or, you can try a question or two that might normally be outside your comfort zone, such as:
  • What keeps you up at night?
  • What are you most passionate about?
  • What is important to you about life?

You might be surprised what you learn by asking questions you’ve never asked before.

Contact your Life Sales Representative today to learn more about the tools and resources we have available for you.

Life Insurance For The Small Business Market Restrictive 162 Executive Bonus Plans

The traditional 162 Executive Bonus Plan is one of the simplest and most popular executive benefits offered in the small business market. The bonus is tax deductible and has few regulations and reporting requirements.  This makes the Executive Bonus Plan extremely attractive to many business owners.

The bonus needs to be considered reasonable compensation in order for it to be deductible, but other than that, the business owner has complete flexibility.

Who is covered and the level of participation is completely discretionary, plus the commitment to the contribution can also be flexible.

Even with all of the positive attributes of Executive Bonus Plans, some employers continue to have concerns.  Many employers are concerned about not having control of the asset (the policy), which is owned by the employee.  The employer may feel that unlike other executive benefit plans, there is nothing to tie the employee to the company, no “golden handcuffs.”

Though employees have an incentive to stay with the company in order to continue receiving premium bonuses, some employers may feel that the bonuses paid are “money out the door.”  Further, they may fear that the employee may handle ownership of the policy irresponsibly.

A potential solution for the employer who has these concerns is the restricted executive bonus plan

The Restricted Executive Bonus arrangement is designed to give the employer some degree of control over the employee’s access to the policy during employment.

The restrictive bonus may be approached in many ways; however the most popular method is through a restrictive endorsement to the policy.  Using the restrictive endorsement, the employee agrees to sign an endorsement form, which becomes part of the policy.  The endorsement states that the employee will not exercise certain ownership rights in the policy; usually for a period of years or until the employee reaches a certain age.

It is extremely important that the endorsement signed by the employee not grant any ownership rights to the employer.  The only way the premium/bonus can be deductible to the employer is if there are no ownership rights with the employer.  If the business had any ownership rights, the business’ deduction of the premiums would be jeopardized.

The restrictive bonus should be used sparingly

And only in cases where the employer has expressed significant concern over the lack of control perceived under a standard executive bonus arrangement.  In addition, the employee participant may feel as though the benefit is less compelling since the bonus is already taxable (causing an out of pocket expense in a single bonus situation) and the benefits are not immediately accessible.

In some cases, a restricted plan may even have the opposite effect from the intended goal of tying the employee closer to the company.  It is more practical to use the double bonus, or gross up bonus, when the restrictive endorsement is used. In this situation, the cost is zero and the plan should continue to be compelling to the employee.

The bottom line is that executive bonus is a great way for employers to reward and retain key employees.  The restrictive bonus can be used sparingly when the objection of “money going out the door” arises.  Either way, executive bonus is a great sales concept for the small business market and can generate significant commissionable sales to the producer.

Contact your Life Sales Rep for more information.

Keeping Up With The Joneses (Of Life Insurance)

The landscape of the Life Insurance Industry is changing more rapidly than ever, leaving many producers to play perpetual catch-up when it comes to the latest products and guidelines.

Many are quick to dismiss newer products such as Hybrid Term-UL or Equity Indexed Universal Life citing that they are too complex and have too many moving parts, or that they won’t stand the test of time.

When gauging the relevance of a new product or new enhancement, one can look at whether or not some of the largest, oldest insurance carriers are making these new products available in their product portfolio.

Equity Indexed UL Products

These products have a multitude of uses and ways to benefit the client and sales of IUL are growing considerably each year.  According to LIMRA, sales of Index UL Insurance have grown 192% over the years, which represents an average of 38% growth each year.

These IUL sales will be used to provide supplemental retirement income, help pay for a loved one’s secondary education expenses, provide affordable death benefit protection with cash value accumulation potential or even act as a 401K alternative with no downside market risk.

If you have not sold Indexed UL or have not taken the time to learn how these products work, you should contact us to familiarize yourself with the various carrier product offerings.

We have contracts with several A-Rated Carriers who have an IUL product (some with Guaranteed DB and others without) for sale.

It’s clear that producers and clients alike are warming up to the IUL product and sales continue to trend upward.  As a producer it is important for you to be knowledgeable of any products available and be able to make recommendations as to when these products are suitable.

We can help you better understand IUL, its uses and it’s best selling points.  The next time you have a client who is looking for something more than Term or basic GUL, you may want to consider an IUL product alternative.

Call us today for product information or case design for any of your clients.

Protect & Grow

Today’s clients understand the need for life insurance as a tool to use to protect their families, but they are concerned about taking on premium payments that will reduce their ability to save for retirement.

They also realize that Social Security, pension plans and other assets might not be enough to maintain the standard of living they are accustom to throughout retirement.

Clients and prospects need your assistance with finding solutions that will address all of their needs.

One strategy that can be used to help them meet both death benefit protection and retirement goals, is to use a combination of plans that consist of term and cash value life insurance.

Term life insurance plays an important role in the plan

Term life insurance reduces the costs associated with the total amount of life insurance necessary.

Cash value life insurance, when properly structured, also provides death benefit protection for the life of the insured, and has the potential to provide tax advantaged supplemental retirement income.

Clients want to protect their families and plan for retirement – they need your help.  By combining low cost term with cash accumulation life insurance, clients are protected against the losses associated with an early death, and provided with supplemental income during retirement.

To discuss the benefits of combining term and cash value life insurance further, contact your Life Sales Rep.


3 Concepts That Will Place More Life Cases

Life insurance is more than just a death benefit – there are numerous living benefits attached to life insurance which are available before the funeral procession ensues.

During retirement, consumer attention often shifts from income replacement and mortgage protection to concerns about outliving retirement income and health care costs.

Three common pre-retirement uses of life insurance are:
  • College Expenses
  • Supplemental Retirement Income
  • Long-Term Care Expenses

A properly designed Indexed Universal Life (IUL) can help you win more cases by providing customers with options they can use while living.

Simply put – IUL’s can provide clients with access, growth and protection at any age

ACCESS: Liquidity window for access to tax free cash withdrawals.

GROWTH: Non reportable tax-free retirement savings linked to well known indices like the S&P 500.  Clients can’t lose money when the market goes down.

PROTECTION: Flexible death benefit provisions that policy owners can utilize for income, health care costs and ongoing care through the chronic illness rider.

Contact your Life Sales Rep today to learn how to position these game changing features of life insurance in your customer presentations.

We welcome the opportunity to guide you through the options of new life insurance policies and help you place more of your cases.