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a renaissance for replacement sales

Posted by: Adam Cavalier on 7/15/2014 | 0 Comments
Over the past 10 years, one common source of new business for a producer has been the replacement sale. Effectively, if the same outcome can be achieved for a lower annual premium, or if a better outcome can be designed for the same out-of-pocket outlay, then why wouldn’t a client act?
Categories: Life/LTC

decumulation and selling into a loss

Posted by: Adam Cavalier on 7/2/2014 | 0 Comments
Most of you will understand the term selling into a loss. Decumulation? Maybe not.

It is, however, a much more descriptive term than “the income phase” as it is literally the opposite of accumulation. As such, certain things that work in a client’s favor during the accumulation phase – like dollar cost averaging – work against them during decumulation.

During decumulation, dollar cost averaging becomes selling into a loss, and it can spell big trouble for an investment portfolio.
Categories: Life/LTC

living and dying with dignity: the right combination of life, LTC and critical illness

Posted by: Adam Cavalier on 6/11/2014 | 0 Comments

We have discussed the merits of Long-Term Care and Chronic Illness Riders in this forum on more than one occasion, always in an effort to understand the nuances that differentiate one offering from another.  The hope, of course, is that there is a clear winner.

The reality, unfortunately, is much more complicated.

Consider some of the elements that we have discussed previously:

> The potential challenges presented by the need for any claims under a chronic or critical illness rider to be based on a “permanent” impairment

> The specter of future premium increases in traditional Long-Term Care insurance policies

> The challenge presented by asset-based, single pay contracts that may be out of reach for some clients without significant liquid assets

> The uncertainty at claim time based on mortality discount factors that accompany some chronic and critical illness contracts

There is no one solution without a chink in its armor.

Categories: Life/LTC

overlooked life insurance opportunities in your state

Posted by: Adam Cavalier on 5/28/2014 | 0 Comments

This is a guest blog written by Justin W. Smith, founder of the insurance consulting firm, Balanced Strategies, LLC. Smith is a guest blogger for us that focuses his research on using life insurance to guard against the biggest threats to wealth preservation.

Opportunities abound as it relates to the sale of life insurance. The economic climate is causing many to reevaluate their portfolios and seek the unique attributes that life insurance affords.

Consumer demand continues to trend upwards, however, that does not necessarily mean our industry is effectively connecting with customers. Consider these amazing data points from a recent LIMRA study, Trillion Dollar Baby:

  • 14 million households indicated the reason that they had not yet purchased the insurance they believe they require is that they had not been approached by any advisor about life insurance
  • 8 million U.S. Households indicate that they “don’t have enough life insurance”
  • 29 million households say they were likely to buy life insurance in the upcoming 12 months
  • The 44% of households who feel they do not have enough life insurance, on average, say they need enough insurance to replace 6 years of income
Categories: Life/LTC

from joint to single filer: unintended tax consequences for surviving spouses

Posted by: Adam Cavalier on 5/8/2014 | 0 Comments
This is a guest blog written by Justin W. Smith, founder of the insurance consulting firm, Balanced Strategies, LLC. Smith is a guest blogger for us that focuses his research on using life insurance to guard against the biggest threats to wealth preservation.

 

Earlier this year, I wrote about the need for considering tax diversification in retirement planning. The tax-erosion of retirement income is something that every retirement planner needs to take seriously.

Building on that theme, planners must consider the potential tax-effects of the first spouse passing away during retirement, leaving the surviving spouse with unintended consequences that can dramatically affect their lifestyle.

Categories: Life/LTC
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