By: Gary Bleetstein
Partner, Agent Support Group

Every time I see a new email from a Life Carrier or BGA, it is usually associated with either a new IUL product but most recently, with new Underwriting Technology.

The question is, will this new technology take the place of the Life Insurance Advisor?

Most advisors do not even know the difference in E Applications, Drop Ticket or Accelerated Underwriting Programs not to mention GI programs using Bots !

I attend meeting after meeting on these subjects and I must say, there are two answers- NO and in some instances Yes.

Let’s start with Yes first –

Yes, the new Underwriting Processes will assist with the smaller term and UL sales for ages 60 or 65 and less for healthy insured’s. This may or may not even be a market for you.

However, what happens when either a carrier or agent goes direct to the insured via a bot or new technology- who will help the insured get all of the answers they need? Surely no bot that I am aware of can do that, and many of these programs are only taking 30-40% of the applicants. Up to 60% will still need regular underwriting?

The client at that point may need to speak with an advisor.

Now let’s look at the NO – Technology will NOT Remove the need for the Advisor?

For your more substantial clients and those with even moderate health issues, tell me the name of a Bot who can talk to an underwriter about the A1C or Hemoglobin Levels, or even the build of a client? What about a split dollar plan or premium financing? Can an underwriting program assist a client with these issues? I think not.

My firm and I have done our homework on these issues and we feel strongly that the industry will continue to find a way to streamline the underwriting process, but this does not mean it has found a way to streamline the need for the advisor.

There will always be a place in this great business we are in for the advisor who can truly add value to a sales and underwriting process and I feel strongly whatever programs come out of carriers, there will be a good spot of advisors in the Life Insurance Industry.

The Promise of Kilimanjaro

By: Jay Scheiner
Partner, Agent Support Group

 

Agent Support Group (LifeMark) is pleased to announce that ASG Partner Jay Scheiner’s new book, The Promise of Kilimanjaro, has been released on Amazon and is receiving early accolades and five star ratings.

With a Forward by insurance industry legend Joseph Jordan, author of Living a Life of Significance, The Promise of Kilimanjaro is not just a story about a mountain.  Africa’s highest peak is the backdrop for this surprising memoir of a man driven to pursue a challenge of significance. You’ll scale an 800-foot cliff, and flash back to D.E.A. training alongside Nicaraguan Contras. There’s an attempt to sail the Atlantic solo, the terror of falling off a moving boat in open water, and the lure of a precious stone.

The book reminds us of the frailty of life and the importance of the peace of mind that we, as insurance advisors, offer to our clients. The Promise of Kilimanjaro – a true story that will inspire, even if you never plan to set foot on a mountain.

You can learn more about the book and purchase it by clicking HERE for the Amazon link .

By: Sam Kaufman
Partner, Agent Support Group

2018 will be the start of an era of rapid technological change for the life insurance industry, an industry that has been lagging behind others in the financial service arena.   Technological change will affect the way every advisor does business going forward and our relationships with the companies.   Those who choose not to navigate the new technology super highways will be left behind in a cloud of dust. 

Early in the year many companies will be introducing advanced accelerated underwriting programs that will require the advisor to utilize an electronic application for submission.   In other words, no electronic application then no access to the accelerated program.    One company has already announced that they will be offering their portfolio of products up to age 65 for amounts up to 2,500,000 for all underwriting classes, standard or better, via the electronic process.   Electronic submission and accelerated underwriting are the result of companies and agencies alike needing to reduce their upfront costs for acquiring business.  

Michelle DellaPia joined ASG in November to lead our electronic application advisor training and submission processes.   ASG is devoted to making certain that its advisors are able to take advantage of all the latest technological processes and not miss the train as it pulls out of the station.  

This is just the beginning of a five year period where vast changes will be effecting the way advisors do business.   Artificial Intelligence (AI) will become the norm and although there are many privacy issues surrounding its implementation, you can expect that may applications will be underwritten in “Robot” like fashion.   The primary goal is to achieve enhanced customer satisfaction and make the application process easier and more efficient. 

Enhancing customer satisfaction on the front end will be easier than the post issue service which continues to be an area that creates a multitude of problems.    Many of these problems could be reconciled if the companies would come together on the way post issue transactions are processed.   When you realize that every company has its own change of owner/beneficiary form, you begin to realize the seriousness of the problem as this, in itself, only serves to create questions and in the end dissatisfaction.  

The next big area to require change is the 1035 Exchange process.   Today when I get to a checkout counter, the person asks were you able to find everything you wanted and hope you come back.   When you leave a life insurance company via a 1035 Exchange, they kick you in the backside and ask you never to come back.    I don’t quite understand this philosophy as it appears contrary to enhancing a customer experience.    Banks clear checks in a matter of hours and life insurance companies take a minimum of 20 days to process a 1035 exchange.   

Like usual I am probably preaching to the choir, but as a good preacher I wish my congregation of loyal advisors the best for 2018. ASG will always be here to help.

 

By: Gary Bleetstein
Partner, Agent Support Group-11-17

 

While Long Term Care is not the easiest topic to discuss or write about, it is one of these things in life that will be weighing on many families for many years.

Yes, people are living longer, however, we must consider their overall conditions and if a parent or sibling is living longer because of a Long Term Care issue, is this any better for society.

November is Long Term Care Awareness Month and it is for this reason I wish to try and point out some important items and issues with Long Term Care.

By now, we should all know how Long Term Care needs are becoming a larger part of our business, even in the high net worth markets. Costs for Long Term Care at home or at a facility are escalating with no real reductions in costs at this time.

The National Median Annual Costs for Long Term Care are –

·       $ 91,250 for private room in a nursing home ($ 7,600 monthly)

·       $ 80,300 for a semi-private room in a nursing home ($ 6,700 monthly)

·       $ 45,760 for Licensed Home Health Aid ($3,800 monthly)

·       $43,200 For Assisted Living ($3,600 monthly)

Let’s just look at one situation – a 75-year-old with full onset of Alzheimer’s. Choices for care become limited without a tremendous amount of family resources and money. Of course most prefer to keep a patient at home rather than in a facility- but this is not always possible. Should the patient require a nursing home in the major cities in the Northeast- these costs can run over $12,000 a month or $ 144,000 a year. If the cost of care for this individual is for 4 years – the costs could be $ 576,000 easily. Where will this money come from? and in the Northeast – these costs could be $ 750,000 or more.

Will it come from and adult child, a spouse, or a domestic partner? or Should you and your client consider protecting assets now and purchasing Long Term Care with Guaranteed Premiums and Benefits? 

I feel strongly that whether a client purchases Long Term Care or Chronic Illness Care- it is our responsibility s advisors, to show our clients what is available to them.

The type of products I recommend to advisors are:

·       Life Insurance with LTC or Chronic Illness Riders – with costs that are guaranteed

·       Linked Benefit Products that provide either single pay or limited pay options for Life Insurance, Annuities with Guaranteed Long Term Care costs and benefits. 

While this is an area of our business that can be difficult to discuss, we need to also realize that it is our job to help educate our clients to assist them in mitigating future risks and what better time to do this than right now –

Long Term Care Awareness Month

Have a Safe and Wonderful Thanksgiving

Insurance by Selfie!

Jay Scheiner, JD, CLU, Partner
Agent Support Group/LifeMark

Insurance companies can’t keep up with buyers’ demand for instant product gratification; even “accelerated” underwriting programs aren’t fast enough for some consumers. Meanwhile, companies have an interest in eliminating costly exams and lab fees. So, 21st Century tech to the rescue! Enter Chronos, a new technology from Lapetus Solutions, Inc. (LSI), the science and technology company that uses facial analytics to estimate life expectancy, with an approach similar to what advanced law enforcement uses to predict how a fugitive may age over decades. The client submits a selfie to the insurance company and the insurance company provides an indicative quote for life insurance.

A selfie reveals more than whether it’s a good hair day: facial lines and contours, droops and dark spots could indicate how well you’re aging.  A photo may reveal early signs of heart disease, diabetes, or even dementia. It can help estimate your body mass index (BMI), determine your physiological age (how old you look), and indicate whether you’re aging faster or slower than your actual age.  A selfie can even hint at whether you smoke, or smoked in the past.

If a proposed insured applies for coverage with a carrier that uses Chronos, the theory is that buying a policy online could someday take only minutes; clients may also avoid a paramed exam and labs. Many insurers are looking into this new technology, but the makers of the system are reluctant to disclose which ones just yet. “[Chronos] may or may not meet the vetting process to make carriers comfortable,” says Robert Kerzner, present and CEO of LIMRA.

Facial analytics that can predict life expectancy have the potential to revolutionize life insurance underwriting, as the technology may prove as accurate in predicting risk as current methods, and additional electronic checks such as the MIB, MVR or prescription drug database might be used as a cross-check. Chronos could also streamline the process of buying insurance by reducing the number of questions clients have to answer, another sore spot for consumers. BUT – while the newswires have lit up over the past six months with articles and press releases about selfie insurance being here, THEY’RE WRONG! I can’t find a single carrier that will actually write a policy based on this technology right now.  I was told by one senior insurance executive

exploring Chronos that they’re now just using it for analytics.  When someone takes the selfie quote on their site, the responses go to the insurance company, which through the technology will give the person their facial age; then the information gathered goes to Lapetus for beta testing and data collection to expand their research. I was told they then delete the information. Hope so.

Will insurance-by-selfie replace traditional underwriting procedures or even the newer rule engines that companies are using to access risk and make underwriting decisions? Probably not. Could it become another tool that insurers can use to assess risk and streamline the process? That’s more likely.

And then there’s the further concern that insurance-by-selfie can become another way the industry attempts to bypass the agent in transactional insurance sales. It’s possible. One of the insurance carriers we represent has the system in the testing stage. Ominously, the company executive announcing it on LinkedIn has the title, “Vice President, Direct-to-Consumer Distribution.”

Smile and say “cheese.” This is one story we should all keep watching…

===================================================================================

Sources:

–      How your Selfie could affect your life insurance, USA Today, Barbara Marquand, NerdWallet, April 25, 2017

–      Can a Selfie get you quicker life insurance coverage?,  Accuquote.com, Byron Udell, May 2, 2017

–      Underwriting Life Insurance with a Selfie, GlobalData, Danielle Cripps, News Archives 2017

–      Interview of a confidential source (We’ll call this officer “Deep Selfie”) who is a top executive at a major life insurer, September 26, 2017

by: Mark D. Milbrod, CLU
Principal, Agent Support Group-September Blog

 

September is Life Insurance Month and in the spirit of that, I felt it was important to repost the following…

Many years ago, while attending an industry meeting, I was listening to a talk being given by one of the platform speakers.  During the speech, the speaker was talking about the industry as a whole and the importance of what we do for a living. He then proceeded to read the following to the group:

A life insurance policy is just a time-yellowed piece of paper, with columns of figures and legal phrases, until it is baptized with a widow’s tears. Then it becomes a modern miracle, a sort of Aladdin’s Lamp.

It is food, clothing, shelter, education, piece of mind.

It is the sincerest love letter ever written.

It quiets the crying of a hungry baby at night. It eases the heart of a bereaved widow. It is the comforting whisper in the dark silent hours of the night. It is a new hope, fresh courage and strength for the widow to pick up the broken threads of life and carry on.

It is an education for the sons and daughters (a chance for a career, instead of the need for a job). It is a father’s parental blessing to his children on their wedding day. It is the function of a father’s hopes and dreams for his family’s future.

Through life insurance he lives on. There is no death. Life insurance exalts life and defeats death.

It is the premium we pay for the privilege of living after death.

Although it is a bit dated and arguably a bit corny, it is powerful nonetheless. This piece was written back in 1929 by Jack J. Leterman, who established the first John Hancock Agency in the state of Virginia. As a 30 year plus veteran in the industry, I was extremely taken back by these words and have had them framed in my office ever since. I take any opportunity to share these words with as many life insurance professionals as possible.

What we do is so unique and powerful. These words are the core of what we do and I believe today, more than ever, it is so important to spread the importance of these words to our clients. This is what life Insurance was intended to do but as we all know, it has become so much more than that.

Not only does it accomplish the most simplistic form of protection to surviving spouses and children such as, Income Replacement, Mortgage Protection, or College Funding. It provides solutions to a host of other, more complex problems facing our clients today. Whether we use Life Insurance to provide liquidity for heirs of larger estates, provide Supplemental Retirement Income, funding Buy/Sell Agreements, Key-Man Protection, etc., we are positioned to use this powerful product to find solutions to these, and other planning challenges.

With uncertainties surrounding us, it is a great feeling to know that we can provide so much in the form of “piece of mind” with a simple stroke of the pen.  Although the words above are over 80 years old, the core principles behind them truly capture What Life Insurance Really is.

It is Life Insurance Awareness Month so keep that in mind when you are speaking to your clients.  Perhaps this can further put things into perspective for them.

 

Find more of Mark’s Bark’s Blogs on our website: http://www.asglife.com/insurance-view/marks-barks-blog/

“GET THE DRUMS OUT”

By: Sam Kaufman
Partner, Agent Support Group

 

September is the month for advisors to get the drums out and march up the avenue to create awareness.   Advisors should be proud that the benefits paid from life insurance policies contribute to the wellbeing of American families across our great country.   Allowing families to continue undisrupted following the loss of a breadwinner.

However, somewhere we have all failed to beat the drums loud enough and over 40% of Americans remain without life insurance protection.    Why is such a large percentage of the population uninsured?   The most prominent reason is probably the fact that most advisors are not interested in writing a $500 annual premium even though they may be creating a future relationship that will purchase a larger policy later in life.  

Think about the New York Yankees, a team that was laden with aged plays two years ago.   Do the Yankee teams of the past resemble your client base, aged and not likely to purchase additional life insurance?  Everyone has marveled over the “Baby” Yankees, they hit, they run, they play baseball.    Just think how many home runs you could hit if your client base included some “Baby Bombers”. 

The second place advisors fail is in policyholder engagement.   As a General Agent we keep advisors informed about the status of the policies written with ASG.    We prepare reports detailing term policies that are approaching the end of their level premium period.   I hate to tell you where those reports go and where the later premium notices go.   Think what would happen if you called the client and they indicated they had another child or that they started a new business.  Perhaps this is old fashion, but it works.  

We need to be proud of the product we sell and take joy in the fact that life insurance provides the financial security for families and businesses to continue following a significant loss.   So get out there and march up the avenue beating your drums as loudly as possible this month.   Make more people aware of the services you provide and the need for financial security.  

by: Mark D. Milbrod, CLU
Principal, Agent Support Group-8-17

 

 

We have all facilitated cases with 1035 Exchanges.  They are very simple.  A client has an old life insurance contract with cash surrender value.  We roll that money into a newly issued contract, carry over the cost basis and negate any taxation at the time of the transfer.  The benefits of the lump sum coming over usually acts as a subsidy to either lower future outlays, increase guarantees and in some cases rescue some under water or heavily leveraged contracts.

But in today’s robust product environment, we can add an additional layer of benefits that was previously not available.  There are a number of life insurance products today that offer Long Term Care or Chronic Illness Benefits.  These products come in a lot of different flavors:

  • LTC Rider (LTCR) add-ons for Guaranteed UL, Indexed UL or Whole Life
  • LTC Rider (LTCR) add-ons for Survivorship Guaranteed UL or Survivorship Whole Life
  • Chronic Illness Rider (CIR) add-ons for Guaranteed UL, Indexed UL or Whole Life
  • Blended Life Products (Single Pay or Limited/Flex Pay)
  • LTC Riders on Non-Qualified Annuity Contracts

 

Individual or Survivorship Products w/LTCR or CIRs:

For the most part, the life insurance contracts with an LTCR or CIR allow a facility to accept IRC §1035 Exchanges from any qualifying product.  The qualifications are usually limited to the new policy bearing the same Insured/Owner as the policy releasing the funds.   This should make the conversation fairly simple with most prospects.  If they have an existing product that offers only life insurance benefits and it has a Cash Surrender Value, you can provide another layer of living benefits through the LTCR & CIR that had not previously existed.  In the majority of cases, you will often lower the out-of-pocket cost to the policy owner, but even if the new on-going premium was the same or slightly higher, you are providing so much more in terms of benefits that the client will likely go forward with the exchange.

 

Blended Life Contracts:

Another area where there are high potentials for sales is in the Blended Life arena.  These contracts also allow for IRC §1035 Exchanges.  These products are more LTC focused and offer a modest life insurance benefit while still meeting the definition of life insurance under IRC §7702.  These types of sales are typically unwritten on a non-medical basis via a client phone interview and a series of field underwritten knock-out questions.  A good prospect for this type of product may be an older client with an in-force life insurance policy(ies) with cash value but a shift in need that is less life insurance focused and more LTC driven.

 

Annuity Products:

The last area to focus on is the annuity marketplace.  There are annuity contracts that can offer LTC benefits as well.   These types of transactions have a few more rules associated with them, but are classified as viable annuity to annuity exchanges under IRC §1035.  The key component is that these contracts have the same taxation as it relates to withdrawals and death benefit payouts to beneficiaries.  However, the true benefit comes in the form of potential tax-free LTC payouts.

 

When it comes to IRC §1035 Exchanges, there are so many benefits that you can offer your clients.  Today however, with the Living Benefits available, there are additional opportunities that are often overlooked.  The idea of adding on Long Term Care or Chronic Illness benefits to the exchange can surely start some great conversations.  Based on experience, this is something that is not well known, not only amongst professionals in our own industry, but with referral sources such as Estate Attorneys, CPA’s and Trust Officers.

 

Don’t miss this opportunity.  By adding the LTC/§1035 Exchange topic to your daily discussions, you can boost your sales by showing your clients and prospects how they can Have Their Cake and Eat it Too.

  

 

 

Find more of Mark’s Bark’s Blogs on our website: http://www.asglife.com/insurance-view/marks-barks-blog/

 

Back to School

by: Mark D. Milbrod, CLU
Partner, Agent Support Group-August 17

It’s the start of August and I have already seen my first “Back to School” store displays and television commercials.  Even though I haven’t been to school in years, for some reason, those three words always make me cringe. 

Back to School though is all about preparing.  You need to gather all of your supplies so you can hit the ground running in an effort to stay focused on your schoolwork so you can succeed in the coming school year.  That makes me think about our livelihoods.  Are we prepared for “our school year?”  Do we have the tools we need to succeed? Are we preparing enough?

Back to School symbolizes the end of summer.  And it is true that most people move at a slower pace during July and August.  It is often associated with a slowdown of business.  Clients are on vacations and it is harder to get in front of them.  But come September, we have to be careful so that we are not utilizing that time to slowly get back into the groove.  Because before we know it, it’s the end of the year and we can fall short of our goals.  Just like those students, we need to be prepared so that our success can be achieved. 

What steps are you taking now to hit the ground running?  With all of what’s going on in our Industry today, it is truly a great time to be a part of it.  There are so many unique ways in which you can help your current/potential clients. 

Here is a sampling of the types of products and services that you can provide today…

* Policy Audits

* Complimentary Business Valuations

* Loan Rescue Programs

* Premium Finance Strategies

* Supplemental Retirement Planning

* Guaranteed Income Planning

* Longevity Planning using Non-Health Triggers to use Death Benefit as Cash

* Uncapped LTC Pools

* Guaranteed “Cash Back” Life Insurance

These are some hot buttons that we are widely using to generate tons of client meetings that are turning into tremendous sales.  If there is something on the list that you want to know more about, we would be glad to assist you.  Use this time for your “Back to School” planning.  Learn more about the items on this list and how they can turn into meaningful client encounters.

Back to School is all about preparing.  Use these resources wisely.  Do your Homework now and identify potential prospects so that in September you will hit the ground running and have an amazing last quarter of 2017!

Happy Selling