Gary Bleetstein Senior Vice President

As we are now in the new year 2022, there is much to be appreciated as well as much to put behind us.

We feel positive about  2022, as we have a resilient industry which not only survived the last 2 terrible years in many respects, but our industry thrived in many ways. Covid Related Life Insurance Claims did not affect the industry the way people thought it would, however, 2020 and 2021 will be historical for the amount of death claims paid out overall.

The good news is that Life Insurance Annualized Premium increased by 18% for Q3 as well as Year to Date.

VUL increased 78% YTD, IUL increased over 20%, Whole Life increased 17% Year to Date and Term Increased 7% Year to Date. GUL decreased by 13% which does not come as a surprise based on current interest rates and carrier reserves.

Covid-19 forced our business to change the way we do business and now, over 79% of Term Business is being done electronically and this is a trend we see continuing. Some carriers are even requiring term business to be submitted electronically and will not accept paper applications any longer.

The other good news is that based on the Pandemic, there has been a substantial increase in consumer awareness and interest in our products and services.

All of us at Agent Support Group wish you and you families a safe, healthy and prosperous 2022 and we thank you for your business and support.

By Jay Scheiner JD CLU
Executive Vice President
Agent Support Group

Do you sell life insurance?  Even if your primary occupation is financial planning, or P & C, annuities or medicare products – if the sale of life insurance products is in your quiver – then you can learn from the best there ever was.  “Nobody ever died with too much money.”  ~Ben Feldman

The late Ben Feldman was arguably the greatest life insurance salesman ever.  During his 50 year career, Feldman created wealth for his clients while protecting their families and businesses.  He was the first individual to sell one billion of insurance.  This Yogi Berra of the insurance world used memorable expressions that are as true today as when they were decades ago.  Here are some of these gems:

Estate Planning:  “Your estate represents a lifetime. Is it worth keeping?”  May I show you what happens to most estates?  Every person has an estate.  Your estate is made up of all of your assets: home, cars, business, life insurance, bank and investment accounts, retirement plans, your furnishings and collections – all of your possessions.  Estate planning is the process of arranging for the management and then distribution of your estate during your lifetime, during a period of disability and at death, while minimizing gift, estate, generation skipping transfer, and income tax.  Your estate plan design is determined by your desires. The ultimate goal of estate planning is Control.  How can you keep control of what you have spent a lifetime accumulating?  How can you make sure the bulk of your estate is passed on to your family? If you don’t have an estate plan the government has one for you – their plan, not yours.

Investment Strategy:  “Most people have two problems…first to accumulate and then…to conserve”  These days, nearly everyone has investments (if only inside their employer’s retirement plan).  However, few have an investment strategy.  Of those who do, it is rare that it is built around their individual needs and objectives.   Building an investment strategy involves reasonable expectations of return coupled with an appropriate tolerance for risk.  An investment strategy looks beyond the traditional three asset classes of stocks, bonds and cash.  Whether you aspire to fund a child’s education, leave a lasting legacy or retire in a financially secure manner, a good investment strategy begins with clarity of purpose.  Having investments is not the same as having an investment strategy.

Business Solutions: “Ever to stop to think your business will last only as long as you do?” How can a person make sure their business is passed on to their family and not to their creditors or the government for taxes? That’s really the bottom line, keeping your family and business together in the event of your death. Certainly there’s a price tag on doing something to protect your life’s business venture. But the price tag on doing nothing may be much higher. Somebody has to pay. If not you, then your family.

When asked, “what is the largest policy you have ever sold?” Ben would reply: “I haven’t sold it yet!” Feldman has been mentioned in the Guinness Book of World Records, been the topic of numerous articles, authored Creative Selling for the 1990’s, and his selling approach was the main focus in The Feldman Method.   Ben’s power phrases used during his career became industry standards.  His positive approach to a buyer’s interest rather than just selling policies is something you can emulate today.

Sam Kaufman, President, Agent Support Group

The sparring continues in Washington on the fate of the new tax legislation that will be effecting businesses and individuals alike.   The new legislation will effect the pocketbook of all Americans with the primary beneficiaries being the accountants and attorneys that will reap the benefit of increased fee revenue.   Most of the talk in the life insurance industry has been centered around the changes initially proposed that reduce the estate tax exemption, a potential boom for life insurance sales.  However, last week new legislation was drafted that would maintain the current estate tax exemptions and unified credit in addition to maintaining the current laws concerning Grantor Trusts.   If you are through with your current novel or are not watching football this weekend you can thumb through this draft https://rules.house.gov/sites/democrats.rules.house.gov/files/BILLS-117HR5376RH-RCP117-17.pdf  It’s only 1684 pages and will make your weekend complete.

Certainly we have not heard the last of the proposed tax changes and 2022 promises to be filled with more controversy.  The good news is that new legislation brings everyone back to ground zero, as it is out with the old and in with the new.  This creates the perfect opportunity for advisors to engage with their clients and other professionals.   Engagement is the key to new opportunities and your call will be welcomed as an opportunity to discuss pertinent changes that may require action by a client.   This is a perfect opportunity, don’t let it pass you by.

Agent Support Group is always here to assist advisors and is glad to participate in assisting advisors with their clients.   Take advantage of our over 50 years in the life insurance industry – It’s free.

Gary Bleetstein
Senior Vice President
Agent Support Group

The current agenda being discussed in Congress has some proposed changes that if implemented, will give you a reason to talk to your clients about their Estate Planning needs and their Life Insurance.

As noted in recent articles, Democratic lawmakers wish to tax estates worth $ 5.85 million or greater which reverts back to the 2017 exemption limits. Currently, estates of over $ 11.7 million are taxed. An estate tax is based on the transfer of wealth from a deceased person and is enacted before beneficiaries receive their inheritance. Today, the federal estate tax of 40% applies to estates above $ 11.7 million for single filers and above $ 23.4 million for joint filers. There are even some states that also impose additional estate taxes.

Over the last 20 years, the exemption has progressively increased as the number of estate tax returns filed have decreased. In 2020, only 1,900 taxable returns were subject to federal estate tax, down from just over 50,000 returns in 2001 according to the data from the Urban-Brookings Tax Policy Center.

The per-person exemption was $675,000 in 2001 and is now at $11.7 million. The effective estate tax in 2018 was only 16.5%.

Reviewing these proposals is a great reason to start a conversation with your clients regarding their overall Estate Planning and Life Insurance Planning needs.

Now is the time to begin the conversation, and all of us at Agent Support Group are here to assist you with your clients current and future Life Insurance Planning needs.

By Jay Scheiner JD CLU
Executive Vice President
Agent Support Group

We at Agent Support Group remember the 20^th anniversary of September 11, 2001.  As a premier life insurance brokerage agency based in Midtown Manhattan, we were there during the chaos of that day and the aftermath.  Many of our producers lost clients when the terrorists attacked the towers.  We lost friends.  Some in our agency lost family members.  An insurance company partner lost her spouse – another his sister.  Several knew firefighters and first responders who perished.

I’m familiar with one advisor specializing in life and disability in the corporate arena who lost 51 clients at Cantor Fitzgerald.  He was supposed to meet with them on the 105^th floor of the North Tower on the morning of September 12^th.  A friend of his was fired from Cantor Fitzgerald on the 10^th.  Imagine how a day of difference can mean the difference between life and death – and could change a family’s future forever.

At Agent Support Group we work with insurance professionals to show them how to best protect their clients.  We look for the gaps in current coverages and always try to put your client in a better place than they were in before.  We know what the power of life insurance can do for a family, a business or an estate.

Life insurance has meaning – life insurance saves families.  If there was ever a time to think about the good your work does – it is now – on this special and solemn 20^th anniversary of 9/11.  At Agent Support Group we remember those who were lost and those who made the ultimate sacrifice for others.

Sam Kaufman, President, Agent Support Group

The best sales concepts are often those that have been tried and true.   Life insurance as an “Asset Class” is a sales concept that has withstood the test of time and I was reminded of it recently when an advisor requested Survivor Life illustrations form clients ages 72M and 70F.

Looking at the chart below one can easily see that the death proceeds provided in this SUL plan proposed easily exceed many conservative alternative investments.  Further, they are all guaranteed.  Perhaps the only element that is not guaranteed is death.

This is a very compelling argument when meeting with a client or their financial advisor as it is difficult to argue that an alternative investment, not subject to market risk, could come close to providing a similar IRR.

We went one step further by flexing the premium to provide coverage for a lower premium that would increase substantially if the insureds lived beyond 92/90 and the IRR increased to 9.93 at ages 92/90.

At Agent Support Group we model plans of life insurance to tell a story.  These are not just illustrations, they provide alternatives for the client and their advisors and help in refining the final model that meets the client’s objectives.   This results in creating greater inter-action and more than just a sale.

Gary Bleetstein
Senior Vice President

While this month we are celebrating our Independence going back to July 4, 1776. This was an historic time in our great nation’s history and we continue to celebrate our freedom.

Now in 2021, we have several other vitally important items to celebrate. These include our closer approach to independence of the Covid-19 Virus that has tried to put our world at a complete standstill – we should and need to be grateful for the great science and vaccination strides the US and the World have made.

As a Brokerage General Agency in the Independent Field of Life Insurance Distribution, we are also grateful for the many amazing strides our end of the business has made over the last 40+ years.

The difference in an Independent Advisor or Agency vs a an agent or agent for a career carrier is simple- The Independent Advisor or Broker clearly represents the ultimate client with Best interests of the client as the background, where the Agent represents the carrier and therefore has in some cases, less choice to offer his or her clients.

Over 20 years ago, there were 1,200 or more Life Insurance Carriers manufacturing and distributing products. As a result of pure financials, de-mutualization, Mergers and Acquisitions, and running after stock prices, the number is greatly reduced. Furthermore many of the old traditional Life Insurance Companies have merged, sold old blocks of business or just left the business completely.

And while the products being sold have shifted on a cyclical basis, most recently with the low interest rates and move away from GUL, Whole Life, IUL, VUL and Term Insurance have taken the lead. The industry is seeing growth in all of these areas of products as well as a clearly defined market for Linked Benefit Long Term Care planning.

The point here is simple:

We all must continue to celebrate Independence Day, July 4^th but we must also celebrate our great accomplishments as Independent Life Insurance Advisors as well as celebrate what we are all hoping will be the end of Covid-19.

Our industry has made great strides in these areas and we all need to stand up tall and remind the world and our clients that Independent Life Insurance Brokerage can change someone’s life- forever and we need to be grateful for all that we have and that we have accomplished.

Gary Bleetstein, Senior Vice President, Agent Support Group

Gary has more than 30 years of experience in the BGA marketplace and is a Sr. VP and  principal of Agent Support Group, an Amerilife Company  — a multi-office Libra Partner agency located in New York and New Jersey. He is a past board member of NAILBA, and presently a member of the Forum 400, Finseca, NJFPA and New York City Life Underwriters. Gary can be reached at Agent Support Group, 420 Lexington Avenue, NY NY 10170. Telephone: 212-292-5765. Email: gary@asglife.com.

By Jay Scheiner JD CLU
Executive Vice President
Agent Support Group

I’ve always been fan of Bill O’Reilly’s “Killing Series.”  Even though I knew the endings, books like “Killing Lincoln,” “Killing Kennedy” and “Killing the SS” brought history to life.  Lately, those Killing books made me think about how trends in our industry and forces beyond our control, including federal tax changes, are trying to kill retirement as we know it.  Specifically, the rise in popularity of 401(k) accounts that are replacing the traditional pensions which protected retirees in prior generations, the stress on the Social Security Trust Fund and the struggle for Americans to save enough for retirement.  We as insurance advisors have an obligation to show clients solutions they can use to prevent the killing of their own retirement.

According to author Nathaniel Lee (CNBC How 401(k) brought about the death of pensions) Americans have saved about $6.5 trillion in 401(k) accounts, representing nearly one-fifth of the U.S. retirement market.  Since the 1980s, 401(k) accounts have effectively replaced pensions to become one of the most popular retirement plans for American workers for the 60 million Americans who participate in them.  “It’s part of what we call the three-legged stool of the U.S. retirement system, the other two parts being Social Security and private savings,” said Anqi Chen, assistant director of savings research at the Center for Retirement Research at Boston College.  Until the 1980s, most Americans planned for retirement through traditional pensions. They were defined-benefit plans, where employers saved on workers’ behalf and calculated employees’ retirement benefits based on their years of service and final salary.

With traditional pension, the risk is all on the employer or the pension fund. The pension fund trustee has to figure out how many years on average the people in the pension fund are going to live and has to tie the benefits to projected earnings, said economist Monique Morrissey.  That changed when Congress passed a new tax code in the Revenue Act of 1978. The act included a new provision in the Internal Revenue Code, Section 401(k), which gave employees a tax-advantaged way to defer compensation from bonuses or stock options.  Unlike traditional pensions, 401(k) plans are defined-contribution plans. Employers create a retirement plan in which their employees can contribute a portion of their wages on a pretax basis, up to an amount determined by the IRS and the employer typically makes a small matching contribution.

What changed?  We went from a system where the employer in the private sector paid for the entire pension and took on all the risk to a system where the worker in the private sector took on most of the cost and all of the risk.  401(k) and other defined-contribution plans like it quickly replaced traditional pension plans. From 1980 through 2008, participation in pension plans fell from 38% to 20% of the U.S. workforce, while employees covered by defined-contribution plans jumped from 8% to 31%, according to the Bureau of Labor Statistics.  “Within a decade, the majority of workers overall were in a 401(k) rather than a traditional pension,” said Morrissey.

How can you best advise your clients?  With one leg of the stool weakened – pensions replaced by less robust 401(k) – and the 2^nd leg (Social Security) in danger or at a minimum stressed to the limits – the most effective way you can help your clients is to make sure they reinforce the third leg – private savings.  We as advisors have important tools to offer clients to reinforce the third leg.  We can offer annuities and innovative life insurance products that are tailorer for each client’s specific needs.  We can protect their families while saving for their future with whole life, indexed universal life and variable life.  We can show clients not only ways to accumulate wealth for their retirement, but structured methods of distributing their money and interest back to them on a tax-favored basis through annuitization or disciplined withdrawals from life insurance products.

Yes, with the death of traditional pensions and the social security system stressed, it’s up to advisors to show clients what is available and to help plan for and secure their retirement.  Killing retirement will only occur if they fail to plan and if we fail to properly advise them.

Gary Bleetstein
Senior Vice President

How many of these carriers can you remember and recall doing some business with:

• Executive Life
• Home Life
• Phoenix Mutual
• Metropolitan Life
• The New England
• Equitable Life
• Genworth – First Colony Life
• Lincoln Benefit
• Jefferson Pilot
• ING- Voya- Reliastar
• National Benefit Life
• Standard Security Life

Well, each of these carriers and many others have changed – either purchased, gone out of business, re-organized, demutualized and other items. This has not been a good trend in our business however it continues to steamroll, especially with the current trend of Private Equity firms purchasing either entire carriers or blocks of business. And you know what has happened to many of these “closed” blocks of business.

• Changes in crediting and dividend rates- in some older cases no dividends are being paid at all by some former major carriers.
• Increased costs of insurance and changes in which products a term policy may be converted to.

So far in 2021,$ 12.1 Billion has been spend by Private Equity firms to purchase Life and Annuity Carriers or blocks of business. In 2020, there were 191 Private Equity Purchases of these blocks of business, more than any other year and nobody can really tell us what will become of these books of business.

Even recently, KKR has purchased Global Atlantic, Blackstone has purchased Allstate and Apollo has purchased Voya Annuities it appears the end is not near.

So what does this mean to you and your clients ? It means that as an advisor, it is very important to review a client portfolio each year and where necessary and prudent, and diversity the Life Insurance Portfolio for a better selection of risk and cost factors.

While most carriers pay claims, the costs of staying with a stale carrier and product can be enormous.

With new regulations, low interest rates and higher than expected mortality, the days of GUL are almost over and new and more efficient products for the carriers and in some cases for the consumer include Whole Life, IUL with long term guarantees and Variable UL with Lifetime Guarantees.

When you mix and match these products to your client needs, it can make for a great sale and some additional protection for your clients- and this is why policy review and diversification are so important in todays marketplace.

By Jay Scheiner JD CLU

Could life insurance rates skyrocket? As the COVID-19 pandemic continues to impact the health of people throughout our country and the world, producers are questioning how the virus will affect life insurance pricing for their clients going forward. I spoke with several industry experts and actuaries – here’s what I found…

COVID has made it harder for many to get a new life insurance policy. Insurers considered immediate and significant pricing hikes on rates in the short-term, but we have not seen this. Instead, some insurers have stopped selling insurance to individuals over a certain age or above a certain rating class, rather than taking a singular pricing action. This withdrawal from selected markets (the populations most at risk for COVID deaths) is how many insurers defensively dealt with the virus early on in the pandemic.

While all insurers experienced losses as a result of a spike in mortality from early 2020 to early 2021, some realized a less dramatic increase in claims because many of the COVID deaths were from populations that tended to no longer be insured (the elderly) or insured for more modest face amounts. There is also the reality that many of the deaths that have occurred from COVID in the elderly or sick populations would have occurred anyway. Companies specializing in term insurance experienced less of an impact than those concentrating on permanent coverage.

Is the spike in mortality short-lived or will it be a continued threat to insurers? The industry pros I spoke with point to the record-breaking development of highly effective vaccines as a game-changer; they believe in the ability of those pharmaceutical companies to also modify the vaccines to combat COVID variants. However, the big question is whether the industry will actively price into a life product the possibility of new and wholly unrelated pandemics years or even decades into the future – and at what cost. As former CDC Director, Virologist Robert Redfield, stated recently, “there will be another pandemic, guaranteed.”

There are less direct but related factors affecting mortality as a result of the COVID-19 pandemic and lockdowns: 

• People have been reluctant to see their personal physician and specialists for routine examinations and screening tests
• Impact of effects of “COVID Syndrome” where the illness carries a lasting impact on the body which can ultimately impact mortality
• The increase in alcoholism and drug usage seen as a result of lockdowns

A few unforeseen benefits uncovered during the pandemic:

• The near disappearance of the flu and reduction in the common cold in the US last winter, likely due to mask-wearing, frequent hand-washing and social distancing
• Many young and healthy people can now purchase significant amounts of insurance without an exam or bloodwork – some carriers have raised these non-medical limits to multi-million dollar levels

Ask your client, does the COVID-19 pandemic make it more important than ever to have life insurance? The answer will probably be, yes. We don’t think that COVID-19 significantly changes the answer to whether your client needs a life insurance policy. Life insurance has always been necessary for anyone whose death would result in financial strain for a family member or business, or anyone who depends on someone else for financial support. Your clients should have enough insurance to replace that support for as long as it is needed. Married couples, even those without children, can also use life insurance to ensure that each spouse can maintain their prior standard of living even if the other passes away.

So, will life insurance rates skyrocket as a result of the COVID-19 pandemic? According to the sources I spoke with, the answer is probably no. But combining the COVID-19 burden with other pressures the insurers are currently dealing with, such as sustained low interest rates and increasing regulation, there is now a pronounced upward trend in life insurance pricing.

The bottom line is that your clients should buy while they can qualify, and sooner rather than later, as it is unlikely we will see rates as affordable as they are today.

Jay Scheiner is Executive Vice Present of Agent Support Group, an AmeriLife Company.