By Jay Scheiner JD CLU
Executive Vice President
Agent Support Group

We at Agent Support Group remember the 20th 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 105th floor of the North Tower on the morning of September 12th.  A friend of his was fired from Cantor Fitzgerald on the 10th.  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 20th 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.

Happy Independent’s Day!

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 4th 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.

 

Killing Retirement

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 2nd 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.

By: Mark Milbrod, CLU, CLTC

March is here, and with it, the annual College Basketball  phenomenon, March Madness  begins.    Every year the sports world goes crazy as this gets under way.   But we in the Insurance and Financial Services Industry have our own March Madness (and every other month for that matter).   With what we have all experienced this past year, the word MADNESS has never been more fitting.

If you follow college hoops or you simply get caught up in the hype, it can get pretty exciting.  We are all familiar with the visual of “the brackets”  that start at the beginning of the tournament.  64 teams start off and we follow the brackets as they wind down to the infamous Final Four.

When it all starts, I find the brackets to be overwhelming and a sensory overload.  There is so much happening on one sheet of paper and in the actual tournament, similar to our industry.   So here’s a look at Our March Madness and how it looks in my head…

Wow!  That’s a bit much, but it is the MADNESS that we face every day, every month and throughout the year.   This has been especially relevant over the last several months for all of us.  We have experienced an unprecedented pandemic, a crazy election process and enough psychological changes that will permanently alter the way we conduct our practices.

What carrier do we choose?  Why one over another?    From our perspective, each of the carriers have their own niches, whether it is product related, an underwriting strength or a particular feature or benefit that sets them apart.

What product design do you choose?  There are so many to choose from;  a dwindling Guaranteed Universal Life (GUL) market, Indexed Universal Life (IUL), Whole Life, Term or Hybrid Life to name a few.  Each has its own bells and whistles which make them so unique and adaptable to a number of planning and individual client needs

On the political landscape, we don’t know what’s going to be. Will there be a drastic change to the estate planning world? What will come of the existing exemption limits, etc?

That all leads us to knowing where the Sales Opportunities are.  In the center of our brackets, there are four areas where all of these opportunities converge, Asset Repurposing, Estate Planning, Policy Audits and Legacy Planning. 

It is easy to be overwhelmed by the “brackets” we call “Our March Madness.”   We scratch our heads as we try to sort it all out.    It is truly overwhelming and it fosters that sensory overload I mentioned earlier.  Where are the Sales Opportunities?    They are all there, staring us right in the face.

Surely, we will continue to face challenges as we enter this new stage of the pandemic.  But one thing that I have learned over this last year is that we, as an industry, continue to be resilient and as strong as ever.  We have many resources available to us to succeed.

Having a partner that can guide you through all of this is key.  At Agent Support Group, we have the expertise to walk you through it and help you Make Sense Out Of All The Madness.

Sam Kaufman, President, Agent Support Group

The first 60 days of 2021 have been very exciting and point to this being an exceptional year for ASG and many of our advisors.

Traditional Guaranteed Universal Life products have all but disappeared from the portfolios of many companies.   New forms of GUL are appearing in variable and indexed universal life products that offer clients both guaranteed premiums and death benefit in addition to cash value accumulation.  ASG is able to work with your broker dealer and still provide you the same underwriting and design expertise for variable life products  as we do on traditional life products.  Find out how competitive GVUL is before seeing your next client.

More companies start to limit products in New York.   The most recent company to withdraw many products from New York is John Hancock.   If you have a pending sale involving any John Hancock product other than term or Accumulation UL make certain that the application is submitted as soon as possible.   Don’t be surprised to see other companies follow John Hancock’s lead in New York.

Agent Support Group is also expanding its annuity portfolio with the addition  of a Fixed Indexed Annuity designed by Nationwide exclusively for Amerilife, our parent company. Peak 10 offers two exclusive index options from Alliance Bernstein and JP Morgan plus a guaranteed participation rate for ten years.  Give ASG a call and we will provide you additional information about this exciting product.

More exciting news is coming in coming months so stay tuned.

Gary Bleetstein
Senior Vice President

While 2020 has been a year of change and huge challenges , it has also been a year for the life insurance industry of pivoting to remain in competitive positions of writing life insurance. With the Covid-19 Virus getting our attention in March, it is still at the top of the list for distractions in  industry including the Life Insurance Industry.

With more and more employees of carriers and distribution working remotely, the challenge has been how to create more sales as the statistics have shown more young people are re-considering their life insurance needs. This also goes for Final Expense products.

The good news is that we have succeeded. While premiums are flat and there has been a change in the types of life products not only being offered but purchased, the distribution and ease of purchasing life insurance has evolved. Yes, term insurance for younger people has increased, premiums have decreased yet sales of VUL have soared to our wildest expectations.

Agent Support Group has been following this trend towards more electronic, exam free  fluid free accelerated underwriting and we are exciting about introducing VIVE- an end to end, Drop Ticket Platform for Term Insurance from many of the top carriers.

Vive is an exclusive platform only available to BGA’s who are members of Libra and their advisors. Libra is one of the leading IMO’s in the life insurance marketplace today and this exclusivity is important.

With the Vive platform an advisor will be able to quote, share a quote, and within 5 minutes, submit an order via an electronic application that from that point forward with be handled by the carrier of choice and our ASG case managers.

This platform is cutting edge and we hope you take advantage of it. Click Here to see a demo of how Vive work.

ASG will be sending out some information on Vive and our formal introduction will be via a Webinar on March 2nd – you will all receive an invitation and hope you do join us. PLEASE SAVE THE DATE – MARCH 2ND – 10 AM EST.

In conclusion, while our lives have been disrupted and changed in 2020, we are looking forward to a sate, productive and better 2021.

New Year – New Opportunities

By: Mark D. Milbrod, CLU, CLTC

 

As we enter this new year, there will certainly be many changes.  And as always, with change comes opportunities.  You can either be part of the glass half empty camp or the glass half full camp.   I always choose the half full side.

Changes are already happening at a very fast pace in our industry.  We have seen more contraction in the GUL space with more carriers withdrawing their products.  This is mainly due to a couple of factors; the continuing low interest rate environment and tighter reserve requirements being placed on the insurance carriers.  With an incoming democratic President/Administration, we will likely see some changes as they relate to the Estate Tax and other regulatory issues affecting the products we sell.

There are some good things coming down the pike.  And believe or not, it is positive and there is a silver lining.  Here is some of what to expect:

  • To replace the GUL, there are several IUL chassis that will have very competitive Extended No Lapse provisions all the way to age 100.
  • A new simple to use Term Insurance platform called Vive. Under this proprietary platform, you will be able to quickly and efficiently submit your business with dramatically fast turnaround times.
  • Due to some year-end tax code liberalization, insurers will be able to expand premium thresholds for purposes of Section 7702. This will be a boom for Whole Life insurance sales with larger Non-Mec limits.
  • Continuation of NON-MED underwriting programs to further your ability to provide products to your clients as we navigate through more of the pandemic.
  • We have seen somewhat of an easing on some of the previous COVID underwriting rules. Some of these changes have expanded issue ages and/or face amounts.
  • Re-pricing and lowering of some term rates.
  • Introduction of a new Proprietary Annuity Product
  • New Webinar Series for 2021

As we did last year, we as your partners at ASG, will continue to keep you informed about the things that matter to you most.  Timely sales ideas, product and industry news will be vital to your success for 2021 and beyond.

The previous year had its challenges but through it all, we were there to assist.  But like any year, challenges bring opportunities.  Together, with the optimism of that glass half full, we wish you a Very Safe, Prosperous and Happy New Year!