Trends in Life Insurance

September 3rd, 2015, No Comments, be the first ».

In this interview, Saybrus’ Kevin Kimbrough discusses the trends shaping life insurance and how advisors can use life insurance in retirement planning.

Advisor Today: What economic, demographic and market trends are shaping life insurance policies today?

Kevin Kimbrough: Today’s life insurance products reflect a variety of recent economic, demographic and market trends. These include: Baby Boomers retiring at a rate of more than 10,000 a day as well as increasing longevity and rising health-care costs.

In addition, the increase in the estate-tax-income threshold has created new legacy-planning opportunities, and the prolonged low interest rates have caused carriers to shift from secondary guarantees to cash-value accumulation and other benefits, such as combination policies.

Clients today are concerned about having enough money in retirement and are looking for long term care insurance (LTCI) alternatives and savings vehicles that offer tax advantages–areas where life insurance can offer some help.

AT: How are life insurance policies being used by consumers in light of these trends?

Kimbrough: Whether or not the estate tax is a planning factor makes a big difference in how life insurance can be utilized. Clients who are still above the threshold and subject to the estate tax will likely need to own their life insurance within a trust, which pretty much limits its uses other than as a wealth-transfer vehicle.

However, for the many more people who are now below the threshold, they can own their policies outright and potentially use the funds for various purposes other than the death benefit.

One common use we’ve seen is for LTC benefits. We are also seeing strong growth in accumulation sales, where consumers are buying life insurance because of its unique tax advantages in order to supplement retirement savings. For the most part, these clients still want to use their life insurance to leave a legacy, but they also desire more flexibility and access to the funds.

AT: What new life insurance features are facilitating the use of life insurance in retirement planning?

Kimbrough: There are a number of features available in the market that can be used in a retirement-planning context. One trend we have seen is the strong proliferation of life and LTC combination products over the past five years. There are now many combination products offering different levels of coverage, ranging from tax-qualified LTC benefits to chronic-illness benefits that are included in gross income.

Another trend is the movement from guaranteed universal life insurance with living benefits to accumulation products with living benefits.  Nearly all companies have tried to shift their permanent insurance business to less capital-intensive products. This shift has also aligned with a more optimistic client perspective. Consumers today are significantly more interested in cash-value growth as opposed to five years ago, when security and guarantees were a higher priority.

AT: How can financial advisors sell the use of life insurance in retirement planning to their prospects and clients?

Kimbrough: The first step is to identify the clients who might benefit the most–generally high-income earners, ages 35 to 55 (or older). Like any other sale, it starts with a conversation and getting to know their needs, along with what they are currently doing.

Identify any gaps by looking at what they are able to save by fully utilizing traditional retirement-planning vehicles versus what they want to save in order to maintain or enhance their lifestyle in retirement. At the same time, get to know their concerns, particularly any relating to income taxes and LTC needs.

For many successful clients, life insurance can provide an opportunity to protect loved ones during the working years, while supplementing retirement savings on a tax-advantaged basis and protecting against potentially catastrophic LTC costs.

Kevin Kimbrough, CLU, manages Saybrus’ sales training and advanced-planning teams, business-development functions and external sales force. He previously worked for Phoenix as a wealth-management consultant and a regional managing director. 

Actor and Comedian Anthony Anderson Is On Board for LIAM. Are You?

August 31st, 2015, No Comments, be the first ».

AndersonAnderson’s message is clear: Your families matter, and life insurance matters

By Maggie Leyes, LIFE HAPPENS

September is Life Insurance Awareness Month, and actor and comedian Anthony Anderson (who was just nominated for an Emmy for his role in black-ish!) is going to be front and center. As the national spokesperson for the LIAM campaign, Anderson will be sharing his personal story of how he and his family were directly impacted by life insurance.

And the best part is: you get to share his story, too—via video or flyer. Life Happens, which coordinates Life Insurance Awareness Month each year, has produced a consumer video that will be running nationally as a public service announcement. You can share it with your clients and prospects using the link: www.lifehappens.org/anthony. If you prefer, you can share the story as a “flyer;” it’s available as a downloadable PDF. In addition, there is a PDF flyer with a great, behind-the-scenes look at this Hollywood star in the form of a Q&A. (Get these at www.lifehappens.org/liam)

In all these pieces, Anderson’s message to consumers is clear: “Your families matter, and life insurance matters. It’s how your loved ones are taken care of if something happens to you.”

Use the power of social media to reach out this September

Because social media is such a powerful tool, Life Happens also has created some great social-media graphics, which are perfect posts on sites like Facebook. They feature Anderson and his wisdom about life insurance.

New this year is a complete social-media calendar for September. It has a prewritten post or graphic for each day of the month—one for Facebook and one for Twitter. Now there really is no excuse not to leverage the power of social media!

In addition to these resources, Life Happens has a complete suite of turnkey marketing resources that you can use to pull together your own LIAM campaign—or just to use on an ad hoc basis. These include short “true cost of life insurance” videos, brand new Real Life Stories videos and flyers, and eye-catching graphics that can be used in email newsletters or social media.

You can check them out at www.lifehappens.org/liam. Remember that to access these resources, you’ll have to sign into the Life Happens site (or create an account, if you haven’t already). Also, if you’d like to be able to personalize these flyers or embed the videos and more, check out the brand-new Life Happens Pro.

It isn’t often we get to throw around names of Hollywood stars; so, September is the time to take advantage of Anderson’s message and all that the LIAM campaign has to offer.

Bio:

Maggie Leyes oversees content strategy for Life Happens. She has been writing about the insurance and finance industry for more than 15 years.