Tim Kukieza was recently featured on the DI Coach Podcast with Chris Carlson, a well-known disability income industry leader. Chris and Tim discussed all things DI, from how the industry is evolving to what they predict for the future. We’ve pulled out some of the key highlights for you below.
Opportunities for DI Advisors
Disability income is often overlooked, but it’s one of the most important elements of a solid plan. Look at your top 20 working clients, those in the buying age for DI. If you haven’t discussed it with them yet, that’s a great place to start. These clients are very important to your practice, and their income is important to them. It’s a great opportunity to make sure your clients are protected.
Second, consider tapping the RIA space. Many of these advisors don’t work with insurance, but their clients need protection too.
We are trying to simplify the DI conversation, so agents are not confused or apathetic when it comes to DI coverage.
DI’s Silver Lining
The pandemic changed a lot of things, and in many ways, it was devastating. There are, however, a few silver linings to look for.
First, as people have been worried about earning a living, more of them have been interested in protecting their income. And while the catalyst isn’t great, the result of more advisors and clients talking about the need for income protection is great.
Second, we’re seeing more carriers improving their products or coming back into the market. Underwriting, in some cases, is a simpler process than it’s ever been before.
And third, clients are willing to embrace technology with video calls and online processes like they’ve never done before. It’s actually easier to connect, despite all the distancing.
Premium fatigue can easily become an issue with even the best buyers. There’s a concern that DI will get lost in the shuffle as clients focus on life insurance and long-term care planning. Home owners, auto, life, LTC, umbrella…the list goes on. But it’s an income that makes all those over coverages possible. The paycheck needs to be protected too.
Changes We’d Like to See
As carriers pivot to keep business moving, the process is getting better. Currently, cycle time to get a DI policy issued is about 65 days. We’d love to see that shortened to 50.
We’d also love more advisors to embrace a consultative approach with saleable solutions. Our team has experience and expertise to help position DI as necessary, instead of optional. The product itself isn’t going to get much simpler, we need more advisors to get educated.
We’ve hit some of the major points they discussed, but we invite you to give the entire podcast a listen. There’s a lot in there.
And, reach out to Ash’s DI team with questions, client concerns and any other needs you might have. We’ll answer!
For financial advisors, long-term care can be one of those topics that produces a groan followed by a dismissal. Anyone anywhere near the industry has heard of carriers, products and pricing changes. And the pandemic has forced a change in the way we sell as well. There’s a lot to know about how to help your clients plan successfully.
During our recent virtual LTC U, we covered a lot about LTC. We took a high-level look at the need for planning, and then got down to some of the nitty gritty. Read on to discover some of the highlights of the series. And, if your interest is piqued, check out the replay on demand.
Why You Should Give LTC Planning Another Look
The need for a long-term care plan hasn’t diminished. In fact, if anything, it’s become something that more clients are asking for. It continues to be an emotional subject, and one that can seem overwhelming when clients really start looking into it. To help your clients plan starts with a conversation that is about embracing the emotional aspect, not about selling a policy.
Clients sometimes object that they can self-insure. And, in fact, clients that haven’t planned will end up self-insuring, although unintentionally. But what matters more is whether self-insurance offers the best value. By thinking through the costs of self-insurance versus transferring the risk to the policy, you help your clients develop an intentional plan and avoid eating up in long-term care costs the wealth they want to leave for their children. Long-term care is probably the single largest risk to an otherwise thorough retirement plan.
Long-Term Care Is Not a Place
It’s an event. But when your clients hear long-term care, the first they think is nursing home. With a little education, you can show them all of the options available should a long-term care need occur. And, with people living longer, there’s a greater chance of needing care. One way to bring up the topic is to ask where they’d like to receive care if they needed it.
Designing a Plan
Once you and your client have discussed what they want to have happen, and that they are interested in transferring some of that risk to a carrier, it’s time to design a plan. It’s important to remember that long-term care is not a capital issue, but a cash flow issue, and assets need to be allocated to it.
For most clients, long-term care is a once-in-a-lifetime purchase. They need time to make the decision. So, make yourself available, provide education and follow up, and allow them to move at their own pace.
In addition to your Ash LTC team, we have other resources to help:
And this is just the tip of the LTC U iceberg. If you’re ready to learn more, check out all three days of the replay. The most important takeaway is that you don’t have to be an expert when you have a team of experts behind you. Reach out to your LTC team, here to answer any questions. Just Ask.
In response to concerns surfacing on social media making allegations that life insurance carriers are refusing death claims involving vaccinated clients as a result of COVID vaccinations being deemed “experimental” due to Emergency Use Authorization Ash Brokerage has surveyed our carrier partners.
We connected with Chief Underwriters, Underwriting Officers and Managers representing over 15 of the industry’s leading insurance carriers. All carriers have advised their contracts (pre & post COVID) do not have exclusions regarding pandemics, COVID related deaths or deaths as a result of COVID vaccinations.
The extreme circumstance would be if such a client had a pre-existing condition that was blatantly misrepresented on their application, the contract is still in the contestable period in which case the claim would be fully evaluated and denial could be considered. Processing of these death claims remains unchanged, with the same high integrity business practices we all proudly represent.
Several carriers are determining if they will produce press releases, others are finalizing them, a few referred me to the attached statement from ACLI (https://www.acli.com/Posting/NR21-012) which establishes allegations as unfounded and incorrect.
After much research, dialog and discussion please be rest assured, vaccinations against coronavirus will not impact the well-established and customary claims practices for life insurance policies. Please contact us should you have any additional questions, the peace of mind for all we serve is of great importance to Ash and our carrier partners.
Most of us are beyond ready to get back to the normal we knew a year ago. And for financial advisors, that means helping your clients prepare for the possibility of taxes returning to higher rates. As clients have questions about taxes, you have an opportunity to protect them with tax-efficient solutions.
There’s also a good chance that these same clients need life insurance. Which just happens to be a great resource for providing that tax efficiency we just mentioned.
To get started, think of your high-income clients. The easy solution for providing insurance is to look at a term policy. It’s relatively inexpensive and the application process keeps getting simpler. But that only gets you halfway there — it doesn’t solve the problem of tax efficiency.
Instead, consider a cash value life insurance policy that provides the needed insurance protection, AND allows them to accumulate money for retirement on a tax-advantaged basis. Let’s go into a little more detail about why this strategy makes sense.
Currently, high-income professionals are paying record low taxes. Consider a family of two working professionals, each making $150,000 per year, for $300,000 Adjusted Gross Income. In this example, the family falls into the 24% marginal tax bracket, which, adjusted for inflation, is the lowest it’s been in the past 70 years (see the chart below). To put it in perspective, in 1981 their marginal tax bracket would have been 64%.
Cash value life insurance can be used to hedge against a “return to normal” in terms of taxes for clients in this demographic. And under our new administration, there’s definitely a chance that taxes will increase in the near future.
Find out more about how cash value life insurance can help your high-income clients create a tax-diversified financial plan. We’re here to walk you through the basics and design the plan that’s right for each individual situation.
There can be no doubt that 2020 has provided an abundance of new challenges paired up with an unprecedented amount of change within our industry. An entire workforce has needed to adapt to a remote and virtual environment. At the same time, carriers and vendors have sought out creative ways to continue to keep moving business moving forward at a pre-pandemic pace.
Enhanced digital submission and delivery options, electronic health records, and simplified underwriting programs have all been beneficial in navigating this unfamiliar routine.
For the most part over the past six months, our carrier partners have been able to function normally – with minimal effect on service turn-around times. However, even with digital advancements, challenges ranging from regional storms to vendor closures are affecting some carriers’ ability to process business.
The most tangible delays had been limited to Principal, due to a massive influx of business submitted through their industry-leading Accelerated Underwriting program. Unfortunately, we’re beginning to see some delays at more than just a few isolated carriers. Turnaround times are beginning to be affected.
Managing expectations is central to driving a positive client experience. Policies are still being approved and issued. Lives continue to be impacted. We simply need to note that there are currently delays in the process.
Problem-solving is one of Ash Brokerage’s core values. We continue to look for ways to bring solutions to you and your clients. Should an obstacle arise, we see it as an opportunity. And while this year is uncommon in every sense, we’ve been rising to the challenge for nearly 50 years. We have the tools and, more importantly, the people, to get the job done right. We’ll help you navigate this landscape with transparency and alternate recommendations as needed.
Whatever the question, whatever the need. Ash Answers.
© 2018 Ash Brokerage LLC.