Protection Products

Locking In and Protecting Gains


Protection

Whether it is due to the “recovering” economy, the increase in mergers and acquisitions activity, the substantial financial success of a number of different industry sectors (tech, agriculture, health care, etc.), or a combination of all these factors, we are seeing a considerable increase in the number of clients who have a new found abundance of liquid assets. This influx of capital often stems from the sale of a business, an inheritance, cashing in appreciated stock options, or other liquidity events, and clients are exploring the various alternative ways to put the funds to work.    

While there are countless different options, ranging from investment back into their private company to commercial real estate, hedge funds, stocks, commodities, etc., it may be useful to consider the wisdom behind a popular saying: “Pigs get fat, hogs get slaughtered.” Or, “You can’t score while you’re standing on the sidelines, but you also can’t get crushed by a 300-pound lineman.” 

Families in such a cash-rich position may want to consider permanent cash value life insurance, an often-overlooked financial instrument, for a portion of their funds. Advantages of allocating dollars to a life insurance policy include:    

  1. Gains for heirs – Life insurance death benefits lock in your gains and provide a competitive return – typically a tax-equivalent internal rate of return around 7-9% at life expectancy – without added market risk

  2. Deferred taxes – The tax-deferred growth of cash value and the tax-free nature of death benefits are some of the costliest expenditures for the federal government – which means they are the most advantageous for taxpayers

  3. Liquidity for estate taxes (which may end up being capital gains taxes) – Families often struggle to come up with the funds to pay taxes due upon death and are forced to sell off assets, often at a deep discount; death benefits can ease the burden

  4. Flexibility/access to cash – Properly designed, the policy may have cash value that is accessible for loans/withdrawals while the client is still living

  5. Creditor protection – In many states, life insurance is protected from creditors

  6. Potential to avoid probate/privacy – With properly named beneficiaries, your death benefit will pass on to heirs without the risk of a will contest, giving you privacy (everything that goes through probate is public information)

  7. Longevity diversification/hedging – Should you live well past your life expectancy, your investments will benefit from compounding returns; if you pass away prematurely, life insurance can make up for the abbreviated investment time frame

  8. Ease of ownership – Investments such as commercial real estate may provide attractive returns, but they require considerable time and effort on the part of the owner; life insurance is simple to own, requires very little of your time to manage, and does not require a level of expertise to liquidate upon your passing.  

 

Put It In Practice: For clients who find themselves with a substantial liquidity event, facing a decision as to how to allocate those dollars, a cash value life insurance policy may be an appropriate alternative to explore. Ash Brokerage can help you start the conversation. 

 

Cash-Value Life Insurance

Making Paycheck Protection Easier


Protection

You know your clients’ paychecks are important – for them and their families – and it’s only natural to think of disability insurance as their first line of protection. Don’t forget however, that life insurance can also protect paychecks, providing for your clients’ loved ones should they no longer be here to help.

Principal, one of our top carriers, understands the importance of paycheck protection and makes it easier to obtain coverage with their Accelerated and Simplified underwriting programs. 

Accelerated Underwriting allows qualified clients ages 18-60 to possibly avoid all lab testing and exams for a life insurance benefit of up to $1 million. (Applications will need to fit Super Preferred or Preferred risk class criteria.) With this program, a policy could be issued in as little as 7-10 business days! 

With Principal’s Simplified Disability Income program, clients ages 18-50 can get a monthly benefit of up to $4,000 a month after answering a few additional questions during their telephone interview, which will prescreen the client for Disability coverage. It’s a great way to get coverage faster and without additional hassle.  

Put it in Practice: Using Principal’s quick and easy programs for life and disability insurance underwriting, you can help your clients secure their ability to provide for their loved ones – no matter what happens. 

 

accelerated underwriting life insurance underwriting Principal

Travel is … Simplified!


Protection

With $927.9 billion in direct travel spending by domestic and international travelers in 2014; chances are your clients’ underwriting may include considerations of international traveling for business, pleasure or a combination of both. Studies show that by 2030, the number of travelers crossing international borders is expected to grow even more, exceeding 1.8 billion per year – increasing the likelihood travel will impact you and your clients.

Over the years, a growing number of states have adopted laws that on some level prohibit insurers from discriminating based on past or future lawful travel experiences. Beyond the well-known states of Florida, New York and California, there are more than a dozen other states, each adopting their own unique version of “no adverse travel action” laws. Additionally, the life insurance carriers all apply their own legal interpretation of each state’s adopted laws when evaluating travel risks.

Life insurance carriers have foreign travel guidelines which outline specific criteria a client must meet for consideration of coverage. The criteria generally includes:

  • Citizenship
  • State of sale
  • Desired amount
  • Plan of insurance
  • Future travel plans
  • Travel in the last 12 months
  • Destination (city/country)
  • Length of stay
  • Purpose of travel
  • Frequency of travel (if a repeated trip)

Along with these guidelines, select carriers have published lists of acceptable foreign travel locations, which commonly are categorized to indicate acceptable/no rating, acceptable/rating or limitation, and unacceptable travel.

While our industry has made significant strides in the area of international travel, any good partner will honestly share that it remains an area of case-by-case consideration. At Ash Brokerage, we leverage our experience, carrier relationships and resources to identify viable solutions based on your client’s individual circumstances and insurance needs. We look forward to assisting you on your next foreign travel case. With Ash Brokerage, travel is … simplified!

travel underwriting

Disability Does Not Play Favorites


Protection

What if you knew you were going to become totally disabled today? Are you ready? Are your clients ready? What about their finances – are they prepared, too? Most people and their financial plans aren’t protected from the unexpected. It’s unfortunate – you never know when a disability or illness will strike. 

Sometimes, it’s hard to imagine what could possible happen to make someone unable to get up and go to work anymore. It’s too difficult to think about being too sick or injured (physically or emotionally) to continue with live as we know it. 

But it happens. Trust me. I’ve heard many life stories that were both unexpected and unfortunate. 

One woman, a dentist, was cleaning her fish tank as usual when the unimaginable happened: The glass shattered and severely lacerated her wrist. Not only can she no longer practice dentistry and care for her patients, but she also can no longer provide for her family. She waited too long to decide to purchase a disability income policy.   

For one family man, the story ends on a brighter note. He was healthy. He went to the gym on a daily basis. He ate right. He saw his doctor regularly. Then, without warning, he suffered a stroke. He became wheelchair bound and unable to do the things he loved, including his work. Because he was prepared with a strong disability policy, however, his family was impacted emotionally, but not financially.  

Put it in Practice: Disability does not play favorites. It can happen to anyone. It comes in many forms. Ask your clients where they would be if they no longer had a paycheck. Then do something to help.  

 

paycheck protection

Firefighters: Paycheck Protection is Possible


Protection

Firefighters put their lives on the line every day; when they go to work, it’s no surprise they risk more than an average employee. Disability income insurance for firefighters is hard to come by, but Ash Brokerage works with carriers that will insurance this occupation. Due to the nature of the job and hazardous activities associated with fighting fires, however, the products available offer limited benefit amounts and restricted periods. 

Typically, the policy will cover only total disability, and the benefit period will be a maximum of two years. Some carriers may offer a limited partial disability benefit, which means the policy holder would be limited from doing some of his/her daily activities, but not totally disabled. In this case, the insured would receive a reduced benefit. 

It’s also important to note most firefighters are considered government employees. All disability carriers, no matter your occupation, consider government employees different from private business employees because government employees typically have part of their pension “pushed out” to them if they become disabled. Usually, there’s no way to stop this from happening, so carriers view this payment as a form of disability benefit. This limits the amount of coverage government employees can purchase, as compared to a privately employed person who doesn’t have any disability coverage. 

If you have any clients who are firefighters, the least you can do is look into the possibility of obtaining disability income insurance to protect their paycheck. After all, they protect your home, business and family every day. 

 

disability insurance DI paycheck