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Thursday, May 25, 2017

Bridging the Gap from Annuities to Life Insurance

By: Charlie Gipple CLU, ChFC, SVP Sales and Marketing at Partners Advantage Insurance Services, LLC

Today, there are about 325 million people that live in the United States. However, only around 4.8 million of those people have a long-term care policy, and long-term care can be expensive! In 2015, the median cost of a private room in a nursing home was around $90,000 per year and the median assisted living facility was around $42,000 per year. Considering there is a 70% chance that if you are over the age of 65 you will experience a long-term care event, these statistics are worrisome. Especially considering the persisting hesitancy for consumers to purchase long-term care insurance because of the high cost, premium increases, and the big one; if the consumer doesn’t use the benefit, they lose it!

The good news is Single Premium Life Insurance can help in this area as well. Many products have long-term care, chronic illness and/or terminal illness benefits that come along with the product, whether in the form of a rider or an imbedded benefit. 

Many times what these riders will allow is an “acceleration” of X percent of the death benefit if the consumer has a condition that qualifies. Taking one very popular SPL product in the marketplace as an example; this product has a terminal illness rider that will pay out 95% of the death benefit if the insured is diagnosed with a terminal illness. Furthermore, 100% of the death benefit (minus a $250 charge) can be paid to the insured over a period of time if the client is either confined to a nursing home or diagnosed with a chronic illness. If the client wants the nursing care confinement benefit or chronic illness benefit in a lump sum, there are “discount factors” that would be applied to the death benefit, for example 85% and 75% respectively for the nursing care confinement and chronic illness benefits. 

Furthermore, the underwriting for these extra “morbidity” benefits many times amounts to nothing as the insurance company may only underwrite for mortality (Death) and not morbidity (Illness). So, for a consumer that has been denied traditional long-term care insurance, these benefits attached to an SPL policy may be a good alternative. 

The time has never been better for the “Live, Die, or Quit” value proposition of Single Premium Life. To clarify, if the consumer lives long enough to have a chronic illness, there is great value in SPL. Conversely, if the consumer dies, the death benefit will pay out to a beneficiary. Or lastly, if the consumer realizes they want to “quit” their policy, they can do that at any time and get at least their original premium back.

Learn more in the full white paper "SPL: Bridging the Gap from Annuities to Life Insurance," by Charlie Gipple, CLU, ChFC. It provides case examples, addresses costs, and how you can find success in explaining these products to clients.  

Questions or Need Case Assistance: Contact the Partners Advantage Brokerage Team at 888-251-5525, Ext. 700.


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For financial professional use only. Not for use with consumers.

This material is intended for educational purposes only and is not intended to serve as the basis for any investment or purchasing decision. Insurance and annuity products: Are not deposits. Are not guaranteed by a bank or its affiliates. May decrease in value. Are not insured by the FDIC or any other federal government agency. This information is written in connection with the promotion or marketing of the matters addressed in this material. The information cannot be used or relied upon for the purpose of avoiding IRS penalties. These materials are not intended to provide tax, accounting or legal advice. As with all matters of a tax or legal nature, your clients should consult their own tax or legal counsel for advice. Pursuant to IRS Circular 230, Partners Advantage Insurance Services and their representatives do not give tax or legal advice and cannot be used to avoid tax penalties or to promote, market, or recommend any tax plan or arrangement. Encourage your clients to consult their tax advisor or attorney. The information contained in this article is not intended to serve as tax or legal advice and is not intended to provide financial or legal advice and does not address individual circumstances. Encourage your clients to consult their tax advisor or attorney. The information contained in this article is not intended to serve as tax or legal advice and is not intended to provide financial or legal advice and does not address individual circumstances. Both loans and withdrawals from a permanent life insurance policy may be subject to penalties and fees and, along with any accrued loan interest, will reduce the policy’s account value and death benefit. Assuming a policy is not a modified endowment contract (MEC), withdrawals are taxed only to the extent that they exceed the policy owner’s cost basis in the policy and usually loans are free from current federal taxation. A policy loan could result in tax consequences if the policy lapses or is surrendered while a loan is outstanding. Distributions from MECs are subject to federal income tax to the extent of the gain in the policy and taxable distributions are subject to a 10% additional tax prior to age 59½, with certain exceptions. These characters are fictional and are not actual customers. Your own decisions should be made in light of your own financial situations. This hypothetical examples used are for illustrative purposes only, is no guarantee of return or future performance, and does not depict the actual performance of a specific product or its investment options. In order to provide a recommendation to a client about the liquidation of a securities product, including those within an IRA, 401(k) or other retirement plan, to purchase a fixed or variable annuity or for other similar purposes, you must hold the proper securities registration and be currently affiliated with a broker/dealer or registered investment adviser. If you are unsure whether or not the information you are providing to a client represents general guidance or a specific to liquidate a security, please contact the individual state securities department in the states in which you conduct business. Indexed Universal Life is not a stock market investment and does not directly participate in any stock or equity investments. Market Indices do not include dividends paid on the underlying stocks, and therefore do not reflect the total return of the underlying stocks; a market-indexed insurance product is not comparable to a direct investment in the equity markets. Clients who purchase IUL are not directly investing in a stock market index.

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Thursday, May 18, 2017

Developing a Referral Mindset

By: Michael Macias, Relationship Coordinator at Partners Advantage Insurance Services, LLC

First, ask yourself this question: Doesn’t it make sense to make a decision to build a business based on how people want to meet us? Here are five steps that could potentially help put you in front of more clients and grow your business by fully engaging a referral mindset. This will benefit your current clients, future prospects, and even the network of other financial professionals you work with on a regular basis.

Step 1: Make a Decision and Throw Out the HeadTrash1
Before developing your referral strategy, you need to make a decision; the decision that you want to be in front of more clients and you are willing to put forth the effort that can potentially create the success you want to achieve.

Step 2: Develop and Work a Process
Developing a process needs to be customized in a way that works for you and your unique business model, but inflexible enough so that you will stick to it.

Step 3: Develop “Referral” Networks
Have you ever thought of giving referrals yourself? What if giving those referrals equated to you receiving referrals in return?

Step 4: Harness the Power of Expectation
Rather than be hopeful of getting referrals, be expectant. Would you agree going into any situation expecting a certain outcome would increase the chances of that outcome actually happening?

Step 5: Rinse, Repeat, and Monitor Results
The final step in the process is bringing it all together. Monitor your process over time for results based off of the action items you have taken. Are you getting the results you are “expecting”?

Putting forth effort into this process can help create a profitable referral strategy. When combined with your overall business model and prospecting strategy, you can create a solid foundation where your referral network and business can continue to grow.


Contact Michael Macias, Relationship Coordinator for additional creative ways to ask for referrals: 888-251-5525, Ext. 389. 

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1headtrash911.com

FOR FINANCIAL PROFESSIONAL USE ONLY. NOT FOR USE WITH THE PUBLIC.


This material is intended to provide general information only. It is not intended to render legal, accounting, Social Security or tax advice, and the services of those professionals should be sought. Financial professionals who utilize this material may be able to identify potential retirement income gaps and introduce products, such as fixed annuities, as potential solutions. The testimonial may not be representative of the experience of other financial professionals and is no guarantee of future success.


Always follow your firm’s policies and procedures regarding review and use of third-party templates, creation and distribution of client and prospect materials, hosting of client and prospect events, offering giveaways or prizes, and your firm’s employment process.


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Monday, May 15, 2017

Help Your Clients Be Prepared For Life Changes With A Policy Review

Do you have clients who are getting married? Buying a house? Having grandchildren? Recently widowed? Acquiring assets?

An essential component of the life insurance sales process is periodically reviewing the coverage to make sure it is addressing your clients' current needs. Many people assume their protection is sufficient and appropriate for the duration of their lives. However, life changes, and a client's life insurance plan should adapt as well.

Have your clients' needs changed?

With a client review, you can help your clients make use of their premium payments and accumulated cash values. Position yourself as a reliable financial professional. Call Partners Advantage today and we'll provide you with three marketing pieces: life events checklist, life insurance client review, and a case study. These three items can help you explore the client review process and put it to work to help you further grow your sales. 

Start now and help your clients meet their financial protection goals today and into the future. Call us at 888-251-5525, Ext. 389 or email Michael Macias at 
mmacias@partnersadvantage.com.

We are available to you by phone 12 hours each business day - 7 a.m. to 7 p.m. Central. 

For financial professional use only. Not for use with consumers.

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Thursday, May 11, 2017

The Mind-Game of Seminars

By: Charlie Gipple CLU, ChFC, SVP Sales and Marketing at Partners Advantage Insurance Services, LLC

Conducting presentations is one big mind-game. I believe it is the mind-games that presenting plays on us that makes presenting the number one fear in America in study after study. Just google “America’s #1 fear” to see my point. I therefore believe that the mindset of the presenter is what will determine the success or failure of a seminar presentation. 

So, allow me to address different areas of “mindset” that are of huge importance.

Preparation: Practice How You Play
To me, preparation is rehearsing.  A lot of people have this backwards—they spend more time on the PowerPoint slides than the rehearsing. Rehearsing out loud is crucial. I stress out loud because even though the words and the flow may sound smooth while rehearsing silently, it can be a night and day difference when the words are actually coming out of your mouth. Your brain works at a much different pace than your vocal cords and your tongue. By rehearsing (out loud) to the point where you have done one full presentation to yourself that flowed well, had the right pauses, right energy, right content, etc., you will knock it out of the park.  

Embrace the Butterflies
Many people view being nervous before presentations as a bad thing. I believe that being nervous can have a positive impact on a presentation. As a matter of fact, the positive effect of being nervous is a chemical and biological fact, not something I am speaking about theoretically. Our maker has given us something called adrenaline, which is a blessing!

As you are walking up on stage the number one thing you should have in your mind is almost a verbatim “script” of the first couple of sentences of your talk. Once you have successfully articulated those first couple of sentences, your nervousness will have gone down significantly and your preparation/training will then kick in. Furthermore, after the first couple of sentences, that very important first impression mentioned earlier would have already been formed in the minds of the audience. The opening determines everything! Embrace the butterflies!

Confidence
I believe the core mindset variable that determines your success or failure in this mind-game of presenting is confidence. If you come across as confident to the audience (even if you aren’t confident), your audience will feel this confidence and reflect positive body language back to you which in turn creates confidence in your own mind. Now, if for whatever reason you do not feel confident, the term “fake it till you make it” has some truth here because of that self-fulfilling prophecy.


Want to learn more? Call the Partners Advantage Brokerage Team at 
888-251-5525, Ext. 700.


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This material is intended for educational purposes only.  For financial professional use only. Not to be used for consumer solicitation purposes.

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Tuesday, May 9, 2017

Meeting the Life Insurance Needs of Affluent Foreign Nationals

By: Bill Jackson J.D., CLU®, Sr. Advanced Markets Consultant at 
Partners Advantage Insurance Services, LLC

With increasing globalization, more and more affluent foreign nationals have a presence in the United States. It is estimated that affluent foreign nationals control more than $70 trillion in assets and number over 14 million individuals*. Furthermore, these affluent families are culturally receptive to the protection offered by life insurance.

Why do many savvy foreign nationals look to the United States to buy life insurance? There are the usual reasons, perhaps to protect a business interest. Two reasons stand out above the rest. Foreign nationals, who own property in the United States, have unusual exposure to Federal Estate Tax. Also, foreign nationals crave the guarantees and stability of U.S. dollar based life insurance policies offered by U.S. carriers.

Resident and Non-resident aliens are treated differently for estate transfer tax purposes. Resident aliens are taxed just like U.S. citizens, and have the $5.4 million unified gift and estate tax exemption as well as the annual $14,000 gift tax exemption. The hurdle they face is that all foreign assets are included. They also do not have access to the unlimited marital deduction. Non-resident aliens don’t include foreign assets, but U.S. assets are subject to the 40% federal estate tax rate and they only have a $60,000 exemption. They can however, exclude annual gifts up to $14,000. In other words, a foreign national with a million dollar California residence would be liable for $376,000 of federal estate tax on that property alone on the death of the first spouse. Life insurance is the go-to option to avoid liquidation, and a secondary benefit is that life insurance is not considered U.S. situs property subject to estate tax. 

Even foreign nationals who hail from Class A or B countries often face volatile currency fluctuations. So, when they are looking to protect their family, they naturally gravitate towards carriers offering products backed by a stable currency. Therefore U.S. currency products and carriers are in demand. 

Because non-resident aliens can hold life insurance policies personally, without the policy being subject to U.S. income or estate tax, the goals of wealth preservation and providing retirement income can easily be accommodated. No life insurance trust would be required.
Which foreign nationals could benefit from U.S. based policies? Most carriers require some U.S. connection. These connections could take the form of a minimum stay of say 15 days per year, real estate ownership, a business interest or immediate family living in the U.S. Some carriers may also require that a percentage of the assets used to justify the coverage be held in the U.S.

Most all carriers will require that solicitation and applications be taken in the U.S., as well as medical exams are usually expected to be completed in the U.S.

At Partners Advantage Insurance Services, we have the experience and resources to help you be successful in this lucrative market segment. Not only do we provide access to the major U.S. carriers who cater to the foreign national market, we also have relationships that can provide international coverage to foreign nationals who do not have a connection with the U.S.

Call Bill Jackson J.D. CLU, Senior Advanced Markets Consultant if you have a case you would like to discuss or would like added information on: 888-251-5525, ext. 361.

For financial professional use only. Not for use with consumers.

*Source: World Wealth Report, 2015, Capgemini and RBC Wealth Management
Capgemini, RBC Wealth Management, and Scorpio Partnership Global HNW Insights Survey 2013.

This material is intended to provide general information only. It is not intended to render legal, accounting, Social Security or tax advice, and the services of those professionals should be sought. Financial professionals who utilize this material may be able to identify potential retirement income gaps and introduce products, such as fixed annuities, as potential solutions. The testimonial may not be representative of the experience of other financial professionals and is no guarantee of future success.

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Thursday, May 4, 2017

Tips on Communicating Effectively with Women Clientele

By: Vanessa González, Internal Wholesaler, Partners Advantage Insurance Services

Have you ever wondered what percentage of your clients feel underserved, or if they have considered finding a new financial professional? Did you know that there are millions of household decision-makers in the United States needing financial guidance and solutions, but don’t know who they can turn to? 

Today, more and more women are a large part of a rising generation with high income potential that are beginning to save for retirement, looking for life insurance, and long-term care planning. As a financial professional, what are you doing to help? The women’s market has a lot of untapped potential and is a great opportunity for you.

Why isn’t there a better connection between women and their financial professional? The answer is SIMPLICITY. Yes, just keep it simple. If you can provide your women clients with the personal attention and coaching they need to achieve their goals, not only will you gain their trust, but you’ll benefit from their loyalty. Additionally, a happy client would most likely become a source of referrals.

Contact Vanessa Gonzalez for support in increasing your presence in the women's markets at 888-251-5525, Ext. 145.


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For financial professional use only. Not for use with consumers.

The information in this article is for general information only.

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Thursday, April 27, 2017

Stars are Aligned for Fixed Indexed Annuities and Guaranteed Lifetime Withdrawal Benefits

By: Charlie Gipple, CLU, ChFC, SVP Sales and Marketing at Partners Advantage Insurance Services, LLC

With FIAs, IT’S NOT ABOUT THE AMOUNT OF RETURN ON YOUR MONEY, IT’S ABOUT THE AMOUNT OF MONEY YOU’RE GETTING THE RETURN ON.  

The year was 1994, and there was a CFP from California that would create one of the most profound “rules of thumb” for retirement income that has ever been created.  William Bengen wrote an article which appeared in the Journal of Financial Planning, and it released the results of this very profound study that he had just undertaken.  This study is what started the “Gold Standard” safe withdrawal rate of 4%.  William basically said that even though over time the market had averaged around 10%, in the distribution years, it doesn’t mean that a client can “safely” withdraw 10% from their portfolios.  So, what William did is he back-tested hypothetical retirement “start dates,” assuming a 50% stock and 50% bond portfolio all the way back to the 1920s, using the actual stock and bond market performance. 

After the analysis was said and done, he said that consumers were “safe” by withdrawing 4% of their initial portfolio value per year adjusted for inflation or deflation.  By “safe,” what he meant was that the 4% distributions were very unlikely to spend down the client’s portfolio/retirement money before the end of the 30-year retirement.  As a matter of fact, in his study, he had a 100% success rate using the 4% rule for retirement income. 
As a result of this study, securities reps for almost two decades have been living and dying by this rule. If a client has a million dollars at retirement, then the client should not take more than $40,000 during the first retirement year, for example. A later study was done in 2013 that was coauthored by Morningstar Inc. It established, in this new world of volatile markets and low interest rates, that the new “safe withdrawal rate” is actually 2.8%. 

The study also indicated that with today’s low-interest rates, market volatility, and SEQUENCE OF RETURNS RISK that there is almost a 52% chance of failure using the 4% rule. Would you get on an airplane if there was a 48% chance of having the number of landings equal the number of takeoffs?

Before looking at what a GLWB can do for a client on a “guaranteed* basis,” I want to point something out. When you look at this risk that we just discussed, which is the client losing 20% of their portfolio value and then taking a major pay cut in retirement or having to delay retirement, this risk is just as catastrophic as say a car crash, medical emergency, a house fire, etc. Or, maybe even death itself. What is the point? My point is, when risks in our lives are catastrophic, should they occur, we take actions to hedge those risks. What do we use? We use something called insurance!

Learn more about FIAs and GLWBs in the full white paper "Stars are Aligned for Fixed Indexed Annuities and Guaranteed Lifetime Withdrawal Benefits" by Charlie Gipple, CLU, ChFC. Gain insights on how to help your clients with FIAs and GLWBs and walk them through hypothetical scenarios that show them how FIAs can be great inflation fighting products.

Call your Partners Advantage Brokerage Team at 888-251-5525, ext. 700 for a copy.

For financial professional use only. Not for use with consumers4

*Guarantees are backed by the Financial Strength and claims-paying ability of issuing company.

Annuities are designed to meet long-term needs for retirement income. They provide guarantees against the loss of premium and credited interest, and the reassurance of a death benefit for beneficiaries.

An income rider or benefit (sometimes called Guaranteed Lifetime Withdrawal benefit rider or GLWB rider) is an additional feature available with some annuities and generally optional and come with additional costs. Income benefits are designed to provide income options above and beyond the standard annuitization or free withdrawal features in annuities.

Pursuant to IRS Circular 230, Partners Advantage Insurance Services and their 
representatives do not give tax or legal advice and cannot be used to avoid tax penalties or to promote, market, or recommend any tax plan or arrangement. Encourage your clients to consult their tax advisor or attorney.

The information contained in this article is not intended to serve as tax or legal advice and is not intended to provide financial or legal advice and does not address individual circumstances.

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