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Tuesday, May 1, 2018

Non-Medical vs Underwritten Life Insurance Policies

Peter Pan’s most famous line was “I never want to grow up!” Today, in the life insurance application process I hear, “I do not want to take a medical exam…” While not every type of life insurance plan requires a medical exam, there will be times that it’s necessary when applying for coverage. Is one type better than the other? No. It really just depends on the needs of your prospects/clients, and if they are eligible for a non-medical option.

Life Insurance without the Medical Exam
Do you have clients who need to get a policy issued due to a loan? Divorce? Afraid of needles? They need it yesterday? The non-medical option may be an option for qualified clients.

The non-medical opportunity is available for ages 18 to 69; Class approval ratings can be Sub-Standard to Preferred Plus; Products available are from Term to Permanent; Face amounts are up to $1 million dollars, and approvals can happen within 24-48 hours, on most occasions. Were you aware of all of these options for your clients?

Fully Underwritten Life Insurance
Fully underwritten life insurance usually costs less than non-med insurance, and the medical exam does involve a questionnaire about your lifestyle, blood, urine sample, weight and height check, in addition to family medical history, hospitalizations and medications you take. Normally the insurance carrier pays for the medical exam, but if results come back different than what your clients believe, and they want to contest those results, those additional tests will run at the client’s own expense. With the medical exam, there is a chance that your client may fail and coverage is denied.

Using eApps to Help Speed up the Process
Insurance companies have done an incredible amount of research to get this to a science. The tools for them are there. We can show you the FIVE MINUTE life application that most companies offer. After the case is entered by you on the Partners Advantage website (the client does not have to be present), it gets sent directly to the carrier. Your client then goes through a phone interview, and answers all the same health questions that are on an application. Partners Advantage can help you prepare your client for this call. The carriers will then check Medical Information Bureau (for insurance history and medical codes assigned), run a prescription drug check, a motor vehicle check, and LexisNexis® for additional risk details; All of these areas are checked within 24-48 hours. A carrier either approves the case, or has the client go through additional underwriting (i.e. exam, medical records) based on the information that is uncovered.

Next Steps for You to Take
Partners Advantage can guide you through the process and let you know which carrier, and if non-med or a fully underwritten life policy is the best fit for your prospect/clients’ situation. Give us the opportunity to review a case for you. We have a very talented Underwriting Department that offers questionnaires and other avenues to offer underwriting risk services. So are you and your client up for the challenge? The five minute application process, and the approval may occur within 24-48 hours so call today at 888-251-5525, Ext. 700 to speak to a member of the Partners Advantage Sales Team.

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

This blog is designed to provide general information about the subject matter covered. Partners Advantage Insurance Services and their representatives do not give tax or legal advice. The material in this blog is provided for informational purposes only and should not be construed as tax or legal advice. Guarantees and benefits are based on the claims-paying ability of the issuing insurance company. Keep in mind that most life insurance policies require health underwriting and, in some cases, financial underwriting. Each case is individually underwritten as the severity of medical conditions varies among individuals. Formal underwriting evaluation and pricing is based on the individual characteristics of each case.

Partners Advantage Insurance Services and their representatives do not give tax or legal advice. The material in this article is provided for informational purposes only and should not be construed as tax or legal advice. Guarantees and benefits are based on the claims-paying ability of the issuing insurance company. Keep in mind that most life insurance policies require health underwriting and, in some cases, financial underwriting.

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Tuesday, April 24, 2018

Five Life Insurance Myths

Courtesy of: Protective Life

Life insurance can be a complex subject, and just about everyone has an opinion about who does and doesn't need it, how much to buy, and what types of policies are best.

For this reason, we're listing the top five myths about life insurance and an explanation for why that myth might not be true. We hope this information will provide insights that can help you, help your prospects/clients decide what's right for them.

Myth 1: Life insurance through work is really all you need.
Having life insurance through work is good, but many employer-sponsored plans offer small term or accidental death policies with low limits. Moreover, these policies are not typically portable, so if your prospects/clients leave their company or get laid off they'll be left without coverage and will need to apply for a new policy based on their current age and health status.

It's important to know their policy limits because what they have through work may not be enough. Securing life insurance independent of what they have at work that can lock them into a lower rate and you won't have to worry about losing coverage if you they are changing jobs.

Myth 2: If you're single or young you don't need life insurance.
Even if your prospects/clients have no dependents, they'll still have funeral expenses that their family will need to pay when they die. They might also get married and start a family at a later date and will need to provide financial support for their spouse and dependent children.

Buying life insurance while they're young can lock them into lower rates.

Myth 3: Only the breadwinner of the family needs life insurance.
A stay-at-home spouse may not earn an income, but think of all he or she does to keep the household running: child care, meal preparation, transportation, housekeeping, and more. With that spouse gone, life suddenly gets a lot more challenging - and expensive.

The cost of replacing the services provided by a stay-at-home spouse can be higher than they think. Life insurance can help defray the cost of hiring help to accommodate a new lifestyle in their partner's absence.

Myth 4: You don't need to review your coverage.
Life insurance isn't a set-it-and-forget-it proposition. Every significant life event - marriage, a new baby, divorce, buying a house, retirement planning- should prompt your prospects/clients to double-check their coverage.

Even if they've had no big changes, it's smart to review their policy every few years to ensure that they're keeping pace with inflation and still getting the best value for their premium dollars.

Myth 5: You're better off investing your money rather than buying life insurance.
Your prospects/clients are taking a big chance when they depend solely on their investments to take care of their family. If they die without coverage, there may be no means to provide for them after their assets are depleted.

Don't bank on their assets being enough. Establishing a life insurance policy outside their investments ensure that their family has enough readily available cash when they die.

These are just a few of the misunderstandings about life insurance. Help your clients know the facts and don't let the myths stop them from choosing the right coverage. To get more helpful information about types of life insurance and how they can meet your clients needs, contact Partners Advantage at 888-251-5525, Ext. 700.

You can view the original article post on Protective Life's Learning Center website: https://www.protective.com/learning-center/life-insurance/five-life-insurance-myths/

This material is intended for educational purposes only. You should not treat any opinion expressed as a specific inducement to make a particular investment or follow a particular strategy, but only as an expression of opinion and experiences. Partners Advantage does not warrant or guarantee the accuracy or completeness of the information contained herein.
A Life insurance is a complex subject that is easily misunderstood. Many times people look to friends or relatives for advice about life insurance and with that increases the chance for myths to be taken as fact. This article highlights a few common myths that are commonly accepted as fact. Don't let misinformation keep you from gaining the understanding you need to make informed decisions about your life insurance coverage needs. For more information, visit our learning center.

All Learning Center articles are general summaries that can be used when considering your financial future at various life stages. The information presented is for educational purposes and is meant to supplement other information specific to your situation. It is not intended as investment advice and does not necessarily represent the opinion of Protective Life or its subsidiaries.

Learning Center articles may describe services and financial products not offered by Protective Life or its subsidiaries. Descriptions of financial products contained in Learning Center articles are not intended to represent those offered by Protective Life or its subsidiaries.

Neither Protective Life nor its representatives offer legal or tax advice. We encourage you to consult with your financial adviser and legal or tax adviser regarding your individual situations before making investment, social security, retirement planning, and tax-related decisions. For information about Protective Life and its products and services, visit www.protective.com.

Companies and organizations linked from Learning Center articles have no affiliation with Protective Life or its subsidiaries.


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Tuesday, April 17, 2018

Why Is Life Insurance Important?

Courtesy of: Protective Life

The value of life insurance cannot be overstated. Life insurance offers protection for your prospects/clients family and home in the event of their death. Help prevent financial hardship for your clients' loved ones with life insurance.

Some people may think of life insurance as just another expense. The question your prospects/clients need to consider is would someone in their life suffer an economic hardship if they were to die? If the answer is yes, then life insurance is important for them to have.

Married with children
If your prospects/clients are married and have young children at home who depend on their income, they have a clear need for life insurance. If they were to die, the loss of your client's income could cause an immediate financial hardship. Not only would this make it harder for their family to make ends meet, but for them to realize future goals such as a college education. Even if one spouse is a stay at home parent and doesn't bring in a formal paycheck, his or her death means that the surviving spouse will have additional expenses such as child care, cooking, and housekeeping - all necessary services for running a household.

Married without children or singles
Why is life insurance important if your clients' don't have children or a spouse? Just because they don't have children or are married, doesn't necessarily mean that they don't need life insurance. If their spouse or significant other depends on your client's income to keep the bills paid and to run the household together as a joint venture, then having the financial safety net of a life insurance policy is vital. And whether they're married or living the single life, who is going to pay the costs associated with their final expenses? Things such as funeral costs and jointly held debt (such as a cosigner on a loan) are just a few of the costs that they'll need to consider in the event your clients were to unexpectedly die. Unless they already have sufficient financial resources to cover these expenses, their survivors will most likely need life insurance to help pay for it all.

Having enough life insurance is just as important
The loss of a loved one is an emotional and traumatic experience for any family. But not having enough money to meet immediate and ongoing living expenses, can make a very difficult situation even worse. Not only are the people your clients loved grieving their loss, but they'll now have added financial stresses to cope with. Depending on their current financial resources and ability to get back on their feet both emotionally and financially, their loved ones could be forced to move to a less expensive home or community, forego education and career plans, and cut back on their quality of life. They may be even forced to take out loans to pay for your funeral and burial costs, as well as any outstanding medical or tax bills.

If your clients are still wondering why life insurance is important, stop them to consider the potentially devastating consequences of not having coverage to financially protect the people that they love.

Learn more about the life insurance resources available to you and your clients. If you have potential clients, Partners Advantage can guide you thru the life insurance process and can let you know which carrier would best meet for your clients' needs. Call us at 888-251-5525, Ext. 700.

You can view the original article post on Protective Life's Learning Center website:  https://www.protective.com/learning-center/life-101/why-get-life-insurance/why-is-life-insurance-important/

This material is intended for educational purposes only. You should not treat any opinion expressed as a specific inducement to make a particular investment or follow a particular strategy, but only as an expression of opinion and experiences. Partners Advantage does not warrant or guarantee the accuracy or completeness of the information contained herein. 

All Learning Center articles are general summaries that can be used when considering your financial future at various life stages. The information presented is for educational purposes and is meant to supplement other information specific to your situation. It is not intended as investment advice and does not necessarily represent the opinion of Protective Life or its subsidiaries.

Learning Center articles may describe services and financial products not offered by Protective Life or its subsidiaries. Descriptions of financial products contained in Learning Center articles are not intended to represent those offered by Protective Life or its subsidiaries.

Neither Protective Life nor its representatives offer legal or tax advice. We encourage you to consult with your financial adviser and legal or tax adviser regarding your individual situations before making investment, social security, retirement planning, and tax-related decisions. For information about Protective Life and its products and services, visit www.protective.com.

Companies and organizations linked from Learning Center articles have no affiliation with Protective Life or its subsidiaries.


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Tuesday, March 20, 2018

Tax Cuts and Jobs Act (TCJA) Strategies

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

Tax Cut and Jobs Act (TCJA); short for “An act to provide for reconciliation pursuant to titles II and V of the concurrent resolution on the budget for fiscal year 2018.” What a mouthful! I think we will stick with TCJA. One of the major areas of complexity in this new law, which is effective for 2018, is its application to pass through entities. 

As you may be aware, the top corporate tax rate has been reduced from 35% to 21%. However, with sole proprietors, partnerships, “S” corporations, and pass through LLC’s there is a 20% deduction on adjusted gross income.

The complexity arises in how and when the 20% deduction is applied. If the client has an “S” Corporation, only the distributive share is eligible for the 20% deduction. W-2 wages paid to principals are not eligible nor are guaranteed payments to the shareholders. 

To add to the complexity of this act, congress chose to limit the benefits of the 20% deduction for “service” organizations. If the business derives its income from personal service, the deduction is phased out at certain levels of adjusted gross income; so doctors, accountants, attorneys, financial professionals, real estate agents, and consultants must deal with the phase-out of the 20% deduction.   

For service organizations where the taxpayer is filing singly, the deduction is available up to $157,500 of adjusted gross income. There is a pro rata reduction up to $207,000 of Adjusted Gross Income (AGI) and over that amount the deduction is completely gone. If the taxpayer is married filing jointly, the threshold is $315,000 and the deduction is gone at $415,000 of AGI. If filing jointly, the spouse’s income is also included in determining the phase-out. 

Obviously affluent service business owners need help. Keeping income below the $315,000 threshold could provide a $63,000 deduction and save $17,640 in taxes for a pass through service business owner with and AGI of $315,000.

How can a service business owner reduce taxable income below the threshold? Most have fewer than five employees or may work alone. The ability to reduce income by buying a substantial depreciable asset is often limited. The only alternatives for reducing income are a qualified retirement plan or deductible interest payments on a loan based split dollar plan.

In the qualified retirement plan space, two options stand out. The most flexible option for a business that may have fluctuating profits is the SOLO K plan, which can allow deductions of up to $61,000 for owners over age 50. For businesses with stable profits, the defined benefit plan is a top choice. Deductions for this type of plan can easily exceed $170,000 each year for an owner participant. Several carriers like Lafayette Life, National Life Group, and American National offer plan design, plan administration, and funding media specifically designed for these plans. Options include annuities and life insurance.

With the loan based split dollar or dual loan strategy, the business takes a commercial loan and loans the proceeds to the owner to pay premiums on a personal life insurance policy. The policy is collateral for the loan and the owner pays interest at the applicable federal rate. The owner receives a higher level of protection for family and higher retirement income potential than with a traditionally funded plans. The business interest deduction often amounts to between $30,000 and $60,000.

These strategies can mean the difference between being able to benefit from the 20% deduction and not seeing any tax relief. To learn more about how these strategies work, and how they can benefit your clients, contact the Partners Advantage Advanced Markets Department at 888-251-5525, Ext. 361.

Did you miss the webinar titled, “Opportunities Generated by the Tax Cut and Jobs Act (TCJA)?” You can access the replay here >> Get Webinar On-Demand.

For financial professional use only. Not for public distribution.

Not to be used for consumer solicitation purposes. You should not treat any opinion expressed as a specific inducement to make a particular investment or follow a particular strategy, but only as an expression of opinion and experiences. Partners Advantage does not warrant or guarantee the accuracy or completeness of the information contained herein.  

Partners Advantage Insurance Services and their representatives do not give tax or legal advice. Accordingly, any tax information provided is not intended or written to be used, and cannot be used, by any taxpayer for the purpose of avoiding penalties that may be imposed on the taxpayer. Encourage your clients to consult their tax advisor or attorney.

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