Thursday, September 18, 2014

Connecting with Clients through Better Communication

Cutting through preconceived ideas, myths and misperceptions is a very important part of helping clients understand the value of your products. It’s important to understand where your client is coming from so you can present strategies to serve their needs. For your client, their PERCEPTIONS make up their reality.

It takes some time, patience and good communications skills to help them construct new perceptions. The goals and needs of your clients as well as the ways they best share and receive information may differ. So, understanding these differences and modifying your approach to each client can make you a more effective and successful communicator. It’s a cycle to find success – listen to client, understand needs, present options, listen to client. Don’t just explain the product, explain how a product or products can address their specific needs and the value provided for their situation.

Good communications skills help foster the client's trust in you and in the strategies you are suggesting they consider. With intuition and instinct, you can use the conversation as a way to understand both financial and personal goals of every individual. The personal life objectives are every bit as important as the financial ones and can have a large impact on the client’s overall plan. A good discovery process during the initial meeting, as well as yearly assessments are helpful to better understand your clients evolving needs.

You may not realize it, but you could be unintentionally eroding trust early on by making strong statements about the “right/best way” for prospects to manage their resources – with little if any understanding of their situation or goals. These pronouncements of the “right way” have the emotional effect of forcing the hand of the prospect – robbing them of their freedom to choose. Taking this approach and making absolute claims, such as these, could not only result in tension and create distrust but are also problematic and should be avoided.

Presenting options after you have asked questions and completed a detailed fact-finder helps build trust and help you address your client’s real concerns.

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


Thursday, September 11, 2014

Navigate the Waters of Mortality Underwriting and Clinical Assessment

Mortality underwriting and clinical assessment are certainly not the same (but we can say that they are close cousins). The purpose of a clinical assessment is to determine a diagnosis for an individual, treat that diagnosis, and then hopefully either resolve or stabilize that diagnosis. Mortality underwriting reviews a person’s diagnosis, treatment, and resolution (or stability), and then evaluates the claim history to determine the individual’s life expectancy. Therefore, underwriters are not attempting to make a diagnosis for an applicant — they are simply attempting to review the information provided by the physician and then put it against their claim history. In reviewing an applicant’s medical history, an underwriter uses his/her experience in reviewing and understanding medical terminology, procedures, and evaluations to assign the manual’s classification.

So… how does Partners Advantage underwriting help with this difference in concept? You have the benefit of access to an underwriting staff that truly understands mortality underwriting and the lay of the land of underwriting manuals. Talk to our underwriting staff to help you navigate the waters of mortality underwriting and clinical assessments.

Call 888-251-5525 to learn how our underwriting staff can help you!

PAIS 03081214

For financial professional use only. Not for use with the public. This material is intended for education purposes only, does not address individual circumstances, and is not intended to provide specific life insurance advice.

Thursday, September 4, 2014

The Power of Tax Deferral in Advanced Markets

Whether your clients realize it or not, the income tax environment has already changed for the years ahead. The Bush era tax cuts have ended. Income taxes have reverted to historically high levels. The top marginal rate for those married and filing jointly is 39.6%. The top marginal rates for state income taxes are as high as 9%–11% for many highly populated states. This double hit could create an overall tax bite near 50%, which could send many investors searching for shelter. Capital gains tax is potentially as high as 20% for affluent investors, while non-qualified dividends are taxed as ordinary income at top marginal rates. In addition, thanks to new excise taxes designed to fund Medicare increases, the effective capital gains tax for high-income investors rose to about 24%.

The Oval Office and Congress are trying to find new ways to stimulate the economy. Pre-retirement clients could find themselves trying to make money in a historically low interest rate and historically high tax environment. Compounding the problem is the fact that many experts think interest rates will most likely trend upward in the future. So investing in a bond portfolio today could potentially place the pre-retirement client in the position of receiving low return coupled with a possible reduction of principal when interest rates do rise.

Annuities are often a preferred type of financial vehicle in more aggressive tax environments. The table below illustrates the recognized benefit of tax-deferred growth.

The Power of Tax Deferral
Let’s look at a $250,000 investment at 5% for 15 years.

Accumulated Values
Deferred                   $519,732
In a 39.6% bracket $390,912
In a 25% bracket $434,428
Capital Gains         $438,212
Additional benefit-enhancing features of tax deferral include:
Helps avoid probate costs
Stretch tax treatment upon death
Availability of an exclusion ratio for retirement payments
Helps avoid the lost opportunity value of money paid in taxes
Potentially avoids bracket creep due to investment income

Annuities could make sense in an aggressive tax environment, as they also have the ability to reduce the risk of market volatility surrounding the retirement event. Annuities accomplish this with guarantees,* floors, lifetime income, and protective options.

Remember, if you want to talk annuities to your clients, talk about taxes first.

*Guaranteed lifetime income available through annuitization of the purchase of an optional lifetime income rider, a benefit for which an annual premium is charged.

* This material is intended for education purposes only and is not intended to serve as the basis for any investment or purchasing decision. Pursuant to IRS Circular 230, it is not intended to provide specific legal or tax 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.

Annuities are insurance products backed by the claims-paying ability of the issuing company; they are not FDIC insured; are not obligations or deposits of, and are not guaranteed or underwritten by any bank, savings and loan or credit union or its affiliates; are unrelated to and not a condition of the provision or term of any banking service or activity. Product features vary by state and restrictions may apply, including possible withdrawal charges. Positive index adjustments may be limited to a monthly maximum or participation rate. Tax-deferred interest accumulation offers no additional value if the annuity is used to fund an IRA under current tax law; additionally, tax deferral may not be available if the owner of the annuity is not a natural person such as a corporation or certain types of trusts.

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

PAIS 04081314

Thursday, August 28, 2014

What Women Want

Although women comprise 50.8% of the nation’s population¹, some financial professionals are still overlooking this powerful market. If you haven’t worked with many female clients or you’re not targeting them as prospects, you’d be wise to readjust your focus, especially after pondering these intriguing statistics:

  • When their spouses die, experts estimate that 70% of women change their insurance or financial professionals within a year of being widowed²
  • Women control 70% of household purchases³
  • The majority (60%) of women are the primary household breadwinner⁴ 
  • 29% of women earn more than their husbands⁵

So what do women want from their retirement or financial professional? Keeping the following information in mind when prospecting for or working with women clients.

  • Always grant women the same courtesies and respect you extend male clients. Look women in the eye and never talk down to them.
  • Listen, and listen well. Women want to know they’ve been heard, so be sure your responses acknowledge the concerns they’ve voiced. Try saying things like, “So base on what I’m hearing, your biggest concern is…” or, “It sounds like you’re describing a fear that you’ll [outlive your money, become widowed, etc.]; is that correct?”
  • Many women need to trust you before they’ll do business with you, so nurturing relationships with female prospects may take longer. Your performance history and credentials might not be enough to seal the deal, so focus on earning trust instead of self-promotion. 
  • Women often do their research before making any big-ticket decisions. You might help by providing accurate and detailed information on the insurance products under consideration. In short, the more knowledge the buyer, man or woman, the more confident they may be in buying.
  • Women have a greater life expectancy than men,⁶ so they may tend to be interested in products designed to address longevity, like annuities or long-term care insurance. Therefore, it can be important for you to talk to women about maintaining their lifestyle in retirement — especially given their current situation (whatever that may be), and offer solutions designed to help them reach their individual financial goals. 

¹ United States Census Bureau: 
² Kristan Wojnar and Chuck Meek, "Women's Views of Wealth and the Planning Process: It's Their Values That Matter, Not Just Their Value," Advisor Perspectives, March 2011, as reported in “Fidelity® Provides Information and Tools that Help Advisors Design Action Plans to Deepen Relationships with Female Clients,” Fidelity: 
³ “Women in the Labor Force: A Data Book, February 2013,” U.S. Bureau of Labor Statistics: 
⁴ “The 2013 Allianz Women, Money and Power Study”:  
⁵ “Labor Force Statistics from the Current Population Survey,” U.S. Bureau of Labor Statistics. Last modified 24 March 2014: 
⁶ “U.S Life Expectancy Map: The Gender Gap,” National Geographic:  

For financial professional use only. Not for use with the public.

Thursday, August 21, 2014

Carpe LIAM: The Ideal Time to Offer Your Clients a Complimentary Life Insurance Checkup

While we can’t know what the future holds, we do know that an awful lot of change — minor or significant — can take place in any given year. Odds are good that the changes many of your clients have experienced over the past 12 months have also reshaped their life insurance needs, whether they realize it or not. So, as this September’s Life Insurance Awareness Month (LIAM) approaches, why not put its momentum to work for you and your clients by seizing this opportunity to offer your clients a COMPLIMENTARY life insurance checkup or review?

Your professional experience can prove invaluable when it comes to making potential adjustments to a client’s life insurance coverage, so instituting complimentary annual life insurance reviews with all of your clients could be a win-win situation. Leverage LIAM to heighten awareness, and you may be surprised by how many clients — and prospects — will take you up on your offer for a complimentary checkup of their insurance needs.

Here’s a quick list of life changes to consider exploring with your clients:
  • A marriage, divorce or separation
  • The receipt of an inheritance or financial gift
  • Any serious health issues affecting either spouse
  • The birth or adoption of children or grandchildren
  • Updates on their retirement health plan 
  • A need to provide a parent with health care, financial help or other assistance
  • Buying a new home (or conversely, losing a home)
  • Securing home refinancing or a reverse mortgage
  • Long-term care needs for family members 
  • Changes in their employment situation — including promotions and severances
Providing virtually anyone with a complimentary annual life insurance checkup will help strengthen your brand and your bottom line, since not only does it let you actually show your clients how much you value and care about their needs, but it can also lead to increased earnings as well as a possible surge of new referrals from your very satisfied clients.

LIAM is just around the corner! Click here for a COMPLIMENTARY Life Insurance Checkup Tool you can use to drive client and prospect meetings.

For financial professional use only. Not for use with consumers.
PAIS 02072214

Thursday, August 14, 2014

Documentation Is Important in Every Step of the Sales Process

When working with clients, there’s going to be a great deal of documentation. This is especially true during the application process. There are different factors that influence the documentation process, including state regulations.

The list below isn’t exhaustive for when the application is taken, so be aware of your state’s requirements.
Get copies of all sales materials.
Make copy of all the pages of the signed Annuity Disclosure at application.
Original sales proposals.
A copy of any needs analysis completed during solicitation.
Copies of all sales advertisements and materials used during the sales process.
Written corresponded to or from the contract owner, subsequent service of the contract, or issuance of the contract.
Documentation of phone calls.
Notes from all meetings with the customer.
A copy of the signed delivery receipt.

The reason all of this is important is because clarification is sometimes needed during the application process or there are errors that need to be fixed. When copies of documentation are taken, it becomes easier to make these corrections. Any changes should be made on the form and initialed by the customer. Then make copies of the changes in documentation, as this may need to be produced later for the regulator. It’s best to be over prepared.  If changes are made, clients should also be provided with any applicable copies as well.

Each state has different regulations regarding the length of time client documentation is maintained. Be sure you understand and follow the regulations for your state and license. General rule of thumb is to maintain all active client files indefinitely and all of your inactive files for at least seven years.

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

PAIS 1407028

Thursday, August 7, 2014

Practice the Four “D’s” to Better Manage Your Time

As you develop a plan for each week, purposefully decide how to allocate tasks across the days. Practicing the four “D’s” can be a useful way to manage your time.

*Do it. This task needs to be done. It's important and urgent.
*Delegate it. Delegation is one of the most talked about yet underused time management techniques. If done well, delegation allows you to potentially train others and it frees up your time for more important tasks. If done badly it can increase burnout, absenteeism and reduce work morale.
*Dump it. This task is not important. These types of tasks are likely to have been on your to-do list a few days and are not likely to be done.
*Defer it. Do this with a task that needs to be done, but does not need to be done today. The danger of deferring important things is that they will become urgent — this can increase your stress. Make sure that you are using a planning tool that schedules or reminds you when it needs to be done.

For financial professional use only. Not for use with consumers.
PAIS 01071714