selling life insurance to your prospect
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Your Prospects and Clients
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The Value of Growing Life Sales Maximizing overall sales
Growing new sales rather than shiftingsales
Further strengthen the agent/client
re at ons p Competitive compensation
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If You Dont Sell Life Insurance
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,Somebody Else Will.
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Ways to Help Grow Life Sales
What Are the Easy Life SalesYOU Could Be Missing?
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Ways to Help Grow Life Sales
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Personalize your own version at www.thebrokerageinc.com(in the Resources tab).
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Ask Basic Questions Have you planned for your final expenses?
Would you like to leave a legacy gift to a special
person, organization, or charity? Have you prepared for your long-term health
care expenses?
yourself, how would you pay for long-term care services?
Do you have a rainy day fund? Are you happy with the rate of return you are receiving
on that investment?
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Life Sales You Could Be Missing Final Expense
Policy Review Using RMDs
Re uired Minimum Distributions
Charitable Bequest
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Final Expense Plans Dear Prospect As an independent agent, I offer a complimentary review to help
find a better buy in preparing for final expenses. Do you have a
moment to answer a few questions?
What is your age?
What do you estimate your funeral expenses to be?
o you oo o eave a egacy g o any spec a person, group, orcharity?
Thank you. What day/time would be best for me to drop by andreview the results with you?
I confident that the companies I represent will be able to providea program you will be provide real value to you. I look forward tomeeting you and helping you get a better buy for your premiumdollar.
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Use the Legacy Safeguard SystemTheLegacy Safeguard United
of Omaha presentation brochure
includes information about theLegacy Safeguard service and
United of Omahas Living
Promise Whole Life Insurance
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product to help you discuss finalexpense coverage with your
clients.
This brochure is easy to use andcan be used as a sales script for
your client presentations.
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Final Expense Plans
Statistics:
A one-time Social Security Death Benefit
payment of $255 is payable to the survivingspouse if he or she was living with thebeneficiary at the time of death, OR if livingapart, was eligible for Social Security benefits
'
month of death
The average funeral in the United States costs$6,500, according to the National FuneralDirectors Association. The true sum can easilyreach $10,000 once a burial plot, flowers andother costs are included, AARP says.
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Final Expense Plans
Twenty-four million U.S. households (22percent) have no life insurance protection
at all. Even among households with individual life
insurance, almost half carry coverage on
on y some ouse o mem ers. Almost one third of adults have no life
insurance protection,
the same as for thepast two decades.
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Final Expense Plans Final Expense Insurance policies are more flexible
than funeral insurance pre-need plans in several
ways. Most important is that the proceeds may beused for any purpose burial expenses of course,but also for outstanding debts to be paid, bequeststo individuals can be specified, or just leaving a
choice of beneficiary is not limited. This insurance is designed to be readily purchased
by people between the ages of 50 and 80 who arein a reasonable state of health not perfect health.
Simplified issue policies are recommended asfirst choice, as their cost will be the lowest and theface value benefits will be payable immediately.
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Wealth Transfer
Single-premium asset transfer into a life
insurance policy Immediately larger death benefit for heirs
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Wealth Transfer Case Study
65 female, Standard Non-Tobacco
$50,000 asset transfer
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Death
Benefit$156,366
The information presented is hypothetical and not intended to project investment results. Illustration is not complete unless all pages are included.
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Lifeexpectancy
age 85
Lifeexpectancy
age 85
The information presented is hypothetical and not intended to project investment results. Illustration is not complete unless all pages are included. 16
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Life Insurance Policy Review
Look to improve clients situation through: Lower cost for same coverage
More coverage for same premium Improved death benefit guarantees Enhanced policy performance
Tips: Identify policy goal Discover new sales opportunities Beat their expectations
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Final Expense Quote Engine
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Quick Easy Results Policy Review can help you:
Uncover additional client needs Gain more sales without more clients
Get more referrals
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Using Required MinimumDistributions (RMDs)
The truth for many clients:
Hasnt taken distributions and doesnt want
or need to. Would rather leave money for children or
grandchildrens benefit.
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RMD Sales Opportunity Case Study Bill
Age 70 (turning 70 this year)
$200,000 in qualified funds (entirely taxable)1
Currently in 25% tax bracket
Has to take RMD of $7,300 this year
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Standard non-tobacco rate class.
RMD rounded up to nearest dollar. Uniform Lifetime table from IRS.gov, 2013 Appendix C, http://www.irs.gov/pub/irs-pdf/p590.pdf#page=104
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RMD Sales OpportunityBills Options
1. Withdraw entire amount
2. Take RMDs and invest3. Buy life insurance with
Single-premium
RMDs Annuity
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Withdraw - Buy Life Insurance
YearInvest
(assumes 5% taxable
rate)
Life Insurance
NOW$140,000 $322,124
10 years$202,300 $322,124
20 years $292,300 $322,124
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Life insurance amount hypothetical.
Insurance values hypothetical and not to be used to predict actual results.
Assumes 30% tax bracket on lump sum
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Compare RMDs to Lump Sum
YearLump sumand invest
Lump sumand Life
Insurance
RMD andinvest
NOW$140,000 $322,124 $147,365
Year 10$202,300 $322,124 $229,259
Year 20$292,300 $322,124 $360,501
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Life insurance amount hypothetical.
Insurance values hypothetical and not to be used to predict actual results.
Assumes 5% return and 25% tax bracket (25% on lump sum)
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Use RMDs to Buy Life Insurance
Steady income stream that can be used to
buy life insurance Remaining qualified funds grow tax
deferred*
Excess RMDs can be invested
$5,475/yr ($7,300 after 25% tax) buys $154,455
death benefit
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Life insurance amount hypothetical. Insurance values hypothetical and not to be used to predict actual results.* The tax-deferred feature of the universal life policy is not necessary for a tax-qualified plan. In such instances, your client should consider
whether other features, such as the death benefit and optional riders make the policy appropriate for your clients needs. Before purchasing thispolicy, your client should obtain competent tax advice both as to the tax treatment of the policy and the suitability of the product.
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Taking RMDs Invest or
Life InsuranceYear Invest Only Life
InsuranceNOW $147,365 $297,803
Year 10 $229,259 $326,967
Year 20 $360,501 $374,467
Life insurance amount hypothetical.
Insurance values hypothetical and not to be used to predict actual results.
Assumes 25% tax bracket, 5% return on outside funds
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Another Option?SPIA Single Premium Immediate Annuity
Use a SPIA to buy the life insurance
Guaranteed payout for life
Potentially larger payouts
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Monthly Income SPIA
$1,321 for life*
$1,853 life -10 year certain**
Life only = $323,380
Life with 10/yr certain = $454,277
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*$991 after tax**$1,390 after tax
Insurance and annuity values hypothetical and not to be used to predict actual results.
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Life Insurance & Annuitize vsRMDs & Life
Year RMDs and lifeinsurance
SPIA to fund life
insurance
NOW
Year 10 $326,967 $323,380
Year 20
$374,467 $323,380
29Insurance and annuity values hypothetical and not to be used to predict actual results.
Assumes 25% tax bracket, 5% return on outside funds, and Life only SPIA
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5 OptionsWhich is BestSolution?Year Lump Sum Lump sum
and Life
Insurance
RMDs
and invest
RMDs andLife
Insurance
SPIA andLife
Insurance
NOW $140,000 $322,124 $147,365 $297,803 $323,380
Year 10 $202,300 $322,124 $229,259 $326,967 $323,380
Year 20 $292,300 $322,124 $360,501 $374,467 $323,380
30Insurance and annuity values hypothetical and not to be used to predict actual results.
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PLUS! Plan can be guaranteed with a death
benefit guarantee universal life product*
Money can be accessible
Cash surrender value
Acceleration of death benefit
31* Subject to premium payment requirements.
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A Charitable Bequest?A charitable bequestis a gift intended to serve a
religious, educational, political, or general socialpurpose to benefit mankind, aimed at thecommunity or a particular segment of it.
Life insurance is an excellent tool for making.
insurance provides an "amplified" gift thatenables you topurchase immortality on aninstallment plan. Through a relatively small
annual cost (the premium), a benefit far inexcess of what would otherwise be possible canbe provided for charity.
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A Charitable Bequest? Life insurance can be a self-completing gift. If the donor becomes disabled, the policy can
remain in force through the "waiver of premium"feature (if elected). This guarantees the ultimatedeath benefit to the charity and, in some cases,the same cash values and dividend build-up thatwould have been earned had disability notoccurred.
Even if the donor dies after only a few premiumpayments, the charity is assured a full gift.
The death proceeds can be received by thedesignated charity, free of federal income andestate taxes, probate, and administrative costs,and without any delay, fees, or transfer costs.
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Charitable Bequest Planning IdeasThere are a number of methods for including
life insurance in a charitable gift plan.
Make an absolute assignment (gift) of alife insurance policy currently owned,
,
have the charity purchase life insuranceon the donor's life and pay the annualpremiums (assuming insurable interest
and state law permits). Each of theseallows a current income tax deduction.
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Charitable Bequest Planning Ideas Use of dividends from existing policy.
Assign all annual dividends to charity.
This eliminates out-of-pocketcontributions, yet still creates a deductionas dividends are aid. Am lif the ift b
having these dividends purchase a newpolicy of which the charity is theirrevocable owner and beneficiary.
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Charitable Bequest Planning Ideas Name a charity as the primary or contingent
beneficiary of an existing or new life
insurance policy. Although this will not yield acurrent income tax deduction, it will result ina federal estate tax deduction for the fullamoun o e procee s paya e o echarity, regardless of policy size. This can beparticularly applicable in situations wherethere is only one logical beneficiary, or where
insurance is used to fund a supplementalretirement benefit and the death benefit is oflittle importance to the insured.
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Charitable Bequest Planning Ideas Most estate planning techniques become
even more effective when coupled with
other techniques. By giving appreciatedlong-term capital gain property to thecharit e. ., stocks, real estate, mutual
funds, etc.), the donor avoids capitalgains tax and receives a deduction forfull-market value (with notable
exceptions). Using this cash to then funda life insurance policy provides even moreleverage, creating an even larger gift.
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Discover the Value of Life Sales
Maximizing overall sales
Further strengthen the agent/clientrelationship Referrals
A itiona a es pportunities
More compensation for a sale
Growing new sales rather than shifting
sales
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Time for Action
1. Identify a concept youd like to use
2. Gather client names to visit3. Put it into practice
.
5. Opportunity to earn competitivecompensation!
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Time for Action
Consider multiple marketing programs toaugment your own client base.
Legacy Safeguard Sales System
Custom calling list
Faith-Based opportunities Direct mail
Internet leads
Brokerage Bucks
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Questions?