Are You Really Using Your Life Insurance License?

Case Study Below
How one Advisor added $75,000 of revenue by asking a simple question.

We are seeing more and more Advisors put added focus on helping clients put in place protection strategies. Using your life insurance license will give you added significance in the lives of your clients, can generate significant revenue for your practice and insurance protections done properly, will never lead to complaints, broker/dealer compliance issues or regulatory inquiry. Finally, life Insurance may be the last and best tax planning and wealth transfer strategy remaining when all the dust settles around new tax regulations.

Almost everyone is aware of the importance of life insurance. That being the case, why are you avoiding this discussion in your client meetings?

Recently, an advisor simply asked one of his good clients if he could review his life insurance program. This client was a super bright retired engineer and was a “do-it-yourself” type and luckily agreed to the review. Together we reviewed 5 life insurance policies and we quickly discovered some problems that needed immediate attention!

Client was age 65, male in excellent health, but a little stocky at 6’1 265 lbs. He had two policies (out of 5) in his Life Insurance Trust (ILIT) that were in trouble. One Universal Life with a death benefit of $1,000,000 had premiums of $5,600 annually and showed an expected lapse at age 81. The other troubled policy was also a Universal Life with a death benefit of $4,167,143 had premiums of $20,560 annually and showed an expected lapse at age 78. He had longevity in his family and created the ILIT to help maximize a wealth transfer strategy and he wanted to continue with that strategy.

We requested in-force illustrations that showed needed premiums to carry these policies to age 95 would require he spend about $3,200,000 over the next 30 years. A different way of looking at this would be looking at the net difference – Expected death benefit of the two policies was $5,167,143 less cost of $3,200,000 (over 30 years) equals Net Death Benefit of $1,967,143. Not a great IRR for a result that was still not guaranteed.

However, spending the money to keep these in force wasn’t what he was wanted to do but he was willing to do and had the where-with-all to do. Westland helped research alternatives and found solid alternate replacements that would cost less with better guarantees to significantly improve the IRR. Then we dug a little deeper and realized that the policies had solid cash values that totaled a little under $800,000 with high cost basis for an after-tax cash value of about $770,000.

This net-cash value information was critical so that we could now explore survivorship or second-to-die options more suitable in an ILIT and that are typically much more cost effective.

In the end two final scenarios were presented:

Use the $770,000 cash to buy a paid up survivorship policy. No additional out-of-pocket premiums.
Use the $770,000 cash to purchase a survivorship policy plus add $30,000 of additional premiums funded through the ILIT. A little more than what he was already contributing for premiums.

Scenario one (no further premiums) final recommendation:

Prudential Survivorship Guaranteed Variable Universal Life – Single pay $770,000 for a guaranteed death benefit of $2,019,087 to age 120. At a conservative 6.5% rate, the expected death benefit was nearly $3,500,000 if one of them reached age 95.

Scenario two (cash plus $30k annual) final recommendation:

Prudential Survivorship Guaranteed Variable Universal Life – Single pay $770,000 Plus $30,000 annually for a guaranteed death benefit of $3,266,934 to age 120. At a conservative 6.5% rate, the expected death benefit was nearly $5,239,702 if one of them reached age 95. Cost was $900,000 over 30 years.

Ultimately, scenario two was accepted and in the works. Client is content with the guaranteed death benefit for the cost and is extremely happy that he will likely realize the same death benefit for his legacy planning that he started with for much less cost.

For simply by asking a question, the compensation will be about $75,000. The process, with Westland’s assistance, was simplified and it has opened this advisor’s eyes to asking about and reviewing life and long-term-care programs for every client and prospect.

Reach out to our team today to inquire about a client situation.
Email: Timm@westlandinc.com
(800)238-8144 x127

If you could have an account that was 100% liquid and would balloon in value should a health event happen, would that be of interest?

If you could have an account that was 100% liquid and balloon in value should you pass unexpectedly, would that be of interest?

Many planners are seeing the benefits of one or both of these options every day.

Option 1 Sample – Female Client Age 65 Deposits $100k

$100,000 Liquid Account Value
$376,000 TAX-FREE Guaranteed Account Value for Long Term Care Expenses
$585,869 TAX-FREE Guaranteed Growth Account Value for LTC by age 85

Option 2 Sample – Female Client Age 65 Deposits $200k

$200,000 Liquid Cash Value
$425,200 TAX-FREE Guaranteed Immediate Death Benefit
3%-4% Expected IRR on Cash
$540,752 Expected Death benefit Tax-Free by age 85

Order these custom illustrations for one of your clients today.

Reach out to: Tim Morton
(800)238-8144 x127

During the last week we have worked on dozens of life, long term care, disability and annuity cases working alongside our Advisers.

If you are not discussing these issues with your clients, then who will?

Westland is here to help you protect your clients, their, families, their businesses and their portfolio.

These last few weeks have provided many opportunities for quoting of term life insurance and custom price sheets are available for your clients to easily compare pricing. However, the lowest price, might not be the best option, especially if conversion to a permanent option might be considered in the future.

Also, please ask your clients in advance about their health. We have processed several Preferred applications that have come back with offers of standard or rated. Even my own brother fudged his weight to me and we got a standard offer vs. his preferred rate expected at time of application. Now we are pivoting to a carrier that is more liberal with their build and BMI requirements for Preferred rates, but still more expensive than applied for and more work to be done. Now he tells me he is dieting and plans to lose 20 lbs. Live and Learn!

Case 1 – Client Age 41 Male High Earner.
Advisor called about this case to duplicate what she did for his spouse a few years earlier when she was with Merrill Lynch before transitioning her practice to an independent RIA.

We looked at many viable options to complete our due diligence in the client best interest and settled on Lincoln MoneyGuard with a 5% compound inflation option for him as well.

The illustration for a $60,000 single deposit provide an account that was partially liquid and provided a nice death benefit and nearly $200,000 in LTC benefits on day 1. The LTC benefit would grow to about $1,700,000 in LTC benefits by age 85 (liquid at over $20,000 monthly).

Case 2 – Traditional LTCi – New option to consider
Advisor had clients ages 62 and 64 married in PA and needed a traditional LTCi solution providing $6,000 monthly with 3% compound for 3 year duration.

Of course, these clients were quoted several months ago and you guessed it, today the pricing has already changed considerably. Mutual of Omaha is the gold standard for many cases today and their cost for this couple was $9,871 Annually. Very solid.

However, National Guardian Life has a unique shared benefit option that should be considered for many traditional LTCi cases today.

To save money, this carrier provides and and option, where they each would have a 2 year duration policy and they share a third 2 year policy (pool of benefits). Meaning, if one of them went on claim, they would first use their own policy benefits and if care still needed, they could tap into the third pool of shared benefits. Anything not used of this third pool would remain for the benefit of the surviving spouse.

The cost of this approach, was $7,916 annually for an annual savings of $1,955.

Call for assistance with any LTC, Annuity, DI or Life case today.

Tim Morton
(800)238-8144 x127
Email: timm@westlandinc.com

Sean Sahin
(800)238-8144 x120
Email: seans@westlandinc.com

Tyler Harris
(800)238-8144 x116
Email: tylerh@westlandinc.com

Westland is here to help you protect your clients, their, families, their businesses and their portfolio.

We have always stated that the cost of care and protection strategies may never be less expensive than they are today? Over the past several months we have had several cases that were presented to clients a few months ago or several years ago but the clients never moved forward with the recommendation. Many top producers don’t forget these earlier discussions and recommendations and will hopefully bring back the risk discussion with their clients in the future. However, many are shocked at the pricing changes that have happened to their favorite option from not that long ago. Remember that most insurance is offered at rates of the nearest age and one year can make a big difference or even make something unavailable due to Covid-19 restrictions or other changes in health. Sometimes a Save age option should be considered (back dating a policy) and is a common practice. Always consider the benefits and drawbacks of such a case.

In fact one case recently caused some concern when the client received their renewal notice just a few months after issue as the back dated anniversary date came due along with another premium payment so close to the first payment.

There are multiple reasons and excuses for the postponement of implementation recommendations. Just know that you will always have a resource in Westland, and we will research available options when the time comes and we’ll present what is in your client’s best interest.

Dig out those old proposals and re-engage your client discussions about life insurance, long term care planning, disability planning, Medicare planning, retirement income planning or safe accumulation accounts and allow Westland to go to work for you.

Case 1 – Young Advisors
What a difference in approach to incorporating protection strategies into a practice.

One young advisor regularly calls to discuss cases for his clients or the clients of the senior advisor of the office he works in. We have helped many clients put in force protection strategies that will always be their best interest with no regrets.

Another young advisor is so busy assisting his senior partner and trying to build his own practice with wealth management clients that he has little time to devote to protection strategies their clients need and want. He even complained about the extra effort and paperwork required and that it wasn’t worth his time. I fear there are many clients in their practice are exposed to risks that could easily have been mitigated with a solid protection plan. Luckily, we are moving forward with a relationship that will take advantage of our Trusted Advisor program where we do all the work after an introduction.

Trusted Advisor Program

Case 2 – Safe Money Legacy
Advisor had a client age 72 and was not in great health and wanted a safe way to boost his legacy. For this case, the Advisor moved $200,000 into the Allianz 222. This product has no fees and includes a Protected Income Value (PIV) that credits an immediate 15% bonus and grows at 150% of whatever is credited by the index allocation performance. At death, this PIV is available to his beneficiaries if paid over at least 5 years.

So this client deposits $200,000 and his legacy is worth $230,000 growing an expected safe yield 3%-8%. Examples: If the underlying index allocation credited 2% the PIV would grow by 3%. If the underlying index allocation credited 6% the PIV would grow by 9%.

Case 3 – Overfunded Life – Repositioned
This case involved a cash value whole life policy that was originally put in place by a previous employer as an executive bonus plan that would provide a future supplemental retirement income to the insured. After leaving that employer at age 62, due to a sale of the company, the Restrictive Endorsement was removed and he could continue the policy on his own, cancel it for the net cash value or exchange it into something else that would be more beneficial in his situation.

We worked with the advisor to get several in-force illustrations to try and salvage some current benefits at a reduced and affordable premium. We weighed these options from the current carrier with options available from other carriers

The end result was the current carrier’s best alternative was for a death benefit of $175,000 and annual premiums of just over $4,000.

We ended up recommending a John Hancock Protection UL with LTC Rider. The death benefit was set at $200,000 and premiums of $2,367. The LTC rider provided LTC liquidity of $8,000 monthly if care was ever needed.

The Advisor and client were both happy with this outcome.

Call for assistance with any LTC, Annuity, DI or Life case today.

Tim Morton
(800)238-8144 x127
Email: timm@westlandinc.com

Sean Sahin
(800)238-8144 x120
Email: seans@westlandinc.com

During the last week we have worked on dozens of life, long term care, disability and annuity cases working alongside our Advisers.

If you are not discussing these issues with your clients, then who will?

Westland is here to help you protect your clients, their, families, their businesses and their portfolio.

I have been asked many times “At what age should LTC be purchased” and the short answer is, today! Today, may be the healthiest day of the rest of your life and insurance products will likely never be less expensive in the future. You definitely must buy insurance before you need it.
Case 1 – Young Couple – Supplemental Retirement
Clients, ages 39 and 41 sought to add additional life insurance to protect their family and had been introduced to a permanent concept. The primary breadwinner was underinsured using a simple needs analysis. Current coverage was $750,000 with about $80,000 in income. They had goals, to retire about age 65, fund college education for two young children and to pay off the mortgage. For about $100 per month, they could add $1,000,000 20 year term for him and $500,000 for her. Should the worst happen to one or both, the family would now be much better positioned to continue financially.

We also illustrated a permanent option for consideration so that they would have some death protection if they survived the term insurance and to supplement retirement.

For $300 per month each:

Him: Max funded IUL starting death benefit of $100,000. At age 65 the death benefit expected to be $267,000 and cash value $167,000. The hypothetical TAX-FREE income to age 95 was just over $14,000 annual. At age 85 the death benefit was $122,000. The estimated account value needed to generate $14,000 tax free was over $430,000 at his age 65.

Her: Max funded IUL starting death benefit of $125,000. At age 65 the death benefit expected to be $321,000 and cash value $198,000. The hypothetical TAX-FREE income for to age 95 was just about $17,000 annually. At age 85 the death benefit was $140,000. The estimated account value needed to generate $17,000 tax free was over $500,000 at her age 65.

Case 2 – High Blood Pressure – “White Coat” Syndrome
Agent had applied for large term life policy at a Preferred health rating and was made an offer at Standard Table 4. Findings were that, though she was a young high achiever, she had very high blood pressure. This was uncontrolled. The first explanation response was, that the high reading during the paramedical exam was related to anxiety. Sometimes referred to as “white coat” syndrome – a fear of doctors. After a more thorough review of medical records, it was determined that the issue was a bit more serious and this client should be addressing her medical condition.

We recommended that she accept the coverage at the rated table-4 rate and work on getting her blood pressure under control via diet, medication or other stress relief measures. Then we could request a reconsideration with the current carrier or seek out new coverage after one year. Even though this client would be year older, the coverage would still be much less expensive if she could qualify for Standard Health and no table rating and hopefully her health would be much improved.

Call for assistance with any LTC, Annuity, DI or Life case today.

Tim Morton
(800)238-8144 x127
Email: timm@westlandinc.com

Sean Sahin
(800)238-8144 x120
Email: seans@westlandinc.com

During the last week we have worked on dozens of life, long term care, disability and annuity cases working alongside our Advisers.

If you are not discussing these issues with your clients, then who will?

Westland is here to help you protect your clients, their, families, their businesses and their portfolio.

Case 1 – Guaranteed Income
A Client received some guidance from a respected source to them – a Knights of Columbus Insurance Agent. He had been their insurance agent for years. These clients were doing fine financially at ages 61 (him) and 60 (her) with almost $2,500,000 in net worth, $1,100,000 liquid and $1,400,000 in real estate equity. He was still working part time and their shortfall monthly was only about $1,500. Their financial planner was concerned because they seemed to be drawing much more than the $1,500 monthly from their Schwab account. Extra cash needed for home repairs, gifts, college tuition, etc. There just wasn’t any discipline and their plan was not showing success to age 100. They mentioned to their insurance agent friend their concern and a plan was proposed to add an annuity to guarantee income that would make up for the shortfall. They liked the new plan and then the rest of their portfolio could grow and be used for these extra unplanned activities that supported their lifestyle.

Down the road, if they needed additional funds they would tap into their rental property equity that was now standing at over $900,000. This was also their fall back position for a LTC event for one or both of them. He was uninsurable and very likely not reach age 100.

The Advisor didn’t like the plan at all and said some things that were very concerning. Stating annuities had high fees, expenses and commissions. And that he could better manage the portfolio to give them the systematic income desired and still achieve some growth, better than the annuity could.

Not all annuities have high expenses and I hope he is right about assuming the risks of the market, longevity risk and sequence of returns risk with his portfolio management abilities.

He didn’t want to take the time to do the analysis of the new plan using and indexed annuity, but only saw this as a threat to share responsibility with another outside trusted advisor. I’ll give you more details next week as we dig into the case a bit more and we’ll either support diversification to an indexed annuity or not. Stay tuned.

Case 2 – Life Replacement
Client Male age 57 had a $500,000 death benefit whole life policy that had an annual premium of $5,000. Cash Value was about $137,000. We replaced the policy with a John Hancock Protection UL including LTC and no additional premiums. The guarantee would take the client to age 90 and at current rate and costs to age 125. If needed, would provide up to $20,000 monthly for LTC costs.

Call for assistance with any LTC, Annuity, DI or Life case today.

Tim Morton
(800)238-8144 x127
Email: timm@westlandinc.com

Sean Sahin
(800)238-8144 x120
Email: seans@westlandinc.com

Westland is here to help you protect your clients, their, families, their businesses and their portfolio.

Case 1 – NEGLECTED CLIENT – DEVASTATING
A Client couldn’t get hold of their Advisor (retired) and he called the carrier after receiving a potential lapse notice. The carrier referred the case to Westland.

This client was 83 years old and had been faithfully paying on his Universal Life policy for over 30 years. He had thought he was being responsible and if he just paid his premiums on time, his insurance would be there when he passed and he would leave a nice legacy for his spouse or family.

Unfortunately this was not the case. His advisor had not served him well and he ignored or didn’t understand the information presented to him on each annual statement received.

I confirmed with the carrier information about his policy. Yes, his premium would need to increase about 6 times to just keep the insurance in force for just another year and would have to increase about 15 times annually to keep it in force to age 100. Both options totally unaffordable and did not make sense. It seemed that he would easily live 10+ years and he would have to spend more than the death benefit over that time to keep his insurance. I could hear the devastation in his voice as he came to a realization that he was not going to be able to continue the life insurance and leave a nice nest egg for his family as planned.

I consoled him with the facts that his family has been protected for many years, should the worst have happened and that he should be thankful that he has been blessed with good health that will likely carry him well into his 90’s.

Take-a-ways: This situation was so avoidable if action was taken early in in the life of the policy. Don’t neglect your responsibility to provide continued service after the sale and make sure you have explained and presented what is being offered credibly so clients know what may happen in the future.

Perform routine policy reviews for products you sold and even for those products that your clients own that you did not sell. You will find many opportunities to assist and Westland will be happy to help you help your clients. Reach out to us anytime.

Simple Policy Review Check List

Case 2 – Policy Review Done Right
I received a copy of a client statement for a John Hancock Protection UL policy with a LTC Rider to review. This was sold 5 years ago with a $100,000 single pay deposit to a Female age 65 at Standard Health. The policy provided $224,146 in death benefit being 100% liquid for any potential LTC costs at $8,966 monthly available. Still a very viable solution for many clients today.

We assisted the Advisor with this review and recommendation.

5 years ago your original hypothetical illustration used during the application process reflected a 5.05% rate. At that time, John Hancock assumed they could maintain that rate to carry your policy to age 125. However, the renewal rate history reflected in your statement over the past 5 years shows that this rate has not been maintained by John Hancock. The current rate is at 4.55%.

As stated in your John Hancock correspondence, if you do nothing and the rate remains at 4.55% and they don’t change the cost of insurance, your policy will still carry to your age 100.

To provide a little more cushion, you could pay an additional $352 annually to carry your policy to age 105. Again, this is assuming today’s rate of 4.55% remains constant along with the current cost of insurance. Please note that if rates improve over time, your statement will reflect a higher age that your policy will carry to at current costs.

We are happy to provide other options for consideration and we can discuss these during our follow up call next week.

You should always review your annual policy statement and understand what it is telling you. You don’t want to get caught down the road and see that your policy may be in danger of lapsing without a high amount of additional premium.

Call for assistance with any LTC, Annuity, DI or Life case today.

Westland is here to help you protect your clients, their, families, their businesses and their portfolio.

Case 1
Client had $700,000 in cash and just wanted a safe place for a portion with a higher earnings potential vs. bank savings and money market rates. She wanted to keep funds liquid. Age 53 Female (Widow) Table 2 Rated Health.

We placed $400,000 into the North American (A+) Smart Builder Indexed Life Insurance product with the “Waiver of Surrender” option to keep the cash value liquid. Her worst case over the first year is still positive, but she should expect 3%-4% yield with average S&P 500 index performance.

Sample Smart Builder Illustration F Age 53 Table 2 $400k

Case 2
Pacific Life PremierCare cases. Get contracted now even if you have current production or have done business with Pacific Life in the past. An new appointment through Westland will not change anything with your existing appointment.

Case 3
LPL Advisors – Great News! I can walk you through ClientWorks as needed to get your OBA processed and approved for doing business with Westland. Reach out to me anytime.

Lock in their insurability and create a Roth like account that can be used for any purpose – Tax Free funds. This illustration shows how $100 per month might perform for a one year old you love.

We ran this one showing supplemental retirement income. Give your children, grandchildren, nieces or nephews a personal pension and/or a death benefit for their family should the unexpected happen.

Sample one year old illustration

A gift that will last a lifetime – you will always be lovingly remembered. Ask for an illustration now. We can show college education funding, first home purchase assistance or supplemental retirement income. One strategy or any combination of these.

Westland is here to help you protect your clients, their, families, their businesses and their portfolio.

Case 1
$1,000,000 30 Term Case for a 38 year old was requested. Once we discussed the case and the need we presented two alternative solutions. Cost $95 monthly for 30 year term.

First alternative – split up the case, $400,000 20 year term and $600,000 30 year term. This will save a few bucks since this was primarily for income protection and at age 60, after the 20 year term expires, there is less need until retirement age. Cost $87 monthly – save $100 year.

Second alternative – split up the case, $300,000 permanent with LTC of $12,000 monthly and $700,000 20 year term. Cost $182 for 20 years and then $140 for life. More cost, but will receive a benefit – either for LTC expenses or death benefit.

Case 2
Client age 57 (Widow) was beneficiary on 4 different annuities (2 IRA and 2 TSA). As the surviving spouse, she may continue these or move to her own IRA. We requested current statements for each account and called the carrier for each annuity to make certain we had all the information available prior to just jumping into providing an illustration.

We took the time to make sure the solution presented would be suitable and in the client’s best interest. Will your IMO/BGA do the same?

In this case, three of the four annuities were absolutely in the client’s best interest to move into her own IRA. They either didn’t have an income rider, the income rider wasn’t great and not needed, or there was an enhanced death benefit option. All waived surrender charges and/or MVA at death for the beneficiary. This client also wanted and liked the protection of what an Indexed Annuity Offered, so we went in search of a solid short term Accumulation product with an uncapped upside index? Some products are only offered to registered representatives and this was the case in this situation. We settled on a 5 year duration product for $250,000 and she still had over $500,000 in liquid cash assets to manage.

Call Sean Sahin at (800)238-8144 x120 to discuss any potential annuity cases. You will be clad you did. Sean can also be reached at seans@westlandinc.com.

Call for assistance with any LTC, Annuity, DI or Life case today.

Tim Morton
(800)238-8144 x127
Email: timm@westlandinc.com

Sean Sahin
(800)238-8144 x120
Email: seans@westlandinc.com