NAIFA's Advisor Today November/December 2016 Edition

Three Crediting Strategies

•

• Higher participation rate with lower cap

• Lower participation rate with no cap

Access to Cash

• Two kinds of loans (standard and index)

• Withdrawals

No-cost Riders

• Guaranteed Refund Option Rider

• Accelerated Death Benefit for Chronic Illness and Terminal Illness Income

Advisor Today’s Podcast Series:

Building a More Successful Practice

Make the most of your morning commute by listening to Advisor Today’s Podcast Series: Building a More Successful Practice. Learn how to attract high-quality prospects, target niche markets, create exceptional value and deliver the type of service that will wow your clients.

FOR QUICK ACCESS: Simply visit www.AdvisorToday.com, click the “download” button above “Past Podcasts & Subscribe,” and the podcast will start playing.

DOWNLOAD INSTRUCTIONS:

It’s also easy and convenient to use a podcast application, such as iTunes, to subscribe to our podcasts. Once you subscribe, the podcasts are automatically downloaded to your computer or mobile device as they become available. If you don’t already have iTunes, download it for free at https://www.apple.com/itunes. Then, complete the following steps from your computer or mobile device:

1) Go to the podcast page on the NAIFA website by clicking “Past Podcasts & Subscribe,” which will take you to www.advisortoday.com/podcasts/index.cfm.

2) You will see a green box marked “Subscribe on iTunes” above the list of podcasts. Click the box to open iTunes on your computer or mobile device.

3) Once iTunes opens, there are multiple options available. You may click the “Subscribe” link under the Advisor Today thumbnail image to download the most recent podcast, as well as all future podcasts, to your iTunes account. Or simply click on the word “free” under the “Price” column to download podcasts individually. At this point, the selected podcasts will show up under “Podcasts” in your iTunes library.

32 Meet NAIFA’s New President

Paul Dougherty’s dedication to the profession and exemplary leadership skills will come in handy as he leads NAIFA toward a bright and prosperous future.

–Ayo Mseka

FEATURE

38 NAIFA’s 2016 Performance + Purpose Conference

If you weren’t in Las Vegas for this year’s NAIFA Performance + Purpose Conference, you missed a great event. Here are a few highlights of this important meeting.

–Ayo Mseka

MANAGING YOUR PRACTICE

13 I Love My Job, But I Don’t Want to Do it Forever!

Before you make your move, gradually transition your clients to another advisor or they might take their business elsewhere.

–Bryce Sanders

14 Building a Practice You Love

The key is to find a product or market you love and work exclusively in it.

–Brad Elman

15 The New American Dream Happiness and security are now valued more considerably than wealth, opportunity and moving up in one’s social class.

–Ayo Mseka

21 Leveraging the Power of Study Groups

Here is how to get the most from study groups, which can help your advisors take their practices to the next level of success.

–Robert Faingold

FINANCIAL PLANNING

16 A New View of Retirement

Enrich the lives of your clients who are 55 years old and over by helping them see retirement as a time for recess.

–Steve Decker

17 College Education Funding: Helping Clients Evaluate What’s Best Work with your clients and help them determine how to pay for the “right” college for their children.

–James Mahaney

19 Portfolio Allocations for New Market Conditions

The use of alternative strategies can help investors ride the wave and minimize losses in the long term.

–David Miller

Call for Nominations for the 2017 JNR Memorial Award

Help NAIFA honor its best and brightest by nominating outstanding members for the 2017 John Newton Russell Memorial Award. To nominate a NAIFA member, visit www.naifa. org, click on the John Newton Russell Memorial Award box and fill out the form. You can also complete the form on page 22 and mail it to the address listed on the form.

CRITICAL ILLNESS INSURANCE

24 An Interview with MassMutual’s James Ocampo on Critical Illness Insurance

–Ayo Mseka

LTCI

26 Start with “Why”

In selling long-term-care insurance, start with why, since clients do business with you because of why you do your job as an agent.

–Deb Newman

28 Best Practices for Selling Group LTCI

Help your clients execute a successful enrollment strategy by encouraging them to emphasize the value of buying LTCI at the workplace.

–Brian Harrington

DI INSURANCE

30 From Yes to Success

Here are six ways to ensure that your next IDI application sails through underwriting. –Sue Schweitzer

SALES AND MARKETING

46 4 Ways to Build an Effective Email Marketing System

Use an email service provider, segment your lists, determine the frequency of your communication and use reporting tools strategically.

–Toni Harris Taylor

PRACTICE SPECIALTIES

PRACTICE SPECIALTIES

PRODUCT SPOTLIGHT

on the WEB

The Advisor Today Blog

Available at www.AdvisorToday.com

The Advisor Today Blog brings you the tools, ideas and techniques you need to build a successful practice. Fresh content is posted regularly, and we welcome your feedback and ideas in the comments section.

We look forward to hearing from you!

web poll

How do your opinions stack up against other NAIFA members? To zero in on the topic of this issue’s web poll and find out, answer this question at www.AdvisorToday.com:

What products were your bestsellers this year?

• Retirement-Planning Products

• Life Insurance

• DI Insurance

• Health Insurance and Employee Benefits

• Critical Illness Insurance

Answer this question at www.AdvisorToday.com.

archives

Available at www.AdvisorToday.com

The Advisor Today website features full archives of the magazine’s articles, as well as webexclusive articles. This resource is worth visiting frequently.

social media

Join the conversation via Facebook, Twitter and LinkedIn. Simply log on to www.naifa.org and click on the social media icons.

podcast series

Building a More Successful Practice

Available at www.AdvisorToday.com/podcasts

In this podcast, John Hancock executive Brooks Tingle gives an update of the company’s new life insurance product, which rewards policy owners for living a healthy lifestyle.

digital magazine

available at www.AdvisorToday.com/digimag

Do you know that you can access the digital version of Advisor Today from your desktop or even your mobile device? Simply log in with your NAIFA member number and password, and you can gain access to the current issue and archives of past issues. Go to www.AdvisorToday.com/digimag to get started today.

By Ayo Mseka

Advisor Today Goes All-Digital!

Advisor Today will become a digital-only magazine, beginning with the January/February 2017 issue. This move will enable us to substantially enhance the magazine and make it a more valuable resource for you and the clients you serve.

The magazine will keep its name, Advisor Today, and will continue to be published six times a year. It will be available via www.Advisortoday.com, as well as on tablets and other portable devices.

With the move to an all-digital platform, you will continue to get the same great content that has set Advisor Today apart from the rest for more than 100 years: feature articles that inform and inspire, techniques that the best in the business use to attract a steady stream of high-quality prospects, innovative sales ideas that expedite the client-acquisition process, insightful interviews with industry greats on what it takes to succeed, expert advice on the most troubling aspects of your business and proven techniques for managing your day-to-day operations. Also in the lineup for 2017 are some of your most treasured favorites, such as a look at the lighter side of life and the thought-provoking Back Page.

High-tech, High-touch

But with an all-exclusive online platform, you get even more: the latest industry news and trends and how they affect your business, as well as frequent legislative and regulatory updates. Also, we will be able to receive immediate feedback from you, which will enhance our ability to provide you with information that caters to your specific editorial needs. In addition, it will be easier for you to gain access to past issues of the magazine and share articles of interest with your prospects, clients and colleagues.

At Advisor Today, we are committed to maintaining the high editorial standards that have made the magazine a top NAIFA benefit and one of the best publications in the industry. We know that it is a tool you have come to rely upon for the strategies you need to thrive in a business environment that is marked by constant change. As the pace of change accelerates, we believe that an online platform is our best chance to give you precisely what you need: customized solutions that help you master emerging opportunities.

We are excited about this new development at Advisor Today and look forward to hearing from you. We wish you great success during this holiday season and even greater success in 2017.

ADVISOR TODAY

Editor-in-Chief

Ayo Mseka; amseka@naifa.org

703-770-8204

Publication and Circulation Coordinator

Tara Laptew; tlaptew@naifa.org

703-770-8207

NAIFA

Kevin Mayeux, Esq., CAE, CEO kmayeux@naifa.org; 703-770-8101

Michael Gerber, COO & General Counsel mgerber@naifa.org; 703-770-8190

Diane Boyle, SVP, Government Relations dboyle@naifa.org; 703-770-8252

John Boyle, AVP, Professional Development & Education jboyle@naifa.org; 703-770-8267

Magenta Ishak, VP, Political Affairs mishak@naifa.org; 703-770-8152

Jennifer Cassidy, VP, Finance jcassidy@naifa.org; 703-770-8125

Sheila Owens, VP, Communications and Marketing sowens@naifa.org; 703-770-8112

Diane Powers, VP, Professional Development and Education dpowers@naifa.org; 703-770-8226

Mark Rogers, VP, Information Services mrogers@naifa.org; 703-770-8130

Brian Steiner, VP, Business Development & Strategic Partnerships bsteiner@naifa.org; 703-770-8220

Gary Sanders, Counsel and VP Government Relations gsanders@naifa.org; 703-770-8192

Michele Grassley Clarke, VP, Membership and Association Services

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NAIFA’s Advisor Today articles do not constitute insurance, financial, investment, tax, legal, accounting or other professional services by the publisher, NAIFA, or the articles’ authors. The facts and opinions in NAIFA’s Advisor Today articles represent their authors’ views and are not necessarily endorsed by the publisher or NAIFA, unless indicated. While NAIFA’s Advisor Today tries to provide accurate reporting, the accuracy of the information in NAIFA’s Advisor Today is not guaranteed. NAIFA’s Advisor Today reminds readers to ensure that the manner in which they sell insurance and other financial products, and the advertising and sales materials they use, comply with state, federal, and FINRA/SEC requirements, and the compliance rules of the insurance and other financial services companies they represent. If in doubt about compliance issues, check with your company. The publisher and NAIFA disclaim all liability for claims or damages that may result from errors in the magazine. NAIFA’s Advisor Today will attempt to correct material errors brought to its attention through appropriate errata. The publisher and NAIFA do not endorse the advertisers in NAIFA’s Advisor Today, or the advertised products and services, unless indicated. The publisher and NAIFA have not assessed the accuracy of any advertisement or the quality of any advertised product or service. The publisher and NAIFA disclaim all liability for claims or damages that may result from transactions with NAIFA’s Advisor Today’s advertisers or from the purchase or use of advertised products or services.

Individuals annually earning in excess of $500,000 need disability bene ts that can keep pace with their a uent lifestyle - they need High Limit Disability. The bene ts of a recently-insured surgeon, making $1,100,000 consisted of:

$10,000/month Group LTD

$15,000/month Individual DI $32,000/month High Limit DI Call (800) 345-8816 or visit www.piu.org

Surgeon

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Income: $1,100,000

Total Bene t: $57,000/month

view point

By Paul Dougherty, ALHC, HIA, LUTCF, FSS

Transforming NAIFA

It is an honor and a privilege to serve as your president. With your help and support, I am confident that we will take NAIFA to new heights of success.

For more than 125 years, NAIFA has been committed to building and advancing the financial- services profession with programs and services that inform and educate insurance and financial advisors. With members in every congressional district in the nation, NAIFA is also one of the most effective lobbying organizations in Washington, D.C.

But for two decades, NAIFA has experienced significant declines in membership and revenue, prompting the association to respond with a new business model that diversifies revenue and grows membership while maintaining the association’s position as a relevant and forward-thinking organization.

Complacency is no option when the marketplace around you is undergoing a dramatic change. That’s why NAIFA has taken on the task of reinventing itself to better serve you and your clients. The roadmap guiding this transformation is NAIFA 20/20, a plan that provides goals and a framework for action, allowing us to be decisive and nimble as we confront our changing business needs. In the process, NAIFA 20/20 will improve our professional-development offerings, strengthen our industry partnerships and increase the public’s awareness of the good that you do for your clients and their families.

To help you run your business more profitably, we are creating new training courses that will sharpen your skills and give you the professional expertise you need to

succeed. We are also developing value-added professional credential programs that will allow you to demonstrate your proficiency and expertise to your clients, colleagues and employers. Our legacy and credibility in the marketplace make us a credible source of unparalleled professional-development programs.

Teaming up for success

On the advocacy front, no organization is better suited than NAIFA to represent the financialservices industry at both the state and federal levels. We are committed, as part of our NAIFA 20/20 transformation, to work hand-in-hand with insurance companies, brokerages and other corporate partners to ensure that we advance the interests of advisors, the industry and consumers nationwide.

No one ever got ahead by standing still. That’s why it is imperative for us to work collaboratively to implement the dynamic change demanded by NAIFA 20/20.

As we look at what NAIFA has accomplished and at what lies ahead, we know that success is not an option—it is an imperative. I hope I can count on your commitment as we enhance NAIFA and make it once again the association of choice for all agents and advisors.

Paul Dougherty, LUTF, FSS, HIA, ALHC, is president of NAIFA. He is with State Farm Insurance Companies in Hyattsville, Maryland. Contact him at paul@doughertyagency.com.

NAIFA OFFICERS

President Paul R. Dougherty, LUTCF, FSS, HIA, ALHC State Farm Insurance Companies paul@doughertyagency.com

President-Elect

Keith Gillies, CFP, CLU, ChFC Ameritas kmgillies@aol.com

Secretary Jill Judd, LUTCF, FSS State Farm Insurance Companies jill.judd.jyt0@statefarm.com

Treasurer Matthew Tassey, CLU, ChFC, LUTCF Burwell & Burwell mtassey@scribnerinsurance.com

Immediate Past President

Jules O. Gaudreau, Jr., ChFC, CIC The Gaudreau Group, Inc. julesgaudreau2@gmail.com CEO Kevin Mayeux, CAE kmayeux@naifa.org

Trustees

David A. Beaty, CLU, ChFC dave@heartlandfinancial.net

Michael O. Brown, LUTCF michaelbrown@financialguide.com

Aprilyn Geissler ageissler@farmersagent.com

Todd G. Grantham, CFP, CLU, ChFC, MSFS todd.grantham@nm.com

Bryon A. Holz, CLU, ChFC, LUTCF, CASL bryon@bryonholz.com

Brock T. Jolly, CFP, CLU, ChFC bjolly@financialguide.com

Booker Joseph, CLU, ChFC, FLMI Bookerjoseph@uhc.com

Delvin Joyce, CLU, ChFC delvin.joyce@prudential.com

Thomas O. Michel tmichel@michelfinancial.com

Charles M. Olson, CLU, ChFC Charles@ociservices.com

Cammie K. Scott, LUTCF, REBC, RHU cscott@ckharp.com

Greg Toscano, LUTCF Johnson Insurance Consultants gttoscano@yahoo.com

NAIFA SERVICE CORPORATION OFFICERS AND DIRECTORS

President

Kevin Mayeux, CAE

Secretary

Paul Dougherty, LUTCF, FSS, HIA, ALHC State Farm Insurance Companies

Treasurer Matthew Tassey, CLU, ChFC, LUTCF Scribner & Scribner

Directors

Brenda Doty, LUTCF, RHU, CLU, CPC The Doty Group, Inc.

Susan Wier, CFP, ChFC, LUTCF

First American Trust

EDITORIAL ADVISORY COUNCIL

Laurie A. Adams, CFP, CLU, LUTCF Country Insurance & Financial Services

Brian Ashe, CLU

Brian Ashe and Associates, Ltd.

Frank Bearden, Ph.D., CLU, ChFC

Frank C. Bearden, Ph.D., Consulting

Kevin Faherty, LUTCF Faherty Insurance Services, Inc.

Greg Gagne, ChFC, LUTCF Affinity Investment Group, LLC

Lisa Horowitz, CLU, ChFC

LifeCycles

Michael Lynch MetLife

John Marshall Lee, CLU, CFP, RHU People Insurance & Investments

John Nichols, MSM, CLU Disability Resource Group Inc.

Ike Trotter, CLU, CASL, ChFC

Ike Trotter Agency, LLC

Tool Makes it Easier for Advisors to Illustrate Retirement Income in Tax-Deferred Accounts

Lincoln Financial Distributors (LFD) announced unique enhancements to its Lincoln Investor Advantage Visualizer—a tool designed to help advisors illustrate the potential benefits of incorporating annuities as part of a client’s comprehensive retirement plan. Powered by investment research firm Morningstar, the interactive and online income-planning tool now includes a dynamic Tax Deferral Illustrator (TDI) designed to demonstrate the long-term impact of investing in a tax-deferred account versus a taxable account.

“With these latest enhancements, our Visualizer technology helps advisors address the impact taxes have on retirement planning and the need for income in retirement— enabling them to tell a more dynamic, compelling story. The end goal is to help clients maximize income and plan for a better future,” said John Kennedy, head of

Retirement Solutions Distribution, Lincoln Financial Distributors. “As technology evolves, we maintain our focus on identifying innovative opportunities like this that expand our product and distribution capabilities—making it easier for advisors to have more meaningful conversations with clients about securing retirement outcomes.”

Through the collaboration with Morningstar, the enhanced Lincoln Investor Advantage Visualizer is fully integrated with i4LIFE, Lincoln’s patented living benefit rider. The tool allows advisors to help clients visualize their potential retirement income with Lincoln Financial Group, giving advisors the ability to quickly illustrate and explain the various options available that can better help clients meet their financial goals.

“We believe our proprietary Wealth Forecasting Engine (WFE) is a sophisticated way to illustrate the power of tax deferral,” stated John

McCarthy, senior product manager at Morningstar. “We’ve created an easy-to-use tool that integrates Lincoln’s i4LIFE ® Advantage living benefit rider, giving advisors a powerful tool to walk their clients through their retirement path.”

For more information, visit www.investoradvantage.com.

New Disability Plan for Entertainers

For more than 35 years, Petersen International Underwriters of Valencia, California, has been in the business of writing high-limit disability insurance for the men and women of the film, television and music industries.

The company is pleased to announce the return of the StarCover disability plan to the American insurance marketplace. The product has had a complete makeover, modernized and refurbished for today’s showbiz clientele. The focus of StarCover is fiduciary security and income protection of the Hollywood elite — the talent in front of the camera and behind the microphone.

The new plan touts a true “own occupation” definition of disability, as well as robust, high-limit monthly and lump sum benefit schedules

According to Jimmy Petersen, marketing director of Petersen International, “What explicitly sets the new StarCover program apart from the rest of the market is its uniquely designed ‘disfigurement rider,’ which provides primary benefits to a client who has become irreparably maimed or scarred due to an accident or sickness, but is still physically able to work and isn’t considered disabled under traditional industry definitions. We strongly believe this new product is the

next generation of disability income protection for the entertainment industry.”

For more information, call 800-345-8816 or email piu@piu.org.

New MetLife Simply SmartSM Bundles Provide Benefits Solutions Tailored to Fit the Needs and Budgets of Small Businesses

MetLife announced the launch of MetLife Simply SmartSM Bundles, which provide brokers and small business owners with employee benefits that enhance their ability to compete in their local markets. Designed specifically for businesses with 10–99 employees, the Bundles include a combination of dental and vision insurance. They will also provide the opportunity to add on an employee-paid group legal services plan to give employees access to a nationwide network of qualified lawyers on a prepaid basis — the first time MetLife is making this benefit available to small businesses.

MetLife Simply Smart Bundles are designed to meet the benefits needs of small businesses in different local markets. Through extensive data mining of dental and vision plans quoted and sold across the country, MetLife created pre-built, tiered plan options to match the coverage and pricing needs of small employers in each geographical area.

“Every local market has factors as unique as its businesses. Drawing on MetLife’s sixty-plus years of experience in small business benefits, our experts have mined local data to craft plans that have the pricing and coverage that small business owners require to be competitive. To help them stabilize their budgets, we lock in pricing for 24 months across products — a twoyear rate guarantee,” said James Reid, executive vice president, regional & small markets at MetLife. “Plus, our tiered local options give them the flexibility to select the right plan with confidence. We like to say they are ‘simple, smart, local,’” he added.

Jessica Moser, vice president, regional & small business strategy at MetLife, said, “We pride ourselves

on putting our customers and small business brokers at the forefront of everything we do. Based on our knowledge of the current and emerging benefits needs of small businesses, we are expanding our offerings — starting with MetLaw, a prepaid legal services plan. It’s the same plan that we have previously only offered to larger employers, but now will be available as an exclusive, voluntary option with MetLife Simply Smart Bundles, with no minimum participation requirements.”

MetLife Simply Smart Bundles include Dental and Vision coverage — among employees’ most-desired and “must have” benefits after health insurance, as reported in the 14th Annual MetLife U.S. Employee Benefit Trends Study. They are easy to set up for both brokers and employers. Online quote submission capabilities for brokers makes it a snap for them to look up the bundle options for

their local market and submit a quote request by providing some basic information online. MetLife also provides, at no additional cost, an interactive decision-making video to help employees make their choices so employers can increase engagement and participation.

MetLaw is exclusively available to groups with 10–99 employees as part of the bundle, and participating employees get convenient, full-service access to local attorneys at a competitive monthly rate. MetLaw is provided by Hyatt Legal Plans, Inc., a MetLife company, and will be available as an optional part of a MetLife Simply Smart Bundle for groups with effective dates of December 1, 2016 or later.

Brokers can see what Bundle options are available in their markets in one step at MetLife.com/ SimplySmartBundles.

MetLife Simply Smart Bundles are designed to meet the benefits needs of small businesses in different local markets.

By Bryce Sanders

I Love My Job, But I Don’t Want to Do it Forever!

Before you make your move, gradually transition your clients to another advisor or they might take their business elsewhere.

Not everyone wants to leave their business feet first, carried out of the office on a stretcher with a phone in their hand. You might want to spend the next stage of your life traveling the world. The practice you have built over the years has value, and you have a responsibility to your clients. So what do you do?

Meanwhile, many clients have their own succession plans. They see themselves as “your clients,” but when you are no longer in the picture, they move to a free-agent status and are ready to take their business elsewhere. Often, they have met another advisor socially and his company is their next port of call.

Here are a few options to consider when thinking of succession planning for your business:

Bring in the next generation. Transition the business to your children. This takes time and often involves addressing commitment and respect issues. For example, your kids just can’t turn up one day and occupy your office. They need to get licensed and learn the business. Others in your office may not take them seriously until they have paid their dues. The major advantage is how your clients see the transition. If they are business owners themselves, handing the business to the next generation probably makes lots of sense.

Take on a partner. This strategy is very similar to selling your book of business. You identify another agent or advisor at your firm whom you think would be a good fit. You complete the paperwork required. Initially, your books are kept separately, but new accounts opened from that point forward go into a Joint Production Number. Gradually, both books are combined. You receive a percentage of the total revenue, and this percentage declines over time as you transition out of the practice. This takes a couple

Business succession occurs over time – fulltime work becomes semiretirement, and eventually semi-retirement evolves into full retirement.

of years. Clients like this approach because you are still in the picture. Form a team. Forming a team is another long-term approach to transitioning out of your business. You bring on a couple of newer agents or advisors who start by focusing on new business development (prospecting). They also work your “B” and “C” books. You teach them the business and your clients gradually become comfortable with working with them. You then gradually make the transition, similar to the partner example described earlier. You are in the role of senior partner, collecting the lion’s share of the revenue. The disadvantage is the initial added cost. You need to pay these junior team members as they come up to speed. Hopefully, their work on prospecting and deepening smaller account relationships pays off.

Promote your sales assistant. In reality, you already have a team. Someone answers your phone when you are busy or visiting clients and prospects. Your clients are very comfortable with that person because he is the first point of contact. Your assistant knows the business and understands the products and services you offer. In reality, he could do your job. So why not give him a chance? This involves making sure he has the

required licenses and transitioning him into an “associate” role. He gradually moves into performing more client-facing activities as the number of hours you spend in the office decreases, and you hire another sales assistant to replace him. This approach has several advantages. Your current assistant is probably great at everything except prospecting, since finding new business is a major part of your job. You also incur additional expenses when you hire a new assistant.

In each of these examples, you ease the transition for your client while continuing to provide great service. Notice that the entire process occurs over time — full-time work becomes semi-retirement, and eventually semi-retirement evolves into full retirement.

You might not consider any of these examples — you might just want to sell your book of business to a stranger, walk away and never look back. But keep in mind that when there’s no effort made at gently transitioning clients to another advisor, the chances of their taking their business elsewhere greatly increase.

Bryce Sanders is president of Perceptive Business Solutions Inc. He provides HNW client acquisition training for the financial services industry. His book, “Captivating the Wealthy Investor,” is available on Amazon.

Building a Practice You Love

The key is to find a product or market you love and work exclusively in it.

What is a better motivator, love or money? Behavioral economists have done countess studies searching for the answer. The romantic in all of us would likely respond “love” if asked in public. In private, it might not be quite as obvious.

Let’s apply the question to your practice. Would you rather build a practice that focuses on activities you love or one that focuses on activities that will make you the most money? Give yourself time to think about the answer.

Financial advisors are generally more concerned about a practice’s financial potential than whether or not they love what they are doing or with whom they are doing it. This is a reasonable, if not imperative, concern if you are a new advisor in survival mode. But at some point, it is important to ask: “Is there more than just survival mode?”

How many times in your career have you been attracted to a speech or an article with a title like “How to Make a Million Dollars Working 3 Months Per Year?” I wonder how many people were actually able to build a practice like that. The challenge is that not all of us are able or willing to do the activities or build the skills required to be a financial success in every practice type. So choosing a practice type just because it can make some people a lot of money may not be the best approach for you.

My initial training came in the general agency of a large, wellrespected insurance company. The training was excellent. They taught me how to survive, which, for a new agent, is critical. I can still hear the trainer saying, “You don’t have to like it; you just have to do it.” To be fair, it did work, but I didn’t enjoy it very much. It wasn’t until I was able to elevate my practice to activities I loved, with people and professions

I loved, that I was able to build a practice that I love.

Many financial advisors are seeking financial success over happiness, which brings us back to the behavioral economists. Money is more attractive than happiness. But love is more motivating than money, and being attracted to success is different from achieving it.

Building a successful business requires actions, not just intentions or feelings. Are you more motivated to do activities that you love, or are you more motivated to do activities that may or may not produce the expected result even if you want the result very badly?

If you are not motivated to take the necessary actions, you won’t do them and you will be less likely to succeed. There is a causal relationship between liking an activity and doing it.

Ultimately, we are more intrinsically motivated by love than by money. So let’s build a practice we love, and in doing so, we will be more likely to also have financial success. Most people think financial success will lead to happiness. I have found it to be just the opposite.

If you love what you do, you will do it more, which will make you better at it, which will lead to more financial

success. If you love what you do, your enthusiasm will be apparent to your clients, and ultimately that will lead to more financial success. Specializing in a specific product, market or clientele that you love will make you very efficient, which will create more time for you, which will also lead to more success. Frankly, even if you aren’t as financially successful as you would like to be, wouldn’t you trade some of the “success” for happiness anyway? More often than not we are using the fruits of our financial success to find happiness. Isn’t that ironic?

The bottom line is that you should find a product, practice type or market that you love, work exclusively in that area, and you will build a practice that you love.

The life insurance practice of Brad Elman, CLU, CLTC focuses on business and estate planning. In 2013, he founded Special Needs Life Insurance Solutions, LLC, dedicated to helping families of children with developmental disabilities plan for their financial security (lifeinsurancespecialneeds.com). He is a 24-year MDRT member, with 14 Court and 1 Top of the Table qualifications. Contact him at 650-209-5754 or at Brad@elmaninsurance.com.

It wasn’t until I was able to elevate my practice to activities I loved, with people and professions I loved, that I was able to build a practice that I love.

The New American Dream

Happiness and security are now valued more considerably than wealth, opportunity and moving up in one’s social class.

The American Dream may be alive and well for many Americans, but their perceptions of it may have changed. According to research released by Northwestern Mutual, two-thirds (66%) of U.S. adults believe they can attain “the American Dream,” and only 16 percent feel it is out of reach.

However, the study revealed some interesting nuances about how perceptions of the American Dream have changed — and not just from one generation to the other. A third (31%) of the Americans who were surveyed said their definition of the American Dream has changed in just the last five years, and more than half (57%) said their view is different from that of their parents.

This is the first set of findings from the 2016 Northwestern Mutual Planning & Progress Study, an annual research project commissioned by Northwestern Mutual that explores Americans’ attitudes and behaviors toward money, financial decision-making and the broader landscape issues impacting people’s long-term financial security. The research was conducted in February of this year by Harris, polling more than 2,000 U.S. adults aged 18 and older.

Happiness takes center stage

In today’s view of the American Dream, happiness and security are valued considerably more than wealth, opportunity and moving up in one’s social class. When asked about the most defining characteristics of the American Dream today, the top two answers were:

• “Having a happy family life” (59%)

• “Being financially secure” (58%) This far outweighed some of the more traditional notions of the

American Dream, such as:

• “Having more opportunities than my parents’ generation” (18%)

• “Having wealth/making a lot of money” (11%)

• “Moving up in social class” (3%) Interestingly, three-quarters of the Americans surveyed (74%) said they would not exchange the lifestyle and financial situation they have today for what their parents had when they were the same age.

“The goal today seems to be more about outcomes — happiness, security and peace of mind rather than material wealth or the opportunity to advance,” said Rebekah Barsch, vice president of planning and sales at Northwestern Mutual. “The white picket fence is still important, but today Americans seem to care more about what’s going on inside the house.”

A sense of financial insecurity

While long-term optimism for the attainability of the American Dream is positive, there is also considerable evidence showing that many people

do not feel financially secure in the present and are not bringing high levels of discipline to their financial planning. The study found:

• Nearly a third of U.S. adults (29%) said they do not feel financially secure.

• Only one in five (21%) Americans consider themselves to be “highly disciplined” financial planners.

• A third (34%) consider themselves “disciplined” planners.

• Another third (33%) consider themselves “informal.”

• More than one in ten (12%) “do not plan at all” and “have not set any financial goals.”

“Financial security has emerged as the very pillar of the American Dream today, and a distinct catalyst toward leading a happy life. But there’s a disconnect between how the relatively small steps of solid planning and strong discipline can lead to big strides toward achieving that American Dream,” said Barsch. “Optimism is great, but it needs to be backed up with consistent action.”

“The white picket fence is still important, but today, Americans seem to care more about what’s going on inside the house.”

Rebekah Barsch, Northwestern Mutual

By Steve Decker

A New View of Retirement

Enrich the lives of your clients who are 55 years old and over by helping them see retirement as a time for recess.

Picture a traditional arc. At one end of the arc is childhood, and at the other end is old age. There are three other milestones along the path of this arc: adolescence, adulthood and retirement. This is the traditional view of life.

childhood. At are and becoming outdated moving a new shoots

childhood. At are and becoming outdated moving a new shoots

Some those the first Recess,” love themselves tennis taken with part-time let time

Some those the first Recess,” love themselves tennis taken with part-time let time

But since I became a financial advisor, I have witnessed that this theory is outdated and just not true. This is my view: The arc is not an arc. Instead, it’s a fluidly moving line that takes you from childhood, adolescence, adulthood, and to a new life stage right before retirement and old age.

I like to call this life stage “Ready for Recess” because it’s a permission slip for retirees to do what they really love and want to do.

once a person retires. Some people call retirement a second chance or a second act to life. To me, those sound like “do overs,” or that the person got something wrong the first time through.

Ready for

recess

When you view this line, you’ll notice that it dramatically shoots up. Why? Because life is hardly over

I like to call this new life stage “Ready for Recess” because it’s a permission slip for retirees to do what they really love and want to do. I believe that people over the age of 55 have a wonderful opportunity to create new things — art, ceramics, music, a new business perhaps — and discover more about themselves as well as what life has to offer.

I’ve had clients who have become professional table tennis champions

at the age of 70! Other people I know have taken on volunteer assignments at hospitals and read to or visit people who don’t get many visitors. Some have found part-time work at a national park like Yellowstone. I praise these individuals for teaching all of us a valuable lesson: Don’t let others determine your destiny.

We all remember what recess was like as a kid. Isn’t it time we think of the life stage before retirement as recess? Certainly! Life is not about slowing down in today’s age. As a matter of fact, it can mark a new beginning.

Steve Decker is the owner of Decker Financial Group in Perrysburg, Ohio. Contact him at 419-475-9393.

By James Mahaney,

College Funding: Helping Clients Evaluate What’s Best

Start by helping them navigate how to select and pay for the “right” college for their children.

Parents only want the best for their children. This is especially true when it comes to college. However, there may be different ways to think about what’s “best,” particularly in the face of dramatically rising student debt levels in America and the impact that can have on retirement security. Your clients may look to you, as a financial professional, for help. The following outlines some things to consider.

The average amount of student loan debt for borrowers at every age has more than doubled between 2003 and 2015. This means that it’s not just students who are borrowing much more — parents are, too.1

How Families Pay for College Today

Your clients must balance their emotions against the risk of taking on a level of debt that may burden their children, and possibly themselves, for years to come.

a level that captures the maximum amount their employer will match.

The typical family today relies on a web of resources to pay for college. Fifteen percent of the cost is funded by student borrowing, 7 percent by parent borrowing, 12 percent from student income and savings, 30 percent from parent income and savings, 31 percent by grants and scholarships, and 4 percent from contributions from other relatives.24

Qualifying

The effect of higher borrowing is emerging as a concern among economists, policymakers, employers and retirement experts. Young consumers already carrying student loans may not be willing to take on debt to buy a house or a car. If they are willing, they might not qualify. 2

Research conducted by the Center for Retirement Research at Boston College (CRR) and sponsored by Prudential indicates that student loan debt may jeopardize one’s golden years if it impacts the ability to save adequately for retirement.3 The CRR found that 49 percent of households without student debt were at risk of not being able to maintain their standard of living in retirement; that percentage soared to 60 percent for households with student debt.4

How Families Pay for College Today

Prestige versus cost

The typical family today relies on a web of resources to pay for college. Fifteen percent of the cost is funded by student borrowing, 7 percent by parent borrowing, 12 percent from student income and savings, 30 percent from parent income and savings, 31 percent by grants and scholarships, and 4 percent from contributions from other relatives.24

What’s more, when it comes to retirement, 401(k) plans have replaced traditional pensions as the predominant workplace retirement plan. For 401(k) plans to work effectively, individuals must save an appropriate amount, especially at

So, what’s “best” when it comes to a child’s college education? There is more than one way to look at it. Attending what is considered a more prestigious college has often been viewed as the best option for a child, even though the associated cost may be higher.

Another school of thought is that it may not be best for a child to choose a college that requires

In 31 percent of families, the student provides all funds not covered by financial aid.25 In another 31 percent of families,

significant student loans if those loans hinder the long-term financial prospects of the child (or parents) after graduation. This can be a difficult challenge for parents, as tackling this issue with a high-school student is not an easy task. Emotions can run high. Their children have worked hard, both in and out of the classroom. What’s more, in an era of social media, they face much greater social pressures when selecting a college than their parents did.

As on loans, one qualifies the highlights is many Institutional schools financial

BorrowingIncome and

Qualifying for Need-Based Aid: The Federal Methodology and FAFSA

Your clients, as parents, may feel similar social pressure — in addition to self-imposed pressure — and must balance these emotions against the risk of taking on a level of debt that may burden their children, and possibly themselves, for years to come.

Understanding options

In 31 percent of families, the student provides all funds not covered by financial aid.25 In another 31 percent of families, parents pay enough of the costs such that the student pays nothing, either out-ofpocket or borrowed.26

There is no doubt about the value of a college education. College graduates, on average, earn 65 percent more than their counterparts without college educations.5 However, careful consideration must be given to how

As noted earlier, need-based financial aid is awarded based on a family’s income and assets. It takes the form of grants, loans, and work-study programs. Colleges typically employ one of two methodologies for calculating whether a student qualifies for need-based aid: the Federal Methodology or the Institutional Methodology. This section of the paper highlights the workings of the Federal Methodology, which is used by the federal government, all public colleges, and many private colleges. The next section is devoted to the Institutional Methodology, which is used by some private schools to determine eligibility for non-governmental financial aid.

The FAFSA

Qualifying for financial aid under the Federal Methodology always begins with completing and filing the FAFSA—the Free Application for Federal Student Aid. The form requires financial information from both the student and at least one custodial parent, and must be filed for each year the student will be attending college. While awaiting the results of their FAFSA filing, students can get an early estimate of how much federal aid they may qualify for by completing another online form, the FAFSA4Caster, at the website of the U.S. Department of Education’s Office of Federal Student Aid.27

Family

Families should file the FAFSA as soon as possible after January 1 of the year in which the student will enroll in college, since some colleges award aid on a first-come, firstserved basis—and because missing the final deadline, which

The Qualifying always Free financial custodial will FAFSA much online Department Families January college, served is to this February some taken prior completed government their their Data

The complete custodial Number, electronic are custodial

Source: The Prudential Insurance Company of America

How Families Pay for College Today

PRACTICE SPECIALTIES College Funding: Helping Clients Evaluate What’s Best

much is being borrowed to pay for a college education.

While saving for college in tax-advantaged vehicles such as 529 plans and Coverdell Education Savings Accounts is important, so is being educated on how financial aid is awarded. Perhaps surprisingly, schools can vary greatly as to how much “non-loan” aid is offered to a prospective applicant.

The good news is that information is now available in the form of publications, websites and online calculators to help families become educated on the nuances of how financial aid is awarded by different schools. These tools can help families minimize the need for excessive loans.

As parents, your clients must look out for the well-being of their

children, not only in the short run, but in the long run as well. Your clients may look to you as a resource when navigating these issues. Before their college search process gets too far along, recommend they follow three simple steps.

First, they must recognize that the “best” college choice for a child may mean more than just attending the most prestigious school at which he or she was accepted. Second, they should hit the books to understand how various college options can be financed without impacting their own retirement plans. Finally, if needed, they should be courageous and have what may prove to be difficult conversations with their children.

James (Jim) Mahaney, CLU, CFC, is a vice president with the Strategic Initiatives

Unit of Prudential, where he has recently authored retirement-related research papers on Social Security, financial planning for same-sex couples, and college debt. Mahaney holds a Bachelor’s degree from Denison University and Masters of Science degrees in Financial Services and in Management from The American College.

Endnotes:

1. The Federal Reserve Bank of New York, “The Graying of American Debt”, February, 2016, http:// libertystreeteconomics.newyorkfed.org/2016/02/ the-graying-of-american-debt.html#.Vt7missUXcs

2. Ibid.

3. The Center for Retirement Research at Boston College, “Will the Explosion of Student Debt Widen the Retirement Security Gap?” February, 2016.

4. Ibid.

5. U.S. Bureau of Labor Statistics, http://data.bls.gov/ cgi-bin/print.pl/emp/ep_table_001.htm

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Portfolio Allocations for New Market Conditions

The use of alternative strategies can help investors ride the wave and minimize losses in the long term.

We’re in the midst of a stock market plagued by uncertainty. Global economic ties are more fragile than ever, manipulated global interest rates have dimmed yields, and a once seven-year charging bull market has slowed to a crawl since the ring of the New Year.

Investors with traditional asset-allocation models of long-only stocks and bonds are no longer adequately positioned for risks and opportunities. The traditional 60/40 (60 percent in equities, 40 percent in bonds) may not be so steadfast today, but it remains rooted in the time-old premise: Equities drive growth, and bonds (or similar assets) provide more consistent, risk-averse returns.

The business case for shifting portfolio allocation

But in the current landscape — where interest rates are very low and the equity market is experiencing high volatility — neither of those approaches work. Instead, a small fundamental shift in portfolio allocation can provide security when volatility is high. Allocating 20 percent of a portfolio to alternatives,

Allocating a portion to alternatives will stabilize high volatility.

with the remaining 50 in equities and 30 in bonds, provides a buoy for the overall portfolio.

This allocation model has historically demonstrated stronger performance during periods of significant stock-market declines, compared to the traditional 60/40. There are a few reasons for this.

First, a weight in alternative strategies exposes a portfolio to assets uncorrelated to the equity and bond markets. Where the traditional allocation utilizes stocks and bonds as each other’s safeguard, a 20-percent allocation to alternatives alleviates that strong dependency.

Because of the non-traditional investments that these alternative strategies employ, investors have the potential to generate new and uncorrelated sources of returns. This is perhaps most important in today’s market, where traditional sources of alpha are minimized. With so much uncertainty, fundamental analysis can be less reliable. Alternative

strategies often generate returns from unique sources, allowing investors to circumvent the sometimes unreliability of traditional analysis.

Second, alternatives have delivered higher returns than stocks and bonds, with less than half of the volatility of stocks over the last 20 years. Figure 1 and Figure 2 detail these data. Reducing volatility exposure can prove particularly beneficial in the current market landscape.

Where bonds were once a steadfast resource of low volatility, the manipulation of global interest rates has severely diminished this asset’s reliability. Allocating a portion to alternatives will stabilize high volatility, particularly those strategies that each seek to offer uncorrelated streams of returns and diversified risk exposures.

Using alternative strategies

Alternative strategies tend to be perceived as complicated in nature, deterring some investors from diving head first into this sector. But even incremental investments in this sector can still prove beneficial. A five percent portfolio allocation to alternatives would have historically resulted in a portfolio with higher annualized returns and lower

volatility, as Figure 3 displays. For investors hesitant to allocate a larger portion of their investments in this sector, an allocation as small as five percent would have historically proved a beneficial investment.

Market volatility shows no signs of easing, and investors must prepare their portfolios accordingly. In current market conditions, relying on equities and bonds alone can prove detrimental. In allocating a portion of a portfolio to alternative strategies, uncorrelated to traditional markets, investors can better position themselves to ride the wave and minimize losses in the long term.

David Miller is chief investment officer and senior portfolio manager at Catalyst Funds.

Investors with traditional asset allocation models of longonly stocks and bonds are no longer adequately positioned for risks and opportunities. Licensing made simple: Easy access Single payment Multi-state

By Robert Faingold

Leveraging the Power of Study Groups

Here is how to get the most from study groups, which can help advisors take their practices to the next level of success.

Study groups are an effective means for peer members to share best practices while providing support and encouragement to each other on their path to personal and professional development. By leveraging the power of study groups, establishing goals and holding each member accountable to reaching those goals, there is a capacity for growth that surpasses what one can accomplish on his or her own.

Being a part of a successful study group is not without costs, however. Members must be willing and able to commit the necessary time and monetary resources — time to prepare for and attend meetings and funds for travel and group activities. Members must also be willing to be open and honest in their communications with one another, while being totally present and engaged at every meeting.

Setting up a study group

Study groups are generally established to support agents at various levels of their careers. Often, a study group will start with an initial group of six or so members who set the operating principles for that group, including logistics, finances, requirements for joining the group, the group’s structure, how often the group will meet and more. Written formal bylaws provide structure and help ensure that members stay true to the group’s original intent. Bylaws also provide a clear outline of members’ responsibilities and obligations and serve as a guideline for recruiting new members. They should cover the group’s mission/objectives, meeting guidelines, membership requirements, expenses, attendance, nominating process and program outlines.

Ameritas Growth Leaders

In 2013, Ameritas formed the Ameritas Growth Leaders (AGL) study group

for agents with fewer than 10 years in the business who qualify for our annual Sales Leaders Conference. Since our business can be very challenging, especially for newer associates, the AGL is a way for Ameritas to show our support and dedication to these associates.

This “super study group” was formed with three primary goals:

1. To create a platform for developmental education for producers who are newer to the financial-services industry.

2. To act as a social platform to help establish a stronger connection with high-level newer producers.

3. To help develop newer producers become the next level of field leadership for the upcoming years within their agencies, the industry, the Field Advisory Cabinet (FAC) and other committee involvement.

The field-led meetings center on topics and issues that help newer agents survive and thrive in our business. Meetings include interactive discussions about sales concepts, best practices, client acquisition, hiring staff, getting to the next production level and more. Open dialogue sessions, led by some of our top sales leaders, reinforce

the value of study groups while also sharing techniques and concepts to help achieve success.

Keith Gillies, CFP, CLU, ChFC, with United Wealth Advisors Group–La Place, is one of our top sales leaders. He has been actively involved since the AGL’s inception and continues in the ongoing development of the group. He notes, “The decision to invest in our future leaders is an excellent business decision. The process of inquiring how we can assist our Growth Leaders, and matching each of them with our most successful field associates as mentors, provides every opportunity for their success. If they are successful, the company is successful.”

It doesn’t take long to reap the rewards of joining a study group. As Mike Polin with Premier Planning Group says, “At the first meeting alone, we heard fresh prospecting ideas, as well as a great sales concept that lead to new life cases and variable universal life sales.”

Robert Faingold is the vice president of Agency Development at Ameritas. Contact him at 513-674-6304 or email him at rfaingold@ameritas.com.

Open dialogue sessions, led by some of our top sales leaders, reinforce the value of study groups while sharing techniques and concepts to help achieve success.

Call for Excellence

The John Newton Russell Legacy

Outstanding Character, Dedication to the Profession, Meritorious Service

Do you know anyone who possesses these outstanding qualities? If you do, now is the time to submit his or her name for the John Newton Russell Memorial Award. This is the industry’s highest honor.

In 1945, John Henry Russell provided the original endowment to establish this prestigious award to honor his father, John Newton Russell. A staunch proponent of informed, ethical marketing practices, Russell was agency manager for Pacific Mutual. He served as president of NALU (now NAIFA) during World War I and was one of the incorporators of The American College of Life Underwriters. His high standards are perpetuated in this award, which seeks to recognize someone with outstanding personal qualities, unstinting loyalty to the business and exemplary leadership.

Eligibility requirements

The award program is open to anyone you believe is highly qualified, and exhibits the character, leadership qualities, contributions to the profession and American families exemplified by John Newton Russell. Any member of a NAIFA local association is eligible to

nominate a worthy candidate. Nominees must be insurance and/or financial-services professionals. Standards for consideration are extraordinarily high. The characteristics of past recipients have included unwavering loyalty and a high level of professional accomplishment and community service.

How to apply

When you send in your nomination, provide the award selection committee with sufficient information about your nominee and explain the basis for putting forward the person you chose. Nominations will be accepted through February 6, 2017. Your nomination contains the only information the selection committee will have as a basis for their decision, so please be thorough in your description.

The 2017 recipient will be announced in early May and will be honored at the NAIFA Performance + Purpose Conference in Orlando, Florida in September 2017.

Follow the instructions of the application form on the next page and submit it by the deadline indicated. Membership in your local association is required for participation in the award program.

The 2017 John Newton Russell Memorial Award Selection Committee

John F. Nichols, MSM, CLU Chair

Peter C. Browne, LUTCF

2015 John Newton Russell Honoree

Sy Sternberg, CLU

2014 John Newton Russell Honoree

Jules O. Gaudreau, Jr., ChFC, CIC Immediate Past President, NAIFA

Juli Y. McNeely, LUTCF, CFP, CLU Second Past President, NAIFA

Chris M. Foster, CLU, CHFC, CFBS, AEP AALU Liaison

Gov. Dirk A. Kempthorne ACLI Liaison

Robert R. Johnson, Ph.D, CFA, CAIA

The American College Liaison

Cliff Wilson, CLU, ChFC, CLF, LUTCF LIFE Liaison

Anthony R. Bartlett, ChFC, CASL, AEP SFSP Liaison

Mark Hanna, CLU, ChFC MDRT Liaison

Robert A. Kerzner, CLU, ChFC LIMRA Liaison

Kevin M. Mayeux, Esq., CAE, CRMA Secretary

Recommendation

for the 2017 JOHN NEWTON RUSSELL MEMORIAL AWARD

Recommendation

In my opinion, the following living person has rendered service to the institution of life insurance which, viewed in retrospect, is so outstanding and beyond the call of duty as to merit consideration for the John Newton Russell Memorial Award.

Name Volunteer position

Address

Phone number and email

Supporting Data

On a separate sheet of paper, in 500 to 800 words, give a biographical sketch of your candidate, listing the individual’s industry and civic accomplishments and honors received. Please indicate the specific accomplishments that, in your opinion, demonstrate that your nominee deserves the award.

Nominator

Volunteer position

Address

Phone number and email

Mail this form to: John Newton Russell Award Committee

c/o Executive Office

National Association of Insurance and Financial Advisors

2901 Telestar Court

Falls Church, VA 22042-1205

Supporting data must accompany the nomination. Deadline: Feb. 6, 2017.

MassMutual Introduces New CI Coverages

Massachusetts Mutual Life Insurance Co. (MassMutual) is introducing new insurance coverages to help working Americans protect their finances and savings against critical illnesses and accidents. The critical illness and accident group insurance policies are available through employers, either directly or through MassMutual’s BeneClick!SM integrated benefits exchange. The coverage is voluntary, which means that employees pay the full cost of the coverage offered through their workplace, or it can be made available on an employer-paid basis. The policies cover employees and, where available, spouses and children as well.

MassMutual’s introduction of these policies comes at a time when critical illness (CI) insurance is becoming more popular in the U.S.

Advisor Today recently interviewed James Ocampo, assistant vice president, BeneClick!, to learn more about this product and what is fueling its growth.

Advisor Today: What is the size of the CI insurance market in the United States?

James Ocampo: In 2015, CI insurance sales totaled $490.59 million. The product has demonstrated double-digit growth for each of the past five years. The year 2015 was the largest year for sales and saw the largest, year-over-year increase (a 25 percent increase from that of 2014).

Market penetration in the U.S. is relatively low. Only 26 percent of employers in the U.S. offer CI insurance. Since 74 percent of all employers in the U.S. do not offer CI insurance to their employees, the available market for this product is largely untapped.

AT: After a slow start, CI insurance appears to be growing rapidly. What is driving this growth?

Ocampo: CI insurance is growing in popularity as more employers recognize that their employees need to improve their financial wellness. MassMutual’s 2015 Employee Benefits Security Study found that 40 percent of working Americans say personal financial issues distract them at work. CI insurance provides cash when many people need it the most — when they are fighting a covered critical illness such as cancer, a heart attack or another serious illness.

Growth is also driven by two primary factors that are driving a huge portion of the medical and group-benefits market:

1. Healthcare reform and the policy around medical loss ratios have cut medical producers’ compensation by 50–70 percent, causing producers to work two to

three times as hard as they used to for the same revenue.

2. The continued rise in medical insurance premiums has forced most employers to move to highdeductible plans, which exposes employees to more financial uncertainty.

The result is greater interest from medical insurance producers to offer voluntary solutions to offset their revenue loss and provide employers with creative alternatives to offset their employees’ exposure to high-deductible plans. CI insurance has been the best answer to both of these challenges. In response, sales of HSA-compliant CI insurance plans have increased each year since 2011 and are on pace to break another record in 2016.

(Note: MM’s critical illness product is fully HSA Compliant.)

Sales of HSA-compliant CI insurance plans have increased each year since 2011 and are on pace to break another record in 2016.

AT: How does CI insurance fit into a consumer’s overall retirement planning?

Ocampo: On the surface, most people seemingly have their financial houses in order. Our research finds that 77 percent make it a priority to understand their personal finances and benefits. Yet, 38 percent of working Americans say they know little or nothing about their employer-provided benefits, such as healthcare, life insurance, 401(k) retirement plans and other benefits.

At MassMutual, we believe that in the age of benefits consumerism, employees need simple solutions to make sense of all their employersponsored benefits so that they can focus their attention on taking care of themselves and their families now and in the future. Our tools engage people, help them make better choices and incite them to action.

Approximately half of all Americans have little or no savings. CI insurance provides financial liquidity at a time when many people are faced with a large financial burden and when they are fighting an expensive critical illness. Having a source of cash from a critical illness policy can dissuade retirement savers from taking a hardship loan or withdrawal from their 401(k) or other retirement savings.

CI insurance is a lump-sum benefit paid upon diagnosis of a critical illness. What makes CI insurance unique is that the insured

is entitled to the benefit regardless of treatment, as well as to out-of-pocket expenses. This benefit provides the insured and the insured’s family with the freedom to make treatment decisions (type of treatment or no treatment)without having to worry about the financial burden.

AT: Who are the best prospects for CI insurance?

Ocampo: Working Americans who want to protect their family finances, including retirement savings, are a good prospect for CI insurance. Considering that many employers now offer healthcare coverage with high deductibles, having another source of cash to help defray the cost of a critical illness can benefit many people.

Other good prospects are employer groups with 100 or more employees. Cancer, heart attack and strokes are catastrophic illnesses that affect people in all walks of life and in all regions of the country. CI insurance resonates with all levels of employees — from the entry-level employee to those in the board room — regardless of gender.

AT: How do you approach clients about CI insurance?

Ocampo: The most effective way to introduce CI insurance to an employer is to listen to the employer’s challenges and concerns. Every employer that is struggling with the cost of medical insurance and worried about transferring too much cost to its employees has a legitimate need for CI insurance.

AT: What are the most effective strategies you have used to address common objections to critical illness insurance?

Ocampo: Objection: “We already offer medical insurance.”

Addressing this objection: The average out-of-pocket expense for cancer is $750 per month with medical insurance.

Objection: “We are a healthy group.”

Addressing this objection: Have the employer ask the employees to stand, and have each person who has had cancer or knows anyone who has had cancer sit down. Then, ask the same question for heart attack and stroke. Nearly everyone, with the exception of one or two employees, will be sitting down. This demonstrates the need very effectively.

AT: What three things should govern an advisor’s thinking as he attempts to sell CI insurance to his prospects and clients?

Ocampo:

1. Am I helping the employer save on the cost of medical insurance while adding protection against life’s unforeseen events for the employees?

2. What is the best benefitscommunication strategy to educate employees about the value of CI insurance and other voluntary insurance products from both the health and the financial perspective?

3. Which carrier will provide me with the best tools and support to ensure that my employer groups are enrolled and serviced with the same care I give to them?

By Deb Newman,

In Selling LTCI, Start with “Why”

Clients do business with you because of why you do what you do as an agent.

Long-term-care planning has been my sole focus for 26 years. After almost three decades focused on this one thing, I was asked how I remain so passionate about what I do each day. Frankly, at first, I had a hard time articulating my answer.

Some of you have heard of Simon Sinek. He has the third most popular TED Talk of all time, with almost 27 million views. (See the video online at http://ow.ly/nKe8300iU6t.) Sinek has written a New York Times bestseller, “Start with Why.” His core message is that people don’t work with you because of what you do. They don’t do business with you because of how you do it. They do business with you because of why you do it. The “why” engages us emotionally, while the “what” and “how” serve as evidence of the belief. While other companies can copy what you do or how you do it, they cannot be the same if they don’t start with the same “why.”

I’ve seen Simon’s TED Talk numerous times, I’ve read his book in a study group, and I got to speak with Simon after one of his sold-out presentations. I was anxious to share with him what I thought was my “why.” He, however, wasn’t satisfied with my answer and continued to pressure me by asking, “What is your real why?”

I didn’t have an answer for him, which was devastating to me. Later that year, after reading his book in a study group, one of my good friends said, “Deb, I know what your WHY is. You talk about it all the time!” It was crystal clear to her because it seeps through in everything I say. “I do what I do because of the impact that long-term care can have on the caregivers in our lives.”

Here’s why that’s important to me: There will be fewer future caregivers. According to a recent AARP study, we will each have

When we have conversations with clients today, why don’t we have a discussion about giving each other permission?

fewer potential caregivers. In 2010, there were seven potential caregivers for every person over age 80. Let’s be clear. That’s not saying they are willing caregivers, but potential caregivers. By 2030, that ratio is projected to be 4 to 1, and in 2050, it will be 3 to 1.

Another AARP report claims that today, unpaid family caregiving is worth $470 billion annually. With fewer possible caregivers, where are the resources going to come from to help families with long-term care?

It’s not about the care recipient; it’s about the family members. Almost everyone has someone who will care for them. But the physical, financial and emotional impacts of caregiving take a devastating toll on the caregivers. Most of us know a caregiver who has worn herself down trying to care for a loved one. Here’s what it does to people:

• Caregivers are two times more likely to develop chronic illness.

• Caregivers 65+ who have chronic illness histories have a mortality rate that is 63 percent higher than non-caregivers.

• The stress of family care responsibilities has been shown to adversely impact a caregiver’s immune system up to three years after such care ends.

• Stress of caregiving decreases life expectancy by up to 10 years.

The unseen caregiving

Ken and Betsy purchased long-termcare insurance (LTCI) years ago. I visited them to discuss whether it was time to evaluate an assisted-living setting. When I arrived, Ken was sitting at his desk, and I noticed a

walker next to his chair. I reviewed the six activities of daily living and asked if he needed help with any of them. Betsy, with tears in her eyes, said, “I help him with five of those.”

I asked how they were getting up and down the winding staircase in the living room. Betsy told me that after she gets Ken ready in the morning, he goes down the stairs step by step in front of her with his walker, while she holds on to his belt. I called a care coordinator to visit them. When one of the nurses was interviewing Ken on the deck, he said, “We’re fine. Betsy does everything.” A second nurse was in the kitchen with Betsy, who was in tears and finally able to tell someone what was going on. They set up a care plan immediately. Ken had not realized the level of care he was receiving and what the physical and emotional stress was doing to his lifelong companion and best friend, Betsy.

Unseen mental and emotional tolls on caregivers

Studies show that up to 70 percent of family caregivers have significant symptoms of depression. The stress on unpaid caregivers has become so prevalent that there is now actually a Medicare classification for caregiver stress. Is this what we want to do to the people we love the most? We are killing the caregivers!

Permission to hire a caregiver

When we have conversations with clients today, why don’t we have a discussion about giving each other permission? After sharing

a story like Ken and Betsy’s, ask your clients to give each other permission to hire a caregiver when the time comes rather than taking on the burden personally.

Even clients with significant wealth feel the guilt of personal caregiving; therefore, they do not use their own checkbook to pay for care. If they have an LTCI policy, it makes the decision easy, and they can refer to the discussion about permission and hire someone to help.

As the financial and insurance professionals in our clients’ lives, it is our duty to have these conversations early to assist in creating a plan that will help alleviate some of the burdens of family caregivers. No matter what your solution — traditional LTCI, asset-based LTCI, LTCI riders or

The Golden Circle

WHY HOW WHAT

investments — you need to help families plan for this. You don’t want people to think your “why” is “Why didn’t you help us prepare for this?”

Simon Sinek’s www.startwithwhy.com

Deb Newman, CLU, ChFC, LTCP, is the founder and CEO of Newman Long Term Care, a brokerage focused solely on LTC solutions for 26 years. Contact her at DebN@NewmanLTC.com.

By Brian Harrington

Best Practices for Selling Group LTCI

Help your clients execute a successful enrollment by encouraging them to emphasize the value of buying LTCI at the workplace.

By offering group long-term-care insurance (LTCI) benefits, employers have a unique opportunity to give their employees the tools to manage through potentially life-altering, long-termcare events. Brokers are in a unique position to advise their clients on how to conduct a successful enrollment.

Chances are good that long-term care will touch most Americans either as care recipients or caregivers, but long-term-care services can be expensive and, contrary to belief, are generally not covered by health insurance or Medicare.

According to Genworth’s 2016 annual Cost of Care Study, the cost of long-term care continues to rise across most care settings year over year, especially for services in the home, where most people receive care. Nationally, the median monthly cost for the services of an in-home health aide for 44 hours is $3,861. The national median monthly cost of a private nursing home room is $7,698; assisted living, $3,628 per month; and adult day services, $1,473 per month.

Group LTCI can help provide LTC protection for employees as well their immediate families. It can go a long way to help ease the emotional, physical and financial burden of caregiving on employees, as well as the potential financial impact on employers.

According to the 2015 report “Caregiving the U.S.,” six in 10 caregivers reported being employed at some point in the previous year while caregiving. Twenty-five percent were millennials, and half were under the age of 50. Among them, 56 percent worked full time.

The best enrollment results have been achieved when an employer makes full use of marketing resources, branded with the employer’s logo.

Why should employers care?

When employees are trying to juggle the demands of caregiving — often caring for children and parents at the same time — productivity and morale can suffer.

Perhaps the best news of all is that employees prefer to purchase LTCI through their employer.

According to our own internal consumer research, three out of four consumers said they would prefer to buy LTCI through their employer. The primary reasons they cited? The insurance had already been vetted by their employer, and

it could be obtained by the employee through a simplified underwriting and application process.

Best practices for successful enrollment

Brokers can help their clients execute a successful enrollment by encouraging them to emphasize the value of buying LTCI at the workplace. These include:

• Full portability – In our internal consumer research, consumers viewed being able to take the coverage with them when they change jobs or retire as the most attractive feature of group LTCI.

T hree out of four consumers said they would prefer to buy LTCI through their employer. The primary reasons they cited? The insurance had already been vetted by their employer, and it could be obtained by the employee through a simplified underwriting and application process.

• Fewer underwriting requirements

– Because group LTCI is, in part, underwritten at the group level, fewer underwriting requirements are needed at the individual level for employees during initial enrollment.

• Online enrollment – Consumers we surveyed liked the idea of being able to learn more about LTCI, estimate costs and apply online.

• Family coverage – While underwriting requirements are generally more stringent for relatives of employees, spouses, parents, grandparents and adult children may also be able to take advantage of the group pricing, even if the employee chooses not to enroll.

• Easier payment options – Employees can pay premiums by payroll deduction, if offered by the employer, electronic funds transfer or direct bill.

• Affordability – In most employer group plan designs, employees can start small, buy a modest amount of LTCI and then add to their coverage over time as their budgets permit. In our experience, the best enrollment results have been achieved when an employer makes full use of marketing resources, branded with the employer’s logo, such as internal announcements, newsletters, webinars, onsite informational meetings and reminder emails. Many carriers also offer customized employer websites, which can be great sources of valuable information for employees.

Benefits for all Group LTCI is often a direct sale between the insurer and the insured, often through an enrollment website. For brokers, this means they can concentrate on helping the employer build benefit plans that are valued by employees instead of gathering applications for one specific plan. Since brokers are not involved in taking individual applications, as they are with individual or “list bill” individual plans, broker resource requirements for training, licensing and travel are minimized. This is a special advantage for brokers with large employer groups that span multiple states.

An advantage to the employer is that they can offer one plan that employees can then customize no matter where they are located as opposed to constantly having to adapt their benefit plans to new products being introduced state by state throughout the program.

Most important, employees benefit by being able to easily purchase LTCI, vetted by their trusted employer, which will be there for them when they or their families need it the most.

Brian Harrington serves in a dual role as leader of Genworth’s Group Long Term Care insurance business and distribution leader for Genworth’s U.S. Life Insurance division.

From Yes to Success

Here are six ways to make your next IDI application sail through underwriting.

You got your client to say yes. One of the hardest parts of sales may seem to be helping your clients understand the need for income protection. But once you’ve gotten that client signature and the application is submitted, you’re in the clear, right? Not quite.

From initially approaching a client about the need to protect his income, to working with your General Agent to find the right carrier and submitting an application, you’ve invested a good deal of time in making the sale. However, while most of the hard work has been done, the sale is not complete.

That’s because the next step for an IDI sale is underwriting. An IDI application requires underwriters to review a significant amount of documentation, such as medical history and financial statements, before an application is approved.

One of the questions I’m most often asked by producers is how they can help ensure their client’s application is wellreceived by a carrier’s underwriters. Each time I’m asked this question, my response is that optimal IDI underwriting requires two things: preparation and setting expectations for a client.

Whether you write one IDI policy a year or are a genuine IDI expert, here are a few tips that may help improve your experience.

Tip 1: Partner with a trusted resource. Working with a General Agent can help as you navigate the sales process and position yourself as an expert to your client. These experienced, knowledgeable specialists have a deep understanding of IDI products and have numerous insights from years of working with different carriers. Also, they can help you with everything from sales logistics, such as how to prepare to sell the product and how to navigate the sales and underwriting processes, to how to manage client expectations throughout the underwriting process.

Tip 2: Prepare a client to submit personal information. An IDI application can get detailed. One of the most important aspects to discuss with a client is the amount of personal information, including medical history and tests, financial statements and occupational history that will be needed for a carrier to analyze his or her application. While most of this information is requested up front, additional documentation could be needed throughout the process, so make sure to prepare a client by letting him know that other information could be requested after his application is submitted.

Tip 3: Understand that IDI underwriting may be different from what you’re used to. Some producers assume that the underwriting process for IDI is similar to that of other products, such as life insurance. However, IDI applications are viewed under a more detailed underwriting process, as a different type of risk is being assessed.

To assess a client’s insurability for IDI, a carrier doesn’t just need detailed medical history; it also needs a clear picture of your client’s financial and occupational history. That’s because, while life insurance underwriters are looking for conditions or activities that may increase the risk of a client’s death, IDI underwriters are investigating a person’s risk of becoming disabled. And since the chance of becoming disabled before age 65 is greater, and the policies could potentially pay out large benefit amounts over a long period, it’s important that the carrier does its due diligence to ensure that your client’s application has been thoroughly analyzed.

Tip 4: Just because you’ve taken an application doesn’t mean you can move on. IDI isn’t a “submit and forget” type of sale. A number of IDI policies aren’t issued as applied for, as clients may have injuries or medical conditions that could prevent them from receiving full coverage. This type

Optimal IDI underwriting requires preparation and setting expectations for your client.

of approval is known as a modified offer, and it doesn’t mean that your client received suboptimal coverage. It just means that there are limitations for what is covered by the policy.

If an application comes back with a modified offer, it’s important that you’ve made your client aware of the possibility so he isn’t taken by surprise if this happens. This is an area in which your General Agent can be a lot of help, and she should have tips on how you can approach this subject.

Tip 5: Present documentation up front. As mentioned previously, there is a lot of information that a carrier needs to analyze with a client’s IDI application. To help, many carriers have a list of the information that should be included with an application. While it may feel like a laundry list of information, submitting

new products cont’d

all the documentation in a timely manner is crucial to ensure a policy is approved, and it eliminates back and forth between you, your client and the underwriting team. Your General Agent often can help with ways to streamline this process and make sure you are getting the right information from your client up front.

Tip 6: Write a cover letter. Submitting a cover letter with your client’s application is a great way to provide the carrier’s underwriters with an overview of your client and provide information that may not be gleaned from the application. The cover letter should provide context around his or her occupational duties and employment as well as medical and financial history. Including a cover letter with an application helps underwriters have a better

understanding of the applicant’s history and potentially reduce the number of questions, which can lead to a quicker and more efficient underwriting process.

Above all, it’s important to work with an IDI carrier that helps evaluate every applicant to provide the best possible offer. While the underwriting process may seem extensive, the process hopes to ensure that your client has the best coverage at the best price to help protect him if an unforeseen illness or injury arises.

Sue Schweitzer, senior director of Individual Disability Insurance underwriting at Standard Insurance Company, leads IDI underwriting operations, including distribution system support and case management for fully underwritten businesses.

Penn Mutual and Vantis Life Insurance Companies to Combine

The Penn Mutual Life Insurance Company (Penn Mutual) has entered into a definitive agreement to merge with Connecticutbased Vantis Life Insurance Company (Vantis Life), a deal which will expand Penn Mutual’s presence in the life insurance industry by leveraging Vantis Life’s bank-focused distribution model. As a result of this deal, Vantis Life will become a wholly-owned affiliate of Penn Mutual, a Pennsylvania mutual life insurer since 1847.

The deal, which is contingent upon regulatory approval, allows Penn Mutual to expand the reach of its life insurance and annuity products through Vantis Life’s direct-toconsumer and bank channels. Both companies will continue to operate under their current brands and maintain their respective management teams and workforces.

“Penn Mutual is committed to growing our leadership position within the life insurance industry and

maintaining our strong track record of success,” begins Eileen McDonnell, chairman and CEO, Penn Mutual. “This combination will allow us to reach more Americans with much needed financial products and advice.”

Vantis Life has distribution agreements with more than 150 banks and credit unions, including large super-regional and regional banks, and a footprint that spans 45 states with more than 10,000 branch locations.

“For 75 years, Vantis Life has had unyielding dedication to providing protection products to underinsured, middle-income households,” says Peter L. Tedone, president & CEO of Vantis Life. “Penn Mutual’s 169-year history and financial wherewithal will allow Vantis Life to continue to develop and deploy cutting-edge technologies and distinctive strategies to reach new customers.”

Penn Mutual is one of only 12 life insurers to maintain a rating of A or better by A.M. Best for

over 75 years—making the list for 88 consecutive years and is currently rated A+ (Superior) by A.M. Best. Penn Mutual is rated Aa3 (Excellent) by Moody’s and A+ (Strong) by Standard & Poor’s. The outlook for all three ratings is stable.

“We anticipate that Penn Mutual’s financial strength and solid ratings with the three major rating agencies will open new distribution opportunities for Vantis Life,” says Tedone. “Penn Mutual’s culture and status as a mutual life insurance company is a natural fit for Vantis Life, which is focused on providing ‘A Better Life Experience’ to customers and agents.”

For more information, visit Penn Mutual at http://www.pennmutual.com/ or call Vantis Life at 1-860-298-5410.

A Commitment to Serve

Paul Dougherty’s dedication to the profession and exemplary leadership skills will come in handy as he leads NAIFA toward a bright and prosperous future.

By Ayo Mseka

By his own admission, Paul Dougherty is just an average guy. “There is nothing remarkable about me,” he told us when we visited him at his home in Maryland this summer. But he is willing to “give everything [his] all,” and this makes him the perfect guy to lead NAIFA as the association executes strategies designed to grow its size and reach.

“My personal philosophy is to give it all away,” Dougherty shared with us. “I am willing to say yes to requests for help, and I will do all I can to make things better. I tell my kids that I serve others as a way to serve my creator. That is the way I give back — through my service to others.”

Dougherty has been in service to others for nearly 25 years, ever since he landed a job as a State Farm employee — a job he stumbled upon by accident. His parents had invited their State Farm agent to their home, and his mom told the agent that Dougherty was a newly minted college graduate with no job. The agent portrayed State Farm as a great company to work for, and this got Dougherty’s interest. He applied for a position there and after several interviews, he was offered a job. A few years later, he became an insurance agent because of the opportunity it afforded him to set his own hours, make a good living and help clients avoid the risks that they might not even know they have. “That was very gratifying to me,” he said.

As a new agent, Dougherty faced many challenges, not unlike those encountered by other new agents. He was assigned to Hyattsville, Maryland, which was a new community to him. He and his wife were in the process of moving, and they had just had a baby.

But he quickly realized that he had been given an opportunity to help those around him, those who had not been well treated or maintained and those who were sometimes taken advantage of by others. “It was gratifying to be their professional advisor,” he said. “There may have been some lean days, but you did what had to be done, knowing that even if you don’t get paid today, you will be paid in other ways besides money, such as good relationships with your clients and enhanced opportunities for networking in the community. You knew that if you did it for the right reasons, you will achieve success, and the lean days will soon be behind you.”

Dougherty’s lean days are now firmly behind him, thanks to his hard work, willingness to go the extra mile and a firm conviction that “doing it for the right reasons” always pays off. Today, he runs a highly profitable agency, which services mostly minority clients, including African Americans and Hispanics. His agency offers nearly 100 insurance and financial-services products, which gives it an opportunity to be a onestop source of professional advice

”to many of his clients. “Many of our clients do not have CPAs or attorneys working for them — they have only us. This gives us a chance to help educate them.”

As an agent from a demographic group different from most of his clients, he has encountered some interesting challenges. “It is sometimes difficult to understand some of the cultural differences between the various Hispanic groups, for example, but by demonstrating interest, spending time with your clients and asking a lot of insightful questions, you get to understand their financial goals and aspirations and figure out what works best for them. The time spent with them makes you a better agent and one who is more trustworthy,” he said.

His professional success has been recognized by numerous industry and company awards. And he has become a passionate advocate for the insurance industry in general and for the role of the agent in particular. A trustee on the NAIFA-National Board from 2010 to 2013, Dougherty has served the federation in many capacities. He has also traveled extensively to home offices, building relationships and encouraging membership.

Success strategies

With the high level of success Dougherty has achieved, he is well qualified to offer words of wisdom to other agents and advisors looking

My personal philosophy is to give it all away. I am willing to say yes to requests for help, and I will do all I can to make things better. I tell my kids that I serve others as a way to serve my creator. That is the way I give back — through my service to others.

–Paul Dougherty, ALHC, HIA, LUTCF, FSS

to move their practices forward. To new agents trying to make it in the business, his advice is for them to know that others have been where they are now, and that it is OK to struggle initially. Also, they must understand that there are others willing to give them a helping hand and remember that, as is the case with any endeavor, they must be in the financial-advising business for the right reasons and must be highly motivated by a desire to help others. “If you are motivated and sincere in your dealings with your clients, that sincerity will shine through, and success will follow,” he said.

For the more seasoned agents, he has this to say: “We accelerate so well so early in our careers that we sometimes put ourselves in neutral, become apathetic and lose our appetite and passion for the industry. Sometimes, the things we used to do worked so well that we stop doing them. We have to go back to the things that worked well for us in the past and start doing them again.”

Mid-career agents can also rekindle their careers by exploring new market niches or reaching out to new advisors who might want to learn from them. “By helping them, you can become more engaged and more passionate in your career,” he said.

And finally, all agents and advisors can expedite their success by enrolling in NAIFA’s Leadership in Life Institute. Dougherty recently

celebrated the 11th anniversary of his graduation from LILI, which he describes as “the best professional development program I have ever participated in.” LILI taught him “not to sweat the small stuff” and showed him how to establish the right priorities. “It teaches you to start with the end in sight, which will help direct your path and assist you in identifying the correct priorities so that you can recognize all that you can achieve.”

Finally, he said, all agents can become better by joining NAIFA. His association with NAIFA started when, as a new agent, he attended an agency meeting. There, the then-president of his local NAIFA association, Shanna Stringfield, asked him to become a member. When his agency manager offered to pay for his membership, he figured that it was a win-win situation and promptly said yes.

To this day, he believes that this was the best move he has made in his career. “From the very first meeting,” he said, “I realized that I was with folks from different backgrounds, companies and experience levels, folks who were there to do better at what they do, network, share experiences and acquire sales ideas. These were folks who were willing to give away what they know. I thought this was a good place to be, and I have been a passionate NAIFA member ever since.”

Soon after becoming a member, the requests for help started. And

in keeping with his tendency to give it his all, he kept saying yes. “But the interesting thing is that I have benefitted each time I have said yes,” he said. “You learn from folks around you. My willingness to help has resulted in opportunities for me to have an impact on our industry and on the entire country. What a tremendous gift that is! Whenever we contribute toward NAIFA’s success, we are contributing to our own success and that of our clients.”

The power of NAIFA membership Dougherty has also been reluctant to say no to any of NAIFA’s requests for help because he knows the tremendous benefits that come with NAIFA membership — great sales ideas, endless opportunities for networking and a group of dedicated NAIFA employees working to protect the industry from legislative and regulatory threats and developing programs that help members succeed. “NAIFA’s benefits make us better agents,” he

“

My willingness to help has resulted in opportunities for me to have an impact on our industry and on the entire country. What a tremendous gift that is!

–Paul Dougherty,

ALHC, HIA, LUTCF,

FSS

Dougherty and his wife, Elizabeth

Members of the Dougherty Family. From left to right: daughter, Madeline; Paul; wife, Elizabeth; and son, Jacob.

said. “They benefit us as we help our clients protect the ones they love.”

NAIFA members expect everyone to know all that NAIFA offers, but that is not always the case. They have to be reminded that NAIFA’s advocacy program, for example, is second to none and is worth every penny of their membership dollars. “We tell our clients to buy insurance for times when they are unable to work or for when they are no longer around. My NAIFA membership does just that — it is my professional insurance and I have an obligation to get it and maintain it,” he said.

Shaping the future

The value of NAIFA membership is a subject close to Dougherty’s heart, and it has greatly influenced what he and members of NAIFA’s Executive Committee will be focusing on during Dougherty’s term of office. Over the next several months, Dougherty and his team plan to:

• Execute NAIFA 20/20, the strategic plan designed by NAIFA leaders and members to propel the association forward to 2020 and beyond.

• Create opportunities for enhancing the association’s revenue base by offering new credentialing and licensing programs, since the business environment and NAIFA are changing.

• Continue building and fostering relationships with the association’s Corporate Partners, sister organizations and other industry stakeholders.

• Implement NAIFA 20/20 ’s ideas for driving membership growth. NAIFA has had some success with the Pilot Membership Program, which offers a new way to perform an old task.

• Develop programs that cater to diverse markets. As the U.S. becomes more diverse, these programs will help NAIFA members enhance their understanding of the markets they serve and position them for greater success.

Family, faith and telling the NAIFA Story

As we spent more time with Dougherty, we were able to get a glimpse of what drives him each day, what motivates him to sacrifice so much of his time and effort in service to others.

First, there is his family — wife, Elizabeth, an attorney; daughter, Madeline, a college student; and son, Jacob, who will soon be going to college. “Family time is important to me,” he stressed. “I sacrifice office time to take care of my family.”

A major part of taking care of his family is cooking for them. “It is critical for me to cook dinner every night,” he said. “The kitchen is the heart of our home and a bit of a sanctuary for me. I am actually well known for my pasta sauce and bread. I can quickly come up with

unplanned meals — much to the delight of my family. For me, it is all about love, faith and family.”

And then there is telling the NAIFA story, which gives him an opportunity to share NAIFA’s legacy and talk about the strength and influence the association has had for more than 125 years. “I have become a better agent in my practice thanks to NAIFA, and I am better able to serve my clients and shape the future of the industry. NAIFA is indispensable to what all of us do as agents and advisors. We are facing a challenging environment right now, and we must be ever vigilant in defending the products and services we offer. We cannot let our foot off the gas.”

NAIFA has a bright future, he said, and he is willing to sacrifice the time and effort it takes to lead the association toward that future. He is honored and thrilled to be given the opportunity to serve NAIFA, and he considers it a tremendous responsibility.

“Members have put their faith in me to lead NAIFA,” he concluded. “I will do my very best to make sure that they get my very best.”

I have become a better agent in my practice, thanks to NAIFA, and I am better able to serve my clients and shape the future of the industry.

–Paul

Dougherty, ALHC, HIA, LUTCF, FSS

Paul Dougherty at a Glance

• NAIFA trustee from 2010 to 2013

• Past president of NAIFA-Maryland

• LILI graduate

• Recipient of numerous industry and company awards

Dougherty with members of his staff

Dougherty in White House Situation Room

NAIFA ClientCast® is for your clients. An online radio program, covering a wide array of topics, designed to touch your clients and prospects monthly with audio content that motivates them to take action with you, their NAIFA professional.

Power Session LIVE is for you. An interactive, web-based coaching session. Our webinars provide a “taste of MDRT,” featuring the best and most successful industry experts to share sales ideas and best practice strategies to help you build and strengthen your business.

This is the best NAIFA member writing one piece of business to make my NAIFA membership worth the investment. It is the one drip marketing tool that really works, and I would recommend it to anyone.”

— NAIFA member Lance Leonard, Issaquah, WA

Excellent presentation on a complicated subject in a short period of time!”

— NAIFA member Joe Anthes, Hopatcong NJ In reference to MAXIMIZING Social Security with Robin Mueller (Jan. 2015)

2016 NAIFA Annual Conference

By Ayo Mseka

NAIFA’s Annual Conference Is Performance Purpose!

If you were among the hundreds of financial advisors who made it to Las Vegas for NAIFA’s 2016 Performance + Purpose Conference this September, you most likely went home a winner. With its focus on performance and its re-designed programming, the conference provided the strategies you need to enhance the financial performance of your practice.

On Friday, September 16, attendees participated in two new events — the NAIFA Masters Exchange, where they gained critical insights from industry

greats, and a Stop Hunger Now Service Project, where they helped package meals for people in need.

And on Saturday, September 17, they had a unique opportunity to attend an educational workshop on the Department of Labor rule. As noted by NAIFA CEO Kevin Mayeux, CAE, “Our comprehensive, four-hour Skill Builders workshop on the DOL rule helps advisors understand the rule’s requirements and restrictions, develop strategies to implement the rule within their practices and

become compliant while best serving the needs of their clients.”

The DOL rule is a topic of major concern to many NAIFA members. According to a recent NAIFA survey, many believe the rule will damage their ability to serve clients, particularly their lower- or middleincome clients. More than 62 percent said the rule will, or will probably, force them to stop serving some or all of their clients, and 11 percent were unsure if the rule would force them to stop serving clients.

The 2016-2017 NAIFA Board of Trustees

Front row (l-r): Treasurer Matthew Tassey, Secretary Jill Judd, President-Elect Keith Gillies, President Paul Dougherty, Immediate Past President Jules Gaudreau, CEO Kevin Mayeux.

Second row (l-r): Delvin Joyce, Bryon Holz, Todd Grantham, Aprilyn Geissler.

Third row (l-r): Charles Olson, Thomas Michel, Brock Jolly, David Beaty, Cammie Scott, Greg Toscano. (Not pictured: Booker Joseph)

NAIFA President Jules Gaudreau

NAIFA CEO Kevin Mayeux

Pursuing diverse markets

With the explosive growth of diverse communities in the U.S., many advisors are discovering that pursuing multicultural prospects is one of the best ways to boost production. On hand to show attendees how to pursue these often lucrative markets were some members of NAIFA’s Diversity Task Force — Aamir Chalisa, MBA, LUTCF, with Futurity First; Irma Quinones, CLTC, CLU, ChFC, LUTCF, with New York Life; Ali Agha, CFP, CLU, ChFC, with New

York Life; as well as Bryan Hughes, with Northwestern Mutual.

According to these experts, the best way to achieve success in these markets is to:

Be open to learning about different cultures, ask questions and show genuine interest in your prospects’ goals, aspirations and concerns.

“When people see that you are trying to learn about their cultures, they will truly open up to you,” said Ali Agha. • Use the fact-finding exercise as an opportunity to learn what makes your prospect tick, added Agha. For example, he said, you can ask how your prospects make financial decisions in their households. In dealing with couples from different ethnic backgrounds, always try to involve both spouses in all decision-making efforts. Embrace diversity thoroughly and do a thorough research on the group you are targeting. Google is a good way to start the research process, they advised.

NAIFA has recently released a report, “Finding Success in Diverse Markets” (available at bit.ly/ NAIFA_Report), which examines the diverse communities that are rapidly changing the face of America and offers critical insights for successful engagement. The report is sponsored by The Penn Mutual Life Insurance Company, an organization that recognizes the opportunities that lie ahead for advisors serving diverse markets. NAIFA has also secured the National African American Insurance Association (NAAIA) as a diversity partner.

Promises kept

During the General Session on Sunday, NAIFA President Jules

Gaudreau, ChFC, CIC, provided attendees with a checklist of some of the association’s accomplishments over the past year. Among them:

✔ Strategy: NAIFA created NAIFA 20/20, a strategic plan that reflects the realities of today and the possibilities of tomorrow.

✔ Operations: NAIFA operated under the discipline of a business plan developed from the strategic plan, identifying the key performance indicators of association success, with objective measures to determine progress.

✔ Fiscal Stewardship: NAIFA exercised financial discipline, making difficult decisions to cut non-essential expenses, assess staff size and remediate future pension liabilities so that future generations of NAIFA members would not be asked to pay for legacy liabilities from the past.

✔ Advocacy: NAIFA fulfilled its promise of advocating for the industry, with the DOL’s fiduciary rule a primary focus in 2016. “Unfortunately, the wedge it will drive between advisors and middle-income investors is something we just couldn’t stomach; so under my watch, NAIFA sued the federal government for the first time in a generation, proving once again that NAIFA was built for times like these.”

✔ State Support: NAIFA members on the local and state levels are the roots of advocacy at all levels, and the creation of the Capitol 50 Program is testament to NAIFA’s promise to support state associations.

✔ Member Value: NAIFA refined its professional development strategies based on comprehensive research from Association Laboratories. This conference reflects a new direction in the delivery of professional development, education and sales ideas to members.

✔ Diversity: NAIFA promised it would reach out to and serve more diverse communities to make the

association more reflective of the profession and the country.

Gaudreau cited other NAIFA accomplishments, including improving industry relations and collaboration with all members. “Check! Check! Check! We did all of those and we kept our promises,” he said. As a mission-driven organization, “we must think bigger, better and bolder,” he added. “Have faith in our execution…I’ve done my best. I hope it mattered.”

A great time to sell more insurance

On Monday, September 19, veteran producer and popular speaker Van Mueller, LUTCF, told the audience that although the U.S. will be facing a financial crisis, now is the greatest time to sell life insurance. While we are being told that the economy is recovering, the Federal Reserve is afraid to raise short-term interest rates. “Does that sound like a recovery?” he asked. “You are the only hope for the American people,” he said. “It’s your time.”

Advisors often make a mistake by telling clients and prospects that they know what is going to happen. A better approach is to emphasize that no one knows what will happen. The presidential race, the Federal Reserve, SEC regulations and myriad other things all create uncertainty. Life insurance, on the other hand, provides security and liquidity, as well as the opportunity to access credit, which will dry up in a full-blown crisis.

Most Americans would prefer to be guaranteed that they will never be poor than to have an opportunity to be rich. So advisors need to change their messages to prospects and clients. “Don’t tell people you will make them a lot of money,” Mueller said. Instead, explain how you can help them protect what they already have with life insurance.

In one of his typical “elevator speeches” with prospects, Mueller often asks, “Is there someone at the IRS or the local nursing home you are so in love with that you want to

leave all of your money to them?” He then explains how life insurance provides tax advantages and can mitigate retirement and long-term-care expenses.

In another elevator speech to prospects, he says, “We’re afraid there’s going to be a major economic disaster and we don’t understand why people let it happen to them, because it doesn’t happen to any of our people.” The point is to grab a prospect’s attention and open the door to a discussion about the security that life insurance provides. Overwhelming a client or prospect with “fabulous information” will not resonate with them. To be successful, advisors must have conversations, ask questions and build relationships.

The business of NAIFA

Also, on Monday, NAIFA leaders and members tended to the business of the association. One year after joining NAIFA as its CEO, Kevin Mayeux, CAE, told the National Council that the association “has forged a new path” through NAIFA 20/20 (learn more at bit. ly/NAIFA2020). In his address, he recalled how he was “impressed and inspired” by NAIFA members’ dedication and loyalty to their association. But to move forward, leaders must acknowledge existing challenges, such as an aging and shrinking field force, declining NAIFA membership and increasingly burdensome government legislation and regulation.

NAIFA 20/20 provides a new financial and business model to streamline the federation, diversify revenue and grow membership. The plan identifies three major goals for the next five years:

✔ Empowerment. This will create a positive environment for advisors and their clients. “NAIFA is the advisor community’s strongest and most resilient voice,” Mayeux said.

“Empowerment strengthens that voice and ensures our concerns are heard loud and clear in Washington and in every state capital.”

✔ Improving the NAIFA business model. By improving the model, NAIFA can more effectively and efficiently deliver member value and grow membership across the federation, with nimble decisionmaking, a governance structure that empowers NAIFA to act quickly and decisively on new opportunities and challenges.

✔ Transforming the NAIFA financial model to generate more revenue from a diverse portfolio of products and services, including training, certifications and direct corporate support.

“Tomorrow’s NAIFA will be different from today’s in the way it is structured, the products and services it offers, the markets it pursues and the members it attracts,” Mayeux said. “What we hold true, though, the values that we instill in each new generation of advisors — trust, service, integrity, professionalism, political involvement — those values will endure. By working together, there is no limit as to what we can accomplish.”

National Council

The association’s National Council also elected new officers and trustees. NAIFA’s new president is Paul R. Dougherty, LUTCF, FSS, HIA, of State Farm Insurance Companies in Hyattsville, Maryland.

“From state-run retirement plans to the DOL fiduciary rule,

Recognizing Top Performers

Performance + Purpose 2016 was more than a great place to take advantage of the knowledge and talent of great presenters — it was also a community gathering for attendees and the ideal place to greet old friends, make new ones, network with the best in the industry and share ideas.

Along with the larger community of advisors, the conference featured special events for various advisor groups, including young advisors, LILI graduates, LUTCF designees and members of Women in Insurance and Financial Services.

NAIFA Performance + Purpose was also the perfect venue for members of the NAIFA community to recognize their peers for their outstanding work and dedication to the profession. During the conference, Kim Kieschnick received NAIFA’s most prestigious honor in association management — the C. Carney Smith Award. Kieschnick is the executive director of NAIFA-Austin (Texas) and the 41st recipient of the Award, which was created to honor the legacy of C. Carney Smith, CLU. Established in 1976, the award promotes the advancement of professionalism in the field of association management among NAIFA state and local associations. Receiving the 2016 Young Advisors Team Leader of the Year Award was Jason Carter, LUTCF.

The 2016 John Newton Russell Memorial Award was bestowed upon D. Scott Brennan of South Bend, Indiana. The JNR Award is the highest honor accorded by the insurance industry to a living individual who has rendered outstanding services to the institution of life insurance.

Brennan, a career MassMutual agent, is a past MDRT president and an active and long-time NAIFA member. On accepting the award, he described himself as “a very ordinary man who worked in an extraordinary profession. I took a vow of poverty my first few years in the life insurance businesses. I didn’t qualify for the Round Table; I don’t think I would have qualified for an end table,” he said. “There may be someone here who is thinking about leaving the profession who shouldn’t. If that is so, I dedicate this talk to you. If I can do it, you can do it.”

He described the act of buying life insurance as “an exchange of emotion.” And to those agents who endure days of landing no sales, his advice is, “Forgive yourself. Learn how to accept the tough days and celebrate the great days. And, join NAIFA. NAIFA isn’t good because we are old. NAIFA is old because we are good.”

Also featured during the conference was The Client Service Recognition Program, which is sponsored by Life Happens and recognizes recipients of the Real Life Stories Awards. The emotional stories told by the recipients’ clients who overcame tremendous difficulties with the help of insurance captivated the audience and brought to life the powerful role insurance plays when tragedy strikes. Real Life Stories videos are available on the Life Happens website (lifehappens.org/videos/).

the future of our industry is being impacted by likely well-intentioned but misinformed legislators and unelected regulators,” Dougherty said in his first National Council address as 2016–2017 NAIFA president. “As a result, we cannot afford to only be vigilant — we must also be aggressive and proactive in our efforts to educate and inform our public leaders, to share with them the potential hazards faced by our customers when they attempt to navigate these financial waters without our help.”

Dougherty urged members to remain involved in NAIFA’s political

advocacy initiatives and to build upon relationships with elected officials so they will hear the NAIFA Story. “Every day, we ask our clients to sacrifice a little to protect what is at stake. It’s only right that each of us do the same” for the industry, he said.

He also encouraged members to help grow membership. “Our work today, tomorrow and for the next year together is to bring [non-members] to NAIFA, to help them understand that we are the guardians at the gate for our industry and that it’s time for them to pick up a shield and stick and do their part. Our most significant foe in today’s environment is apathy, and

our challenge is to kick in the door of those who are sitting on the sidelines and get them back in the game.”

NAIFA is on track for a successful future with implementation of NAIFA 20/20, he said. “We have to follow the course and be unapologetic in our pride as we get this done…We cannot quit, we cannot fail because so many others are counting on us…our clients, our communities, our country.”

Joining Dougherty on NAIFA’s Executive Committee are:

President-Elect Keith M. Gillies, CFP, CLU, ChFC, of Ameritas in La Place, Louisiana; Treasurer Matthew S. Tassey, CLU, ChFC, LUTCF, of

Principal Financial Group in Portland, Maine; and Secretary Jill M. Judd, LUTCF, FSS, of State Farm Insurance Companies in Capitola, California.

After serving his one-year term as president, Jules O. Gaudreau, Jr., ChFC, CIC, of the Gaudreau Group in Wilbraham, Massachusetts, becomes immediate past president and will remain a member of NAIFA’s Executive Committee.

Gregory T. Toscano, LUTCF, of Johnson Insurance Consultants in Duluth, Minnesota, was elected to the board to serve a two-year term. Toscano was previously a member of the board, 2013-2015. Delvin L. Joyce, CLU, ChFC, of Prudential Financial in West Palm Beach, Florida, was appointed to the board for a one-year term.

Re-elected for two-year terms were board members David A. Beaty, CLU, ChFC, LUTCF, of Heartland Financial Services in Cedar Falls, Iowa; Thomas O. Michel of Michel Financial Group in Los Angeles; Charles M. Olson, CLU, ChFC, of

OCI Financial in Omaha, Nebraska; and Brock T. Jolly, CFP, CLU, ChFC, of Capitol Financial Partners in Vienna, Virginia.

Remaining on the board as trustees are: Aprilyn Geissler, of the Chavez Geissler Agency in Albuquerque, New Mexico; Todd G. Grantham, CFP, CLU, ChFC, MSFS, of the Northwestern Mutual Financial Network in Durham, North Carolina; Bryon A. Holz, CLU, ChFC, LUTCF, CASL, of Bryon Holz & Associates in Brandon, Florida; Booker Joseph, CLU, ChFC, FLMI, of United Healthcare in Birmingham, Alabama; and Cammie K. Scott, LUTCF, REBC, RHU, of CK Harp & Associates in Springdale, Arkansas.

The National Council also voted in support of two bylaw amendments initiated by the NAIFA Board of Trustees. The first adjusts each NAIFA member’s national dues investment by $6.00 a month, beginning Jan. 1, 2017, to fund NAIFA 20/20 and maintain NAIFA’s operations as the plan is implemented.

The second will revise the existing NAIFA bylaws provision that authorizes the NAIFA Board to set a corporate dues rate for specific companies. The amendment authorizes the NAIFA Board to set dues rates for companies who wish to pay a group dues rate for their advisors, whether those companies are insurance carriers, independent advisor groups or broker-dealers.

Be sure to join us in Orlando from September 8 to 10 next year for the 2017 Performance + Purpose Conference. See you there!

By Michael Hedge and Steve Klein

Protecting Seniors from Financial Scams

NAIFA is working with lawmakers to clarify your obligations as you protect your senior clients from financial exploitation.

Federal and state legislators are working hard to pass laws that will clarify your obligations as an advisor when determining the steps to take to protect your senior clients from financial exploitation.

In June, the U.S. House passed its version of the Senior$afe Act of 2016. The bill was introduced as a companion bill to S. 2216. It is an attempt to increase protections for senior Americans susceptible to financial and investment fraud.

It provides that a supervisor, compliance officer or legal advisor for a covered financial institution who has received training regarding the identification and reporting of the suspected exploitation of a senior citizen (at least 65 years old) shall not be liable for disclosing such exploitation to a covered agency if such individual made the disclosure in good faith and with reasonable care; and a covered financial institution shall not be liable for such a disclosure by such an individual if such individual was employed by the institution at the time of the disclosure and the institution had provided such training.

NAIFA’s amendment

The bill sponsors worked extensively with NAIFA on an amendment to the bill that would extend liability protection to the registered representatives of broker-dealers. The NAIFA-backed amendment was accepted by a vote of the Financial Services Committee and helped ensure that support of the bill was unanimous.

NAIFA Government Relations is now working with Senate sponsors to further amend the language contained in the Senate version to fully include registered representatives and insurance producers, ensuring that all NAIFA members who work directly with clients are covered by the provisions of the Senior$afe Act.

Along with Congress, FINRA is proposing a regulation to address this issue of senior protection as well. FINRA issued Regulatory Notice 15-37 to solicit feedback on proposed rules addressing the financial exploitation of seniors and other vulnerable adults. One proposed new rule would permit firms to place a temporary hold on a disbursement of funds or securities when there is reasonable belief of financial exploitation and to notify a designated trusted contact of the temporary hold.

What states are doing

At the state level, a number of states have considered or enacted laws intended to protect seniors from financial exploitation. The state proposals call for financial advisors and their firms to report suspected financial exploitation of one of their senior clients to state authorities who can then conduct an investigation. The state laws also allow the firm to place a temporary hold, usually up to 10 business days, on the client’s requested transaction if attempted fraud is suspected.

NAIFA’s position

While NAIFA does not oppose these bills, the association’s position is that any senior financial protection bill should incorporate the following:

• Include a voluntary, not mandatory, reporting process.

• State that advisors report suspected fraud of a senior client to their firms, rather than go directly to authorities.

• Ensure that financial advisors are protected from liability if they report a senior client’s financial information to third parties in an effort to comply

with the law and protect their client from financial ruin.

NAIFA has been proactive in lobbying on these bills where they are introduced in state legislatures. This year, NAIFA-Louisiana and NAIFA-Colorado successfully lobbied to ensure that senior protection bills have a voluntary reporting process and shield advisors from legal liability for complying with those laws. And NAIFA-Oklahoma was able to persuade the State Securities Commissioner to withdraw a proposed senior protection regulation to address concerns raised by financial advisors.

Although Alabama enacted a senior protection law this session that requires mandatory reporting of suspected senior financial exploitation, NAIFA-Alabama secured a commitment from the State Securities Commissioner that concerns raised by advisors will be addressed in regulations to carry out the new state law. Vermont and Indiana passed similar laws this year. We expect that more states will consider enacting senior protection laws of this nature starting early next year.

NAIFA will continue to work to amend any legislative or regulatory senior financial protection proposal to ensure that the association’s views are incorporated and, importantly, that regulators and the industry can take steps to protect vulnerable seniors from financial scams.

Michael Hedge is director of government relations at NAIFA. Contact him at mhedge@naifa.org. Steve Kline is director of government relations at NAIFA. Contact him at sklein@naifa.org.

NAIFA Government Relations is working with Senate sponsors to ensure that all NAIFA members who work directly with clients are covered by the provisions of the Senior$afe Act.

By Toni Harris Taylor

4 Ways to Build an Effective Email Marketing System

Use an email service provider, segment your lists, determine the frequency of your communication and use reporting tools strategically.

Email marketing is an effective way of marketing your business and keeping your name and brand in front of customers and prospects. It is the most effective way to reach hundreds, even thousands, of people with the click of a mouse. Email is also one of the best ways to reach a targeted audience with your message.

According to Entrepreneur magazine, email is also 40 times better than Facebook and Twitter because it is the best way to “give” your message to your audience. It puts you, your company and your message right where people are all day long — their inboxes.

Here are four ways to make the most of these email attributes and build an effective marketing system:

1. Use an email service provider. If you are going to market your business through email, it is imperative that you use an email service provider. There are several on the market, but a few of the common ones are Constant Contact, MailChimp and E-Relationship. A reputable email service provider helps clients meet the guidelines of the Federal Trade Commission’s CAN-SPAM Act, including the important opt-out provision of the rule. A violation of this act can result in a hefty fine, so, please employ the services of an email service provider. This provider can also get past SPAM filters so that your email messages are delivered in your recipient’s inbox and not in their junk folder.

2. Segment your lists. All lists are not created equal. The lists that you include in your email marketing system should be segmented by existing clients, prospects and networking contacts.

This allows you to communicate the right message to the right list. Concentrate on growing your list and keeping it fresh. Remove the names of people who are not opening your email messages. You can use multiple methods to grow your list, including your website, your newsletter, fishbowl drawings and networking associates.

3. Determine the number of times to communicate with the people on your list. A general rule of thumb is to communicate once a month via a newsletter and then the occasional email with a holiday greeting or a special announcement. Finding the right balance is key. Most financial professionals are concerned about over-communicating, but I find that most don’t communicate enough. Find the right balance and test it out on

your audience. Gauge your audience’s response to know what’s right for them. For instance, with my email service provider, when people unsubscribe they can leave a comment on why they are unsubscribing. Pay attention to those comments and adjust your communication strategy accordingly.

4. Use reporting tools strategically. Pay attention to the email reports that are generated by your email service provider. The typical report displays who opened your email message and the date and time that they did. It also shows if they forwarded the email message, clicked on any links or shared the message on social media. You can also use the Bounce Report to keep your list clean. If used wisely, the reporting tools tell you exactly how effective you are in communicating with your audience. The reporting feature of an email service provider is gold!

Email marketing is another way to show up to remind your clients, prospects and networking associates that you are available to help them with their financial needs. I’m often surprised how, when I send an email message, I immediately get an appointment for business, a referral or a request for a speaking engagement. Put some time into your email marketing system and you will notice that the effort will pay off exponentially. But always stay compliant and let your compliance officer preview your email messages before hitting the “send” button.

A rule of thumb is to communicate once a month via a newsletter and an occasional email with a holiday greeting or a special announcement.

Toni Harris Taylor is a motivational speaker, marketing strategist and certified coach. She helps her audience and clients take drastic steps to achieve drastic results. You can reach her at www.toniharris.com.

10. Owner: NAIFA Service Corp, 2901 Telestar Court, Falls Church, VA 220421205. CEO: Kevin M. Mayeux, CAE; President, Paul Dougherty; Secretary: Jill Judd; Treasurer, Matthew S. Tassey

11. Known Bondholders, Mortgagees and Other Security Holders Owning or Holding 1 Percent or More of Total Amount of Bonds Mortgages, or Other Securities: None

12. Tax Status: The purpose, function and nonprofit status of this organization and the exempt status for federal income tax purposes has not changed during the preceding 12 months.

13. Extent and Nature of Circulation:

By Marvin Feldman, CLU, ChFC, RFC

Relevance

Your help as you guide your clients through the decision-making progress will ensure your relevance, even as robo-advisors and online sales proliferate.

Are you relevant? Are you needed by clients and prospects to achieve their financial goals? Not if you listen to the White House and the Department of Labor. They think today’s consumers would be better off without us and by using robo-advisors and online resources.

But here is the reality of what consumers think. According to the 2016 Life Happens/LIMRA Barometer Study, the majority of people prefer to purchase life insurance in person, typically so that they can ask questions and get immediate answers. About one in five prefer to apply online, mostly because this approach gives them the ability to research and comparison shop in their own time and at their own pace, without facing any pressure to buy. What the online buyers don’t get are the years of experience agents have in answering their questions that will help guide their decision-making process to the most appropriate decision.

A case in point

Let me give you an example. The prospect visits a doctor, and the doctor says to him, “All things considered, you are in pretty good shape for your age.” What the prospect hears is that he is in pretty good shape. He then goes online and gets a quote for preferred plus life insurance. But after he applies for the policy, completes all the paperwork and submits the medical information, he is issued a policy that is not at preferred plus, but at standard nonsmoker.

Now he is upset that the issued policy does not match his original quote. Ever been in this situation with a client? He doesn’t accept the policy because no one told him what the doctor really meant. The prospect is not preferred or preferred plus, but compared to other people similar to him, he is OK. Of course,

the other people similar to him are a little under tall for their weight, have elevated blood pressure and cholesterol levels and might even be pre-diabetic. He is lucky to get standard nonsmoker rates. If he were using an agent, the agent could have walked him through the process of applying for the policy and made him aware that he might not qualify for the best ultimate rate.

In which scenario is this person more likely to understand what he is buying, how it fits his situation, how it solves his insurance problem and how it is offering him a reasonably priced solution? Instead of being mad, he will understand the situation and will be satisfied with the advice and policy he received.

Will you be relevant?

This is what you do for your clients. Robo-advisors do not allow for the nuances of a doctor’s statement. You do. Will robo-advisors and online sales work? Of course they will. But they lack the human touch and the

understanding that is needed to guide prospects through the decision-making process. Are you relevant? Yes. Do the regulators and legislators understand this? I’m not sure they do. The new DOL regulation may adversely affect the number of agents and advisors in the business and make it more difficult for you to service your clients and prospects.

Will you survive and adapt to the new environment? Yes, you will, and the opportunities to work with the consumers will continue to be there. The population will continue to grow, and the needs of the consumer will be there. The method of reaching, educating and motivating them may be different in the future, but the human element will still be needed.

Yes, you will be relevant.

Marvin H. Feldman, CLU, ChFC, RFC, is principal of the Feldman Financial Group in Clearwater, Florida. He is president and CEO of Life Happens and a member of NAIFA-Pinellas. You may contact him at 727-723-9020.

The method of reaching, educating and motivating clients may be different in the future, but the human element will still be needed.