InsuranceNewsNet Magazine - December 2021 by InsuranceNewsNet

SPECIAL MOVERS & SHAKERS THOUGHT LEADERSHIP SECTION • PAGE 19

December 2021

CAN THE INDUSTRY MAINTAIN THE

MOMENTUM

More Americans recognized the value of insurance products in 2021, but can the industry ride that wave into the coming year?

PAGE 23

Shift Your Talk, Change Your World With Krister Ungerböck

PAGE 10

December 2021

TIMELY TRENDS

REVEALED Page 5

MDRT PUBLISHES THEIR 2021 MDRT FINANCIAL TRENDS INTERACTIVE SURVEY REPORT Trends impacting the industry | What industry professionals should be watching out for.

www.2021MDRTreport.com

It’s a good time to ask ...

MDRT is the premier association for elite insurance and financial services professionals. Members use our global network, dynamic events and unmatched resources to connect, share insights and explore the potential of what’s next.

MDRT. Where the best keep going. Find out if you qualify at join.mdrt.org

Independent Origins

Innovative Support

Industry Defining As the Original Agency Builder™, Brokers International has been building agencies for 38 years. Our innovative solutions, proven marketing programs, and exceptional service can help elevate your agency so you can achieve your unique goals. See what all the fuss is about at BILTD.com/INN.

844.858.4498

IN THIS ISSUE

View and share the articles from this month’s issue

» read it

DECEMBER 2021 » VOLUME 14, NUMBER 12

ANNUITY

FEATURE

36 H ow Annuities Can Smooth Rough Financial Waters

Can The Industry Maintain The Momentum? By Susan Rupe and John Hilton

COVID-19 showed consumers the value of insurance products in 2021. But can the industry keep the ball rolling in 2022?

INFRONT

By John Hilton Several legal analysts are warning advisors to be careful about these transactions in 2022.

14 Filling The Generational Pipeline

By Susan Rupe Mark Squires made a name for himself in the Medicare world, but he also has a passion for helping younger clients build a strong financial foundation.

The 2021 Movers & Shakers

INTERVIEW

10 S hift Your Talk, Change Your World

Krister Ungerböck left the corporate life to become an expert in leadership and language. He learned that words can destroy relationships but can build bridges as well. In this interview with Publisher Paul Feldman, he tells of how shifting the way you talk can increase understanding and improve relationships.

By Steve Scanlon Help clients stay on track the next time volatility and uncertainty hit the financial markets or the economy.

HEALTH/BENEFITS

40 3 Ways To Make HSAs The Choice For Employees By Amy O’Meara Chambers Making it easy for employees to understand the advantages of a health savings account encourages enrollment.

IN THE FIELD

6 Rollovers In The Crosshairs

online

www.insurancenewsnetmagazine.com

ADVISORNEWS

44 One-Size-Fits-All Retirement Planning Excludes People Of Color By Susan Rupe Each racial and ethnic group has its own set of concerns about retirement planning.

INBALANCE

We survey the industry to find the best carrier and product for 2021 and how it has impacted producers. • PAGE 19

48 A Gut Feeling: The Link Between Digestive Health And Mental Health By Susan Rupe Changing your diet could have a surprising effect on your mental health.

BUSINESS

LIFE

30 Open The Door To A Policy Review

By Caroline Brooks By helping your clients conduct routine policy reviews, you may uncover gaps in coverage and identify new planning opportunities.

50 Great Seller Experiences Facilitate Better Buying Experiences By Lloyd Lofton Buyers need sellers to exceed expectations at every interaction. Sellers must have the ability to facilitate buying decisions virtually.

INSURANCENEWSNET.COM, INC.

275 Grandview Ave., Suite 100, Camp Hill, PA 17011 717.441.9357 www.InsuranceNewsNet.com

PUBLISHER MANAGING EDITOR SENIOR EDITOR VP SALES SENIOR MARKETING DIRECTOR

Paul Feldman Susan Rupe John Hilton Susan Chieca Melissa Mursch

CREATIVE DIRECTOR GRAPHIC DESIGNER COPYWRITER DIGITAL CAMPAIGN MANAGER MANAGER/ACCOUNTANT MARKETING PROJECT MANAGER

Jacob Haas Shawn McMillion Ash Emrich Megan Kofmehl Jen Wingard Kelly Cherrup

MEDIA OPERATIONS MANAGER NATIONAL ACCOUNT DIRECTOR NATIONAL ACCOUNT DIRECTOR NATIONAL ACCOUNT DIRECTOR DATABASE ADMINISTRATOR

Ashley McHugh Sarah Allewelt Brian Henderson Dominic Colardo Sapana Shah

Copyright 2021 InsuranceNewsNet.com. All rights reserved. Reproduction or use without permission of editorial or graphic content in any manner is strictly prohibited. How to Reach Us: You may e-mail editor@ insurancenewsnet.com, send your letter to 275 Grandview Ave., Suite 100, Camp Hill, PA 17011, fax 866.381.8630 or call 717.441.9357. Reprints: Copyright permission can be obtained through InsuranceNewsNet at 717.441.9357, Ext. 125, or reprints@insurancenewsnet.com. Editorial Inquiries: You may e-mail editor@insurancenewsnet.com or call 717.441.9357, ext. 117. Advertising Inquiries: To access InsuranceNewsNet Magazine’s online media kit, go to www.innmediakit.com or call 717.441.9357, Ext. 125, for a sales representative. Postmaster: Send address changes to InsuranceNewsNet Magazine, 275 Grandview Ave., Suite 100, Camp Hill, PA 17011. Please allow four weeks for completion of changes. Legal Disclaimer: This publication contains general financial information. It should not be relied upon as a substitute for professional financial or legal advice. We make every effort to offer accurate information, but errors may occur due to the nature of the subject matter and our interpretation of any laws and regulations involved. We provide this information as is, without warranties of any kind, either express or implied. InsuranceNewsNet shall not be liable regardless of the cause or duration for any errors, inaccuracies, omissions or other defects in, or untimeliness or inauthenticity of, the information published herein. Address Corrections: Update your address at insurancenewsnetmagazine.com.

InsuranceNewsNet Magazine » December 2021

COMPETITIVE PROTECTION PALLADIUM® MULTI-YEAR GUARANTEE ANNUITY SERIES

Offer your client competitive protection with Palladium® MYG! MYG 3-Year Available Now The Palladium® Multi-Year Guarantee (MYG) Annuity offers Guarantee Periods from 3 to 10 years. This ﬁxed deferred annuity offers the option to choose from one of these guarantee periods1 to lock in a competitive accumulation interest rate for the period selected.

Guaranteed Growth Palladium® MYG may fit your client’s financial needs, should they desire an attractive fixed interest rate and the ability to grow their earnings on a tax-deferred basis.

Protection for the Future

Competitive Banded Premiums

• Conﬁnement Waiver

• Band 1: $5,000–99,999 • No Bonus

• Terminal Illness Waiver

• Band 2: $100,000–249,999 • 10 bps Bonus3

• Disability Waiver2

• Band 3: $250,000+ • 25 bps Bonus3

There’s no reason to wait! Call 1-888-501-4043 today or visit img.anicoweb.com for more information or to run a quote. 1) For the Duration of the Interest Rate Guarantee Period as stated on the contract’s data section. Rates subject to change for new issues at any time. All interest rates are declared as annual effective rates of interest. Interest is credited to your annuity daily on a compound basis assuming a 365-day year. 2) All waivers may not be available in all states. However, any increase in the value of the annuity contract will be taxable as ordinary income, as would any withdrawals from a qualiﬁed contract. 3) For initial premiums of $100,000 or more, add 0.10% for the duration of the Interest Rate Guarantee Period as stated in the contract’s data section; add an extra 0.25% for $250k+. Form Series: MYG20. (Forms may vary by state). CA Form: MYG16. American National Insurance Company, Galveston, Texas. Not FDIC/NCUA insured | Not a deposit | Not insured by any federal government agency | No bank/CU guarantee | May lose value

For Agent Use Only; Not for Distribution or Use with Consumers. AMERICAN NATIONAL INSURANCE COMPANY 888-501-4043 | img.anicoweb.com

IMG22746 | INN 12.2021

WELCOME LETTER FROM THE EDITOR

December: Maybe Not So Dark?

flipped through a month’s worth of pages on the “daily inspiration calendar” I received for Christmas last year and found a few gems for the month of December.

I Heard A Bird Sing By Oliver Herford I heard a bird sing In the dark of December. A magical thing And sweet to remember. “We are nearer to Spring Than we were in September,” I heard a bird sing In the dark of December. And something by Dr. Seuss that nails down today’s mood as we say goodbye to daylight saving time.

“How did it get so late so soon? It’s night before it’s afternoon. December is here before it’s June. My goodness how the time has flewn. How did it get so late so soon?” The final month of the year can be a dark time as we look back on the preceding months while looking into the crystal ball to predict what’s next. This December, our editorial team decided to focus on what’s ahead — and the road ahead seems much brighter than it was at this time in 2020. The disruptions of 2020 forced the life/health insurance industries into an epic realignment. The industry reacted to the challenges in many ways, including a greater adoption of technology, a streamlining of the sales process and an increased consumer demand. And those reactions paid off. In the first half of 2021, life insurance sales reversed a decadeslong slump to rise to their highest level in nearly 40 years. But the new challenge is whether the industry can ride that wave of consumer interest into 2022. Will consumers return to their previous complacency and reluctance about buying coverage? Another challenge that the industry 4

faces in 2022 is one that almost every other industry faces — the war for talent. Recruiting and retaining always have been difficult. But the “Great Resignation” brought about by the pandemic and the remote work revolution saw some carriers reporting a 30% to 40% turnover during the past year. Where will new workers come from? And how can companies make their offerings attractive enough to keep those new workers around? What comes out of Washington also will impact the industry. At the time of this writing, Congress is poised to vote on the Build Back Better Act, a package of social and climate change bills. If passed, the act includes $165 billion to reduce health insurance premiums for those covered under the Affordable Care Act, expand Medicaid to cover an additional 4 million people and implement prescription drug price reform. The act also proposes tax changes that are relevant to businesses and highly compensated C-suite management. This means that your high-net-worth clients will need your advice more than ever. One item cut from the bill was a new version of taxable Build America Bonds. These bonds would have helped municipalities finance new infrastructure projects. And it was something the life insurance industry had looked forward to being a part of. Earlier this year, Bruce Ferguson, senior vice president of state relations for the American Council of Life Insurers, told the National Association of Insurance and Financial Advisors that Build Back Better would give the life insurance industry a chance at what he called a “moon

InsuranceNewsNet Magazine » December 2021

shot” in terms of expanding its investment in underserved communities. He pointed to the Obama administration’s economic recovery program, when life insurers invested heavily in Build America Bonds, Ferguson said. These bonds were aimed at improving infrastructure at the municipal level and raised funds to improve roads, bridges and schools as well as to upgrade water systems. Much of that investment was made in underserved communities. Build Back Better bonds may be off the table, but the industry still is looking at ways to take the investment capital insurers have and partner with foundations and community groups that have close ties to underserved communities. ACLI’s Economic Empowerment and Racial Equity Initiative has four pillars. They are: 1. Determining what the industry can do to advance and expand access to affordable financial security in underserved communities. 2. Advancing diversity and inclusion within insurance companies and their corporate boards. 3. Achieving economic empowerment through financial education. 4. Expanding investments in underserved communities. In addition, ACLI is working with The American College of Financial Services on its Four Steps Forward initiative aimed at moving more households out of poverty. Whatever 2022 brings, one thing is certain. The industry will continue to find ways to serve more individuals, families and businesses. We wish you all a healthy and successful new year as you continue to help your clients achieve financial security. Susan Rupe Managing Editor

Sponsored Content

Timely Trends Revealed in New MDRT Survey Report: An Interview With Randy Scritchfield, 2022 MDRT President Randy Scritchfield, 2022 MDRT president with three Court of the Table and 20 Top of the Table honors to his name, has more than 37 years of MDRT membership. In this interview, he reveals key findings you’ll discover in this year’s MDRT report, which is crammed with perspectives from consumers, financial advisors, and MDRT leaders and members that can help improve your practice.

Tell us, is there anything about the way the MDRT survey has been done, or topics included, that has evolved in the past couple of years?

SCRITCHFIELD: The recent surveys we’ve conducted included more references to digitalization and fintech, as well as more on emotional intelligence and assessing the consumers in that regard. We’ve also included aspects that would be important to the independent financial professional, which is representative of MDRT, at least in North America.

Thinking back to last year’s annual trends report — what did MDRT members find the most surprising?

SCRITCHFIELD: For those who’ve been in the business as long as I have, the survey validated what we’re experiencing with clientele every day. But for newer members, it was enlightening. The survey discovered that consumers are working with those in multiple areas of financial planning, including investment, wealth management and, of course, insurance, which is the foundation MDRT was built on. Also, the survey again showed an increased interest in long-term care (LTC) insurance, which connects to the increasing challenges of underwriting.

What other trends did you see in this year’s survey? Do you expect them to continue over the long term?

SCRITCHFIELD: Of course we can’t predict the long term, but one takeaway was that 31% said the pandemic made them feel more driven to acquire and maintain life, disability and long-term care coverage. While there is consumer awareness and sensitivity around the need for insurance and investment products, as financial professionals we have to be mindful because the need will not wane, but consumers’ sensitivity to it eventually will. The survey results also showed 18% of respondents favor keeping cash and cash equivalents. A lot of people aren’t comfortable investing and prefer to stay in cash because they’re not working with a financial professional.

What creative ways have members leveraged information like this in the past?

SCRITCHFIELD: Members see it’s not just about products and prices, but it’s also about managing relationships — and probably even more important, managing behavior. This was especially the case at the onset of the pandemic when the markets dropped precipitously. MDRT members were comforting and counseling clients to stay in the markets while we rode through this.

What resources are available for MDRT members working with clients during a pandemic and other hard times?

SCRITCHFIELD: We’ve cranked up our content creation over the past 18 months, specifically around counseling clients to do something they ultimately will need to do — before they feel the need to do it. Organically, over this past year, study groups are coming together that draw on these resources. Even when we couldn’t have our signature in-person events, membership grew by 50%. I attribute that to quality content like this report.

What are the benefits of the report that inspire financial professionals to become members and grow their business?

SCRITCHFIELD: We use the survey results as a guideline for relevant content development. As we return to in-person meetings, you’ll see these findings reflected in our on-stage programming as well. For the first time since 2017, U.S. membership increased. Despite not having our signature in-person events, MDRT members and aspirants have been more engaged than ever.

Why is this year’s report a must-read?

SCRITCHFIELD: It reminds us how important the basics are, from the fundamentals of life insurance to investing properly to things that aren’t on the consumer’s radar until it’s often too late. This report provides insights into risks MDRT team members help people manage — dying too soon, living too long, or becoming sick or disabled. It really isn’t more complicated than that.

GO TO

www.2021MDRTreport.com FOR ACCESS TO EXCLUSIVE DATA AND INSIGHTS.

INFRONT

Rollovers In The Crosshairs Advisors must be in compliance with the new Department of Labor investment advice rule by the end of January. The impact on rollover business is significant. By John Hilton

hen the Department of Labor crafted its investment advice rule, everyone knew the types of questionable sales practices it had in mind. But its biggest impact might come on simple rollovers, the kind of transactions that had not been considered fiduciary advice in the past. Several legal analysts are warning advisors to be careful about these transactions in 2022. “Many may be surprised to learn that this ruling impacts all wealth managers who recommend rollovers, even if the advisors had no advisory relationship with a plan itself,” wrote Kim Shaw Elliott, a partner with The Wagner Law Group, in a client alert. “This is a major departure from past practice, since historically advice to roll assets out of a Title I Plan, even when combined with a recommendation as to how the distribution should be invested, did not constitute investment advice,” she noted. The rule was authored during the 6

Trump administration, but the Biden administration allowed the investment advice rule to take effect Feb. 16. It replaces the Obama administration fiduciary rule, which imposed substantial regulations on commission-based sales of annuities. A federal appeals court sided with industry plaintiffs and tossed out the rule in 2018. The investment advice rule has two main parts: new Prohibited Transaction Exemption 2020-02, allowing advisors to provide conflicted advice for commissions, and a reinstatement of the "five-part test" from 1975, to determine what constitutes investment advice. It came with a compliance date of Dec. 20, but the DOL is giving advisors a sixweek pause, until Jan. 31, 2022.

Pay Attention

The penalties for running afoul of the new advice rules are significant, Shaw Elliott noted. “Advisors who engage in prohibited transactions can be punished severely, including a whopping excise tax of up to 100% of the amount involved, compounded over time,” she wrote. “The IRS might disqualify the IRA, resulting in the entire value of the IRA being included in the income of the IRA owner in the year of the breach.” So how did we get here? Let’s back up and review the law.

InsuranceNewsNet Magazine » December 2021

Long-standing Employee Retirement Income Security Act law forbids an investment advisor from receiving additional compensation as a result of a recommendation to a plan or plan participant unless an exemption is available, Shaw Elliott explained. Under the new interpretation, the rollover advice itself likely is conflicted. “This is true even if the adviser goes from receiving no compensation when the recommendation is made to any compensation in the future from the IRA,” she wrote. “The advice is considered fiduciary investment advice because it is necessarily a recommendation to liquidate or transfer the plan’s property interest in the affected assets and the participant’s property interest in plan investments.” More transactions than what are traditionally thought to be rollovers are considered. The investment advice rule prohibiting transaction exemption defines a rollover to cover five different transactions: » ERISA-covered plan to an IRA. » ERISA-covered plan to another ERISAcovered plan. » IRA to an ERISA-covered plan. » IRA to another IRA to the extent permissible under the Code (including an individual retirement account, Health Spending

ROLLOVERS IN THE CROSSHAIRS INFRONT Account, Archer Medical Savings Account, Coverdell Education Savings Account), to the extent permissible under the code. » Different account type, such as converting from a brokerage account to an advisory relationship or from a commission-based account to a fee-based account. The new rule does not mean that IRAs have now become ERISA plans, Shaw Elliott emphasized. The new guidance confirms that the DOL has authority to conclude what is “investment advice” for either type of retirement program so that it can properly evaluate whether a prohibited transaction has occurred. The IRS, however, remains the sole enforcer of the tax rules that affect IRAs.

What To Do

Relief is available for conflicts of interest under 2020-02, Shaw Elliott noted. That relief will allow for the receipt of thirdparty compensation such as 12b-1 fees, revenue sharing and sub-TA fees as well as commissions, bonuses and other forms of unlevel compensation. Four criteria must be met: 1. Any recommendation must meet the Impartial Conduct Standards, meaning that it must be in the best interest of the client, that all compensation the advisor receives as a result of the recommendation is reasonable and that the advisor makes no materially misleading statements. 2. Extensive disclosures must be made in writing to the client, including a written acknowledgement that the advisor acts as a fiduciary, specific descriptions of the services to be provided and a description of any major conflicts of interest. 3. All rollover recommendations must be specially documented and presented to the client before the transaction. The recommendation must describe the alternatives to the rollover and compare the investment options, fees and expenses, both in the current plan or arrangement and in the recommended IRA or other arrangement. The disclosure must explain why the advisor’s recommendation is in the best interest of the client and whether the employer pays for any of the administrative expenses. It should also compare the

The new guidance confirms that the DOL has authority to conclude what is “investment advice” for either type of retirement program so that it can properly evaluate whether a prohibited transaction has occurred. The IRS, however, remains the sole enforcer of the tax rules that affect IRAs. different services available in the current arrangement to what is recommended.

are made, who made them and what corrective action was taken.

4. The advisor must maintain effective policies and procedures to comply with the above and to mitigate any conflicts of interest. Prudent advisors will prepare to fully cover themselves while meeting the requirements of the investment advice rule exemption 2020-02, Shaw Elliott wrote. This includes:

6. Report annually the results of your compliance program to a senior executive officer appointed for this purpose who must certify that you have an effective program designed to maintain compliance with the Investment Advice PTE. Keep those records for six years. The DOL will likely request this report upon any audit.

1. Review all current disclosures, including Form ADV-2a, Form ADV-2b, Form CRS, 408(b)(2) reports and other documents to be certain that the proper disclosures, including of all conflicts of interest, are made.

7. All advisors should examine their investment advisory arrangements with care. The PTE provides protection for a broad range of conflicts, including conflicts arising from variable compensation, third-party compensation, proprietary products and principal trading. Be aware that these conflicts apply to both discretionary and nondiscretionary investment services, but the relief of the PTE is available only to nondiscretionary advice. Discretionary management is expressly excluded. Accordingly, advisors should take care to see that any conflicted discretionary management arrangements satisfy other exemptions or DOL guidance, or they will be left without any relief from prohibited transaction penalties.

2. Reassess all sources of compensation so that they may be disclosed. Check your own accounting records for payments you receive, 408(b)(2) disclosures, selling agreements and other documentation. 3. Prepare a new rollover form for each rollover type that specifically compares the current arrangement to the proposed arrangement regarding services, fees and expenses as well as the investments, plus lays out what the proposed arrangement is and why it is in the best interest of the client. 4. Revise compliance manuals to provide an effective program to meet the Impartial Conduct Standards, describe services and compensation, and acknowledge fiduciary status. 5. Test, track and maintain records of how effective your compliance program is. Include what kinds of mistakes

8. Train, train, train those at all levels of the firm to understand and appreciate the importance of these rules. InsuranceNewsNet Senior Editor John Hilton has covered business and other beats in more than 20 years of daily journalism. John may be reached at john.hilton@innfeedback.com. Follow him on Twitter @INNJohnH.

December 2021 » InsuranceNewsNet Magazine

Let’s reinvent the IMO, together. TruePay

“

$1.5 M

By working hand in hand with advisors, we’ve built the first end-to-end platform to help them manage every aspect of

”

their annuity business.

— Patrick Kelly

FINANCIAL ADVISOR, CEO & CO -FOUNDER, SIGNAL ADVISORS

F&G

1 day

6 day

15 days

North American

33 days

38 days

45 days

The first and only end-to-end platform for annuities.

7 innovations that came from listening to advisors

$5.2 M

$121,550

$583,000

$200,633

$57,000

$337,500

$200,317

7 6 5 4 3 2 1

Commissions Paid in One Day We pay commissions within 24 hours of receiving an application in good order.

1-Click Annual Reviews We remind you of all approaching annual review dates and, in just one click, you can download a client-facing annual report.

Inforce Opportunities We’ll help uncover opportunities in your existing book of business - just upload your policies and let us do the work!

Real-time New Business Updates Real-time status updates on NIGO issues, carrier approvals, transfers and more - all in one place!

1-on-1 Coaching from Top Advisors Get weekly coaching and real advice from $30M+ advisors who know how to grow a financial practice.

Real-time Commissions Dashboard Now you can sort and view commissions in real time, by policy, sub-advisor, date range and more.

No Marketers Rather than paying marketers to recruit, we are constantly finding ways to reinvest in our advisors.

Request a demo at

ReinventingTheIMO.com

INTERVIEW

life at the age of 42 and embarked on a journey to become an expert in leadership and in language. As he learned more about leadership, he realized he had failed the people who worked for him when he was a CEO. In his quest for business growth and leadership success, he neglected his relationships with those who helped build his company. He eventually learned the secrets of universal communication that uses emotional intelligence to drive connection, growth and performance. His book reveals ways that people can use language to communicate more authentically and improve their listening skills. And the lessons he teaches apply equally to the business world and the family environment. Ungerböck travels the world, speaking about the lessons of effective communication, often illustrating his talks with stories of his own successes and failures. In this interview with Publisher Paul Feldman, Ungerböck discusses what inspired his book and how you can be an inspiration to others on your team. PAUL FELDMAN: Can you tell our readers about your career and how it helped you write the book 22 Talk SHIFTs: Tools to Transform Leadership in Business, in Partnership and in Life?

Krister Ungerböck helps you transform words into tools to improve your business and your relationships. An interview with Paul Feldman, publisher

hat if there were an easy way to change your business team, change your relationships and improve your world? And what if that way was on the tip of your tongue? Bestselling author and leadership expert Krister Ungerböck understands that language can create confusion and misunderstanding. But it also can build bridges, 10

increase understanding and elevate the quality of all our relationships. The secret is to shift the way we talk to others. Ungerböck is author of The Wall Street Journal No. 1 bestselling book 22 Talk SHIFTs: Tools to Transform Leadership in Business, in Partnership and in Life. Before he wrote the book, he was CEO of a $200 million global event management software company. But he left the corporate

InsuranceNewsNet Magazine » December 2021

KRISTER UNGERBÖCK: Two elements of my career helped me write the book. One was running a successful software company that ultimately was valued at more than $200 million. The other was opening businesses in multiple countries and doing business outside the U.S. and in other languages. From a business side, Talk SHIFT helped me to have a multicultural understanding of different business cultures, how language plays into that, and some of the differences between language and words across cultures. When I left the business world, I surrounded myself with all the things and all the places that I wouldn’t have looked to find secrets back when I was a CEO. I looked for all the things that were more touchy-feely. I looked at the marriage counseling world in the new age; I looked at the spiritual world. My intention was always to keep my CEO hat on, and find out how can I translate some of those tools from those worlds into language that could be used in a business context. And that was how I formed Talk SHIFT. I took things from the business world

SHIFT YOUR TALK, CHANGE YOUR WORLD — WITH KRISTER UNGERBÖCK INTERVIEW and applied them to relationships and parenting, and I took things from the relationship and parenting roles and applied them to business. FELDMAN: What is Talk SHIFT? UNGERBÖCK: Talk SHIFT is a simple fill-in-the-blank phrase or question that can shift someone’s perspective and shift the course of a conversation. I was an engineer, and I started programming when I was 12. I always wanted to write a book, and I wanted to write simple things where as soon as you read one chapter, you could say, “I could use that tomorrow.” Just use this phrase. Boil it down. Simple, actionable tips. FELDMAN: Your book is a leadership book, but it pertains to all realms of life. UNGERBÖCK: I started out to write a business book. I think the original title was

going to be something like “Seeking CEO Secrets.” I admit I didn’t have a lot of passion around writing purely about leadership, but I was really interested in writing about leadership in the context of business. And I was more excited about how to write a leadership book that could work equally well in the context of leadership of a team and leadership in any relationship. That was a much more interesting

challenge for me. It ultimately was also something that benefited me personally, because I had read plenty of leadership books. FELDMAN: I took the Talk SHIFT assessment from the book, and it was eye-opening. It was something that made me realize that as a leader, we say a lot of things that are not helpful. UNGERBÖCK: When we started collecting data on this assessment, we found 90% of the people who took it were average or below. So we changed the scale for people who are doing the assessment online and showed people how they scored compared with their peers. And we found there are some powerful communicators out there. FELDMAN: You speak three languages but one of the parts of Talk SHIFT I liked was where you wrote about doing a presentation in French when you were just learning the language, and how learning a different language gave you a different perspective on something called "modal verbs." Can you explain modal verbs and what words to use instead of them? UNGERBÖCK: “Should,” “could,” “would” — these all are modal verbs. There’s a certain tense called the subjunctive. Anyone who has learned French will tell you their French teacher says you don’t need to learn that because it’s really a nuanced thing. This subjunctive tense is used when you’re making a recommendation or a judgment about something. So when we translate it into English, it sounds like “you should do this” or “you wouldn’t do this” or whatever. Even though this foreign language informed a lot of my book, I didn’t learn these things when I moved back here from Europe in 2007. Because language is such a habit, I never thought to apply some of these lessons to my native language, English. It wasn’t until I started writing the book book, and experiencing the events that led me to write the book, that I started thinking in my language. For example, instead of saying, “You shouldn’t do this,” or “You must do this,” just drop the “You should.” Instead of saying, “You should come to work early,” just say, “Come to work early.” Now you can make a command by dropping the “you

should” or if you want to soften it, you can say, “Please come to work early.” Or instead of saying, “You should get the project done on time,” turn it around into a question and say, “Would you consider getting the project done on time?” Depending on the context of the situation, asking a question may be more appropriate. FELDMAN: Where do you see Talk SHIFT making a difference in sales? UNGERBÖCK: I think it can be more around questioning someone instead of telling someone. Ask them, “On a scale of 1 to 10, how committed are you to solving this problem?” Mostly because it diffuses. If I ask, “Are you ready to solve this problem? Are you ready to buy?” If someone subconsciously answers no in their head, they may not tell me that; they may say yes instead. Here’s an example I use in the book. I could say, “Do you think our communication is good? Or say, “Do you think you’re going to buy my product? Are we going to solve this problem in the next six months?” Similarly, we as leaders might say, “Do you think I’m a good boss?” Or we might ask our spouse, “Do you think we have a good marriage?” And having a yes/no question like that is where someone’s probably not going to say anything other than yes. But what happens when they say no in their head, when you kind of solidified the no for them? Because no may not be a socially acceptable answer in that situation, maybe they feel pressured to say yes. “Am I a good boss?” “Do we have good communication and a good relationship?” “Do you want to solve this problem?” Flip that and say, “On a scale of 1 to 10, how committed are you to solving this problem?” “On a scale of 1 to 10, how good is our communication?” And ultimately, asking, “How good is our communication?" is a great proxy for asking how good your relationship is with someone without asking them how good your relationship is. Because if your communication is bad, your relationship is bad. In some cases, I recommend exaggerating the scale. So I’m asking, “On a scale of 1 to 10, how committed are you to solving this problem? With 10 being like there’s nothing more important than this problem and it needs to be solved tomorrow,

December 2021 » InsuranceNewsNet Magazine

INTERVIEW SHIFT YOUR TALK, CHANGE YOUR WORLD — WITH KRISTER UNGERBÖCK and 1 being it’s not important at all.” And then let’s say the answer is a 7 or a 6. So we say, “What can we start doing or stop doing to go from a 6 to a 9 or a 10?” to physically move it up the scale. Now we start to help people identify their own path of step-setting in a sales environment. Instead of saying “What can we start or stop doing to make a difference between a 6 and a 9?” how about saying “How committed are you to solving this problem?” What are the obstacles that are the difference between a 6 and a 9?” I think in a sales context, where a lot of Talk SHIFT applies, if people can come up with their own solutions to problems, then they are more committed to making those solutions happen. So we can ask them the questions that move them to conclude that our solution is best, or that we need to take action more quickly than they would have done otherwise. FELDMAN: What about asking leading questions? UNGERBÖCK: The leading question is usually one where you’re leading someone to the answer. They are almost always yes/ no questions. But they’re usually solutions disguised as questions such as, “Do you think that reducing your employee turnover would help you with this problem?” “Do you think that buying this software would help you to reduce your turnover?” Those are leading questions. And people see through them fairly quickly. FELDMAN: How does the English language get in the way of communicating? UNGERBÖCK: Here’s an interesting thing: If you look up the word “to feel” in French, the word is “sentir.” And if you looked up “to think,” in a French thesaurus, you would not see the word “penser,” which is “to think” as a synonym for the word “feel.” But if you look up “feel” and “think” in an English thesaurus, they are synonyms. So often, what happens is, I’ll say something like, “I feel.” “I feel like you were trying to hurt me” or “I feel like you betrayed me” or “I feel like I was run over by a bus.” And whenever I say, “I feel that” or “I feel like,” the words follow our emotions. I started using the words “I feel” more frequently, and I thought I was talking about my emotions. But I was always 12

VOCABULARY OF NEEDS When speaking of needs, It’s important that we have a clear vocabulary of psychological needs. Below is the list of core needs. • Someone’s need for CONNECTION may be expressed using the words acceptance, appreciation, belonging, friendship, love, trust, respect, security, stability, support, to understand, or to be understood. • Someone’s need for AUTONOMY may be expressed using the words freedom, independence, space, or spontaneity. • Someone’s need for HONESTY may be expressed using the words authenticity or integrity. • Someone’s need for PLAY may be expressed using the words fun or humor. • Someone’s need for PEACE may be expressed using the words ease, equality, harmony, inspiration, or order. • Someone’s need for MEANING may be expressed using the words awareness, challenge, competence, contribution, creativity, growth, or hope. • Someone’s need for PHYSICAL WELLBEING may be expressed using the words food. sleep, shelter, sexual expression, safety, or touch. Krister Ungerböck, 22 TalkSHIFTS: Tools to Transform Leadership in Business, in Partnership, and in Life. ©2020 Lioncrest Publishing

saying, “I feel like,” “I feel that,” and I really was just talking about thoughts. Those thoughts typically don’t create more connection. The antidote is to say, “I feel,” and then have the next word always be an emotion. For example: “I feel sad,” “I feel angry,” “I feel afraid,” “I feel hurt,” “I feel guilty,” “I feel embarrassed.” When we start conversations this way, now it creates a different conversation. If I start with thoughts disguised as feelings, those thoughts often can be judgments. I think that, in a business context, the most common emotion that many leaders experience is anger. There’s kind of a subtle thing that happens if a boss or a leader says to someone who works for them, “I am angry” or “I feel angry.” That typically puts the other person into a state of fear. And when we’re in a state of fear, neuroscience

InsuranceNewsNet Magazine » December 2021

tells us that the part of our brain responsible for problem-solving shuts down. Let’s say somebody is doing a poor job on a project or they turn a project in late, and I say, “I’m angry with you.” What I’m doing as a leader is putting the other person in a mental state where they’re less likely to be able to solve the problem that caused me to be angry in the first place. But I can have a different conversation. I can say, “I’m scared about what’s going to happen if we don’t get that project on time. I don’t know what that will mean for bonuses. I don’t know what that will mean for our customer service,” or whatever it may be. Now that’s a different conversation. Even if I said, “I am embarrassed because the project was late,” if you and I have a good relationship and you respect me as a boss, and you want me to be successful and you believe I’m looking out for you, then you probably don’t want me to be embarrassed, right? Now, if you do want me to be embarrassed, then that’s a whole separate conversation and we have a broken relationship. But assuming we have a reasonably good working relationship, having a conversation about the emotions behind the words is a much more productive approach, and you have some tricks to quell your fear. FELDMAN: If you tell someone you’re angry, how do you make that more than just a command or a statement to someone? UNGERBÖCK: It’s really about psychology. Many psychologists say anger is not a primary emotion; it is a core emotion. So there’s a subtle nuance in language there. But anger is a secondary emotion, meaning that another primary emotion is always behind our anger. And those emotions are sadness, hurt, guilt and shame. “Embarrassment” is another word for “shame” or “fear.” Whenever we feel anger, we can ask ourselves, “What’s the emotion?” What emotion am I experiencing beneath my anger? I always try to make it a multiple-choice question: sadness, fear, shame, embarrassment, anxiety, guilt or hurt. The reason I do it as a multiple-choice question is that when people first started asking me about this, I wasn’t able to pick any of those emotions, because I was so out of touch with my emotions. But I may have

SHIFT YOUR TALK, CHANGE YOUR WORLD — WITH KRISTER UNGERBÖCK INTERVIEW felt “sadness,” but I wouldn’t use the word “sadness.” So I would pick a word that’s closer to what I feel and ask, “What’s a synonym for that?” Maybe “fear” is a word that’s closer to what I feel. But I might be afraid to say the word “fear,” so I would say I feel “anxiety” or “stress” because those are more corporateaccepted words. Because when I asked business leaders and executives what emotions they were experiencing, they would say, “I was frustrated.” That’s just a synonym for “anger.” So I would ask, “What’s another word like that?” and they would say, “I was disappointed.” Well, that’s just another synonym for “anger.” So when we kind of get beyond those initial responses, sometimes even the word “stressed” can be a synonym for anger. FELDMAN: In sales, we must listen more than we speak, and we must ask really good questions. You say we must listen for needs. Can you explain? UNGERBÖCK: If you’ve ever seen that person who talks too much in meetings, or if a salesperson is doing more of the talking within a sales context, it’s often illustrative of a deeper need within themselves, or even a fear that they’re going to lose the deal, right? The more we’re afraid we’re going to lose the deal, the more we start talking, and then people can feel it. But in a broader context, listening for needs can be a great way to reframe, and to shift and change our perspective. So let’s say someone is talking about their accomplishments. And then we ask, why does someone feel the need to talk about their accomplishments? Maybe it’s because they have some insecurity within themselves that they’re trying to overcome; that’s why they’re talking about their accomplishments. Maybe it’s because they don’t have anyone else who’s giving them positive feedback about their accomplishments. But sometimes if we reframe those annoying behaviors to understand what need they could be feeling, we can start to get an insight and develop more compassion for someone’s behavior, instead of thinking we don’t like that person. FELDMAN: I really liked the part in your book where you give the three secret words to inspire followers: “Do something inspiring.” Tell us more about it.

UNGERBÖCK: I used to read a lot of motivational books and study ways I can motivate people with inspiring speeches. And when I give speeches, it’s my hope that I do inspire people. But inspiring an employee on a day-to-day basis is another thing. There’s a story in the book about one of my closest friends. He has multiple sclerosis, but he ran a 140-mile ultramarathon three years after he was diagnosed. Following him and seeing the roller coaster of emotions that he went through and the grit that was required to do that inspired me. So I ran a half-marathon and I finished it, but I walked most of the way. But I’m more proud of that than I am of any business accomplishment I ever had. It wasn’t until I left my business that I realized I was fortunate to attract some really capable people, and we had employee engagement rate levels of 99.3%. But I also realized that people followed me because of my vision to build a billion-dollar company. If you go to somebody who’s a go-getter executive and say, “My vision is to build a billion-dollar company, and I can show you I’ve been on track to do that,” that’s pretty inspiring. However, there are only one or two people in any organization who can talk about the organization’s vision and use that as a tool to inspire people. People didn’t want to follow me as an individual; they wanted to follow the vision. I realized that being someone who others want to follow, along with having a vision, is a powerful combination. FELDMAN: In your book, you say criticism is lazy leadership. How can an entrepreneur or business owner do better when it comes to criticism? UNGERBÖCK: If there were one thing that I regret the most, it’s that I led with criticism. I always felt my job was like, if someone got a 99% on a test, my job was to tell them about the 1% they got wrong. When I was a CEO, one of our people really worked hard on a project. He spent two or three weeks on it and worked late hours, and he did a good job. And all I told him about was the two or three things that I didn’t like. He was totally deflated. He was like, “What’s the point of working 50, 60 hours a week if the only thing I’m going to hear about is what’s wrong?” And he actually knew about these two or three problems anyway, so I was telling him

what he already knew. What I learned is that I didn’t know the language for giving people positive feedback. Now I find myself much more frequently saying, “I just want to acknowledge that you worked hard,” or “I want to acknowledge the changes that I’ve seen,” and then separating any negative feedback, addressing it in a separate conversation that can be an hour later, or it can be the next day. But I also had someone bring me a report they had been working on for a while. I was really busy that day and didn’t get a chance to read it. So we met later to review it, and I asked, “What are the three biggest things that you think need to be improved?” And the person said, “It’s this, this and this.” I said, “Why don’t you work on those three things, and then let’s meet next week?” I went from what would have been an hourlong meeting that would have walked them through those same three things they already knew, and cut it to a 60second conversation. FELDMAN: How do we Talk SHIFT? UNGERBÖCK: When I started thinking about the way we talk, I began to think about how anger is such a powerful emotion. Listening for needs is important, but if someone is angry with me, there are ways to reframe our own thinking by asking the same questions of ourselves. I did a weeklong intensive French class, and I asked my teacher how you learn French quickly. And his answer was to practice it everywhere you go. It’s the same with Talk SHIFT. You can pick up some of the Talk SHIFTs and practice them with the people around you. When you ask people what’s the most important thing in their lives and they say it’s their marriage or their children, or when you ask them what their biggest problem is and they say it’s their teenagers, these are places they can practice Talk SHIFTs. Then what happens is that it kind of rubs off, and you end up using it at work as well. I’ve had 75-year-old grandmothers tell me they are experiencing Talk SHIFT with their children who are in their 40s and having challenges in their relationships. And for me, that is being able to have a tool that people can use equally to transform their communication, their broader family and the culture.

December 2021 » InsuranceNewsNet Magazine

the Fıeld

A Visit With Agents of Change

MARK SQUIRES made a name for himself as “The Medicare Whisperer,” but his practice serves the Medicare generation’s children and grandchildren as well. BY SUSAN RUPE

Filling the generational pipeline 14

InsuranceNewsNet Magazine » December 2021

FILLING THE GENERATIONAL PIPELINE — WITH MARK SQUIRES IN THE FIELD

ark Squires was 42 years old when he decided what he wanted to do when he grew up. He found his calling — to make sure no one else has to deal with what he faced after he lost everyone in his family except his children over the course of seven years. Today, Squires is president and CEO of Wise Choices Financial, an Independence, Mo., financial services firm he founded in 2002 that has grown to a team of seven professionals. But prior to becoming an advisor, he worked in the trucking industry and eventually became parts manager of a trailer dealership. His father’s death during that time left Squires with some jagged financial pieces to pick up. “As the youngest child in the family, I was the person who had to deal with everything — Medicare, Medicaid, veterans benefits,” he recalled. “That was quite a challenge because my dad was a Merchant Marine during World War II, and the Merchant Marine benefits were completely different than they were for other World War II veterans. And then I had to deal with pension plan elections, 401(k) payout options, estate planning done horribly wrong.” Settling his father’s estate took so much effort that Squires found he couldn’t continue working in his parts manager job and take care of his father’s estate at the same time. So he returned to his family’s trucking business for awhile. During this period, Squires’ brother was killed in a car accident and Squires also became a single father of two while serving as caregiver to his former father-in-law during his last 13 months of life. “When this period of my life was over, it occurred to me that maybe God put me through this experience for a little higher calling, because somehow he wired my brain to understand the complexities of all of this,” Squires said. “After everything was done, I decided that I wanted to help people navigate the waters that I navigated without any help at all.” Squires studied for the appropriate licenses, passed the exams and decided he wanted to become an independent advisor. “The reason I wanted to be independent? I’ll give you an example. If I want to sit down with an 86-year-old woman and spend an hour and a half talking with her about her garden and not try to sell her something, I don’t need a manager out of state yelling at me about that. And that 86-yearold woman just turned 101 this year. She has been my client for years and so have her children and grandchildren. And if you ever talk with her, she will tell you the reason she chose me is because I never asked her about her money.”

The Medicare Whisperer

Squires has a passion for serving the Medicare market, and Medicare makes up a big part of his practice. He trademarked the name The Medicare Whisperer, and he has become somewhat of a local celebrity, discussing Medicare on radio talk shows and in a series of YouTube videos. “As The Medicare Whisperer, I have a fairly sizable presence in the Medicare market in the Kansas City area,” he said. “I have a team in my practice that is focused purely on educating and advising people in the world of Medicare and in selling Medicare. We solve problems. But whatever the need is, we’re here for more than just the sale. If we have a client who has a question or a problem, we don’t tell them to call the toll-free number on their Medicare plan card unless we have to. We will get involved, and we will educate our clients.” Steve Kuker is the founder of Senior Care Consulting and is the host of a local radio show, “Senior Care Life.” Squires is a frequent guest on his show, and Kuker calls him “the most knowledgeable person about Medicare I’ve ever met.” “I took my own mother to meet with him about her Medicare coverage, and he was able to get her in the right plan and save her money in the process,” Kuker said. But Medicare is only one of three different divisions at Wise Choices Financial. Squires doesn’t want to serve only the 65-and-older crowd. He wants to serve clients of all age groups and help set them up for financial success. “Our mission is to help people, change lives and simplify the complex,” he said. “And to be a lifetime advisor. We routinely tell clients when we onboard them, this is not a one-and-done for us. We have a responsibility to you, and we’re looking for a lifetime relationship. We’re not looking to make a quick sale and move on. We want to be a part of your life. We want to know about your children, your grandchildren, your great-grandchildren.”

Walking A Tightrope

Squires takes aim at the 55-plus age demographic by advising them on what he calls “the pillars of your financial life.” Serving that age group is the focus of the second division of his practice. “We educate people and help them set up their estate plans, their retirement income plans,” he said. Squires likens investing and saving for retirement to walking a tightrope. “Walking on a tightrope could be a thrilling and life-changing experience, or it could be a horrifying and deadly experience,” he said. “It depends on two variables. One is how high the tightrope is from the floor. That’s what we call your risk tolerance. The second variable is how good your coach December 2021 » InsuranceNewsNet Magazine

the Fıeld

A Visit With Agents of Change

is. If your coach is Nik Wallenda, the first person to walk a tightrope across Niagara Falls, you’re going to have a little more confidence in what he’s telling you. “Well, I function as the coach as a financial advisor. But I believe the most important variable is how big and how well-anchored your safety net is. That’s where we start talking about end-of-life planning.” Although he said end-of-life planning is “kind of an odd thing to talk to a 55-yearold about,” Squires said he tries to inject some fun into the discussion as he knows it is one of the major concerns retirees have.

25-year-old client and show them how to relieve themselves of debt by just paying another bill. All they’re doing is paying another bill. And then we show them how to use that as their own bank, how to give every dollar four jobs to pay off their debt. For the average client who doesn’t have a mortgage, we have them out of debt — including credit cards, consumer loans, student loans and car loans — in about 2.9 years. For those who have a mortgage, we can have most people completely debt-free in nine years or less, and we do it without significantly changing their spending habits. “It’s quicker than they ever dreamed possible, and they save thousands of dolDebt Free Destination lars of interest. Then we show them how Over the years, Squires’ older clients would to turn that around. We teach a lot about refer their children and grandchildren to compound interest and how it works. We him. As he helped them sort through their teach them how they can build assets that financial goals — whether it was saving for will serve them for life. And it’s the most their children’s education or saving for a wonderful part of our business that I enjoy.” house — he found most of these younger Squires also began hosting a podcast clients had one thing in common. called “Adulting Done Right,” which is aimed at young adults. He is a fixture on YouTube, “I tried to figure out how I could teach people and assist producing videos on a them in setting up A PLAN TO GET OUT OF DEBT THAT variety of financial topics DOESN’T REQUIRE THEM TO EAT BEANS FOR EVERY MEAL or deliver pizza every evening after they work their regular with real-life applications. job because people aren’t going to stick with that.” “We’ve been talking about things such as what “The first thing we looked at was their to do if you lose your job, how to write a overwhelming debt, most of which is stu- resume,” he said of the podcast series. “We dent loans,” he said. will have some of our friends who are in He began to research ways to help young the real estate business and the mortgage adults get out of debt and found that al- business coming on to our video series to though there are many ways to become talk about how to prepare to buy a house. debt-free, most of those methods call for We’re constantly educating people on what severe financial sacrifices that few people resources are available.” are willing to make for very long. When he isn’t advising clients or prepar“Most people aren’t willing to do any- ing for his next video, Squires enjoys garthing draconian for more than three dening and landscaping around his home. months,” he said. “So I tried to figure out He and his wife are active in their church. how I could teach people and assist them He believes his work is a mission to help in setting up a plan to get out of debt that people change their lives. doesn’t require them to eat beans for every “I didn’t get into this business to make meal or deliver pizza every evening after a million dollars,” he said. “I want to walk they work their regular job because people the journey of life with my clients and be aren’t going to stick with that.” there for them every step of the way.” The Debt Free Destination was born, and that is the third division of Squires’ practice. Susan Rupe is maneditor for The plan centers on helping the partici- aging InsuranceNewsNet. She pants find their inefficient dollars and redi- formerly served as comrect those dollars into a monthly account, munications director such as a whole life policy, and use the ac- for an insurance agents’ cumulated cash value to pay off their debt association and was an award-winning newspaper reporter and editor. Contact as efficiently as possible. her at Susan.Rupe@innfeedback.com. “What we’re able to do is take a Follow her on Twitter @INNsusan. 16

InsuranceNewsNet Magazine » December 2021

1. VUL Defender ranks #1 85% of the time for lifetime and guarantees to A100. Average premium ranking based on combined averages for VUL Defender and Eclipse Protector II IUL against top competitors for the following scenarios: lifetime no-lapse guarantee, ages 20-70, male/female, Preferred Best, Preferred and Standard underwriting classes, full, ten and single pay, death benefit amounts of $250,000, $500,000 and $1M. Companies/products included: Lincoln Financial: VULOne Nationwide: VUL Protector Pacific Life: Pacific Admiral VUL Penn Mutual: Protection VUL Prudential: VUL Protector Securian Financial: VUL Defender Securian Financial: Eclipse Protector IUL Nationwide: IUL Protector II 2020 North American: Protection Builder IUL Symetra: Protector IUL 3.0 This comparison does not take all material factors into account and must not be used with the public. These factors include but are not limited to: applicable separate account and indexed account options, rider availability, surrender periods, or fees and expenses. For information regarding these and other factors please consult each company’s respective prospectus. Product features and availability may vary by state. Variable products are sold by prospectus. Your clients should consider the investment objectives, risks, charges and expenses of a portfolio and the variable insurance product carefully before investing. The portfolio and variable insurance product prospectuses contain this and other information. A prospectus can be obtained at securian.com Please keep in mind that the primary reason to purchase a life insurance product is the death benefit. Insurance policy guarantees are subject to the financial strength and claims-paying ability of the issuing insurance company. Variable life insurance products contain fees, such as mortality and expense charges, and may contain restrictions, such as surrender periods. There may also be underlying fund charges and expenses, and additional charges for riders that customize a policy to fit individual needs. Charges and expenses may increase over time. The variable investment options are subject to market risk, including loss of principal. Uncapped indexed account participation rates are subject to change and may be less than 100%. This could have the impact of the indexed account credit being less than the change in the reference index. Agreements may be subject to additional costs and restrictions. Agreements may not be available in all states or may exist under a different name in various states and may not be available in combination with other agreements. These materials are for informational and educational purposes only and are not designed, or intended, to be applicable to any person’s individual circumstances. It should not be considered investment advice, nor does it constitute a recommendation that anyone engage in (or refrain from) a particular course of action. Securian Financial Group, and its subsidiaries, have a financial interest in the sale of their products. Insurance products are issued by Minnesota Life Insurance Company in all states except New York. In New York, products are issued by Securian Life Insurance Company, a New York authorized insurer. Minnesota Life is not an authorized New York insurer and does not do insurance business in New York. Both companies are headquartered in St. Paul, MN. Product availability and features may vary by state. Each insurer is solely responsible for the financial obligations under the policies or contracts it issues. Securities offered through Securian Financial Services, Inc., member FINRA/SIPC, 400 Robert Street North, St. Paul, MN 55101-2098, 1-800-820-4205. Securian Financial is the marketing name for Securian Financial Group, Inc., and its subsidiaries. Minnesota Life Insurance Company and Securian Life Insurance Company are subsidiaries of Securian Financial Group, Inc. For financial professional use only. Not for use with the general public. The information presented above is solely intended for use by financial professionals. Such information is not intended for public consumption or dissemination.

INSURANCE INVESTMENTS

Insurance products issued by Minnesota Life Insurance Company

RETIREMENT

Want #1 ranked protection products? We’ve got you covered. With Variable Universal Life Defender (VUL Defender®), you can offer clients highly ranked, guaranteed protection with: • Competitive premiums Ranked #1 3 out of 4 times for lifetime guarantees1 • Flexibility in times of uncertainty Chronic Illness option, capped/uncapped indexed accounts, 70 subaccounts • Hassle-free, digital experience From application, underwriting to delivery (with WriteFit UnderwritingTM) Not variable licensed? Ask about Eclipse Protector II Indexed Universal Life.

Learn more Visit securian.com/VULDefender or call us at 1-888-413-7860, option 1

Learn more

December 2021 » InsuranceNewsNet Magazine

NEWSWIRES

Why Aren't They Returning To Work?

Millions of laid-off workers have yet to return to the job market even though there are near-record job openings. Enhanced unemployment benefits ended nationwide on Labor Day, and so far the evidence suggests that additional money didn’t play a big role in keeping workers on the sidelines. So why aren’t people coming back to work? A number of factors are at play, according to economists. They include COVID-19 health risks, early retirements, caregiving duties and built-up savings. A record 4.3 million people quit their jobs in August. Front-line workers in sectors like restaurants, bars and retail quit at the highest rates, which lends credence to the idea that fear of contagion and hazards of in-person work are playing a role. Meanwhile, workers in the 55-plus age bracket account for 89% of the increase in those who aren’t looking for work right now. Economists said older workers may have opted to start drawing Social Security and live off their nest egg instead of taking a health risk at work. Those who have caregiving responsibilities and can’t work from home also have opted out of the workforce for now. And finally, households amassed record savings during the pandemic, with cash balances up 50% in July over the previous year, according to the JPMorgan Chase Institute. People who have a little extra in the bank may decide they don’t have to take a job at the moment.

FED STARTS TAPERING BOND PURCHASES

The Federal Reserve made a long-awaited announcement that it would begin to unwind one of its biggest and most unprecJerome Powell edented market interventions undertaken in the wake of the pandemic. The Fed said it would start tapering bond purchases in November, a process that will involve a $15 billion monthly reduction from the current $120 billion a month it previously was buying. Meanwhile, the Fed announced it would continue to keep interest rates at near zero. Fed Chairman Jerome Powell described the current inflationary climate as “transitory,” although he also acknowledged that the supply chain disruption had created “sizable price increases” in some parts of the economy. Since June 2020, the central bank has been purchasing $120 billion in bonds DID YOU

KNOW

— $80 billion in Treasuries and $40 billion in mortgage-backed securities — every month to add liquidity and keep the financial system working efficiently. Powell said that the Fed would begin reducing those purchases by $10 billion and $5 billion, in November. The Fed will continue to step down by those increments, though Powell said the bank was “prepared to adjust the pace of purchases if warranted by changes in the economic outlook.”

ALLSTATE SELLING CORPORATE HEADQUARTERS

The work-from-home phenomenon has claimed the long-term corporate complex for one of the nation’s leading insurers.

QUOTABLE

The labor market hasn’t fully recovered yet. — Lawrence Gillum, fixed income strategist for LPL Financial

Allstate is putting the For Sale sign on its Northbrook, Ill., headquarters as 95% of its employees continue to work remotely. Allstate has been a corporate fixture in Northbrook since 1967, when it moved its offices from Skokie, Ill., to a six-building complex on a 122-acre campus. The company’s existing office space in Chicago will continue to be available to employees. Allstate has more than 7,800 employees in Illinois and more than 44,000 across the U.S.

LIFE EXPECTANCY IN US FALLS SHARPLY

Life expectancy for U.S. men dropped by 2.3 years in 2020 — from 76.7 to 74.4. Women’s life expectancy fared slightly better — dropping by 1.6 years, from 81.8. to 80.2. Only Russia saw a greater drop in expected life spans. The U.S. had the second-steepest decline in life expectancy among high-income countries during the pandemic, according to the British Medical Journal. One surprise: The drop in life expectancy in the U.S. was driven by the deaths of young people, said Dr. Nazrul Islam, a researcher at the University of Oxford. COVID-19 was a factor, but it was not the only one. Drug overdose deaths and homicides also increased during 2020.

33% of Americans said the pandemic triggered conversations with close family members about end-of-life plans. Source: LIMRA

Source: National Association for Business Economics

InsuranceNewsNet Magazine » December 2021

Source: Edward Jones

Special Sponsored Section

JOIN US IN OUR SEARCH FOR THE “ONE” We’ve surveyed the industry to find ONE Individual, Carrier, IMO/ BGA, Technology or Product that is disrupting the status quo and shaping the future of the insurance industry.

INSIDE Introducing CareAssist: A Win-Win Benefit for Employers and Employees with Jeffrey Parrish of Resolution Reinsurance PAGE 20

Innovation Is Driving Force for Security Benefit with Mike Kiley, CEO of Security Benefit PAGE 21

2021 Movers & Shakers • Featured Product • Special Sponsored Section

Introducing CareAssist: A Win-Win Benefit for Employers and Employees

hey may not always admit it, but chances are your employees are thinking about a child, an elderly parent or a disabled spouse — someone for whom they are responsible. Today, 73% of U.S. employees are caring for a child, parent or friend.1 When a regularly scheduled caregiver suddenly becomes unavailable, it places a burden on the employee. Undue anguish and stress, distractedness, decreased productivity and, inevitably, absenteeism are frequently the results. CareAssist from Resolution Reinsurance Intermediaries is an affordable solution.

How it works

For less than $25 a month per employee, CareAssist gives employees up to 10 days of backup care per year using Care.com’s network of vetted in-home and in-center providers to find care for children and adults. They also get unlimited access to a premium membership on Care.com’s Jeffrey Parrish platform to find regular care for children, adults or pets; locate tutors; and more. With these two services you can help your employees find care for their planned needs, and backup care when regular care is not available. “Whether you have existing regular care arrangements or hire regular help through the Care.com platform, CareAssist fills the gap when that care falls through,” says Jeffrey Parrish, vice president of sales and marketing for Resolution Reinsurance Intermediaries (ResRe), the Columbia, South Carolina-based health, accident, and property and casualty reinsurance broker that created CareAssist.

The caregiving crisis

According to a 2019 study by Ready Nation, child care needs alone cost the nation nearly $57 billion annually in lost earnings, lost productivity and lost revenue. Moreover, roughly 10,000 Americans turn 65 every day, according to Home Health Care News — and some 70% of them need long-term assistance with everyday tasks. The U.S. Centers for Disease Control and Prevention estimates that at least 20% of adults age 45 or older currently provide care for a loved one. The need is so great that some experts are calling it a “caregiving crisis.” Yet fewer than 1-in-5 of employers offer any kind of backup care for their employees.2 “Caregiving needs — especially the unexpected ones — put people in a bind,” says Parrish. “That’s why we created CareAssist.”

their mental health. Many employees have to use vacation days for caregiving, which can lead to burnout. For employers, that means high absenteeism and constant turnover. In fact, 61% of employers consider caregiving benefits to be a top priority, and 84% believe that having a caregiver-friendly workplace is important for retaining and attracting talent. They just don’t know how to provide it. CareAssist is a costsaving answer.

Phenomenal benefits

According to a report from Harvard Business School, the advantages of easing the distractions, doubts and fears around caregiving are nothing short of phenomenal: 80% improved morale.

70% increased productivity.

70% less turnover.

60% greater profitability.

These are benefits every employer wants.

It’s what employees want, too, but can rarely find

Some jobs may provide child care or paid family leave, but most of those have limits and can be expensive. CareAssist is unique in that it … • Addresses a broad spectrum of caregiving — child care, adult care and elder care. • Is prepaid like other core benefits packages, so it’s always there if needed. “Employers need a differentiator to recruit and retain talent,” says Parrish. “Those who offer CareAssist will find it easier to hire and keep good people.”

Plan for the future

As the population keeps aging, the need for caregiving will only increase. CareAssist can help you keep up. It’s the kind of benefit that all employees will be looking for in the future, but that only the best employers will provide. “Be ahead of the market as it evolves and demand grows,” says Parrish. “CareAssist is a cost-effective win-win for employers and their employees alike.”

Visit CareAssistWinWin.com for more information and your free product overview.

More than two years in the making

ResRe began designing CareAssist more than two years ago. The company built it to help people be whole during caregiving emergencies, and to keep businesses running smoothly. Employees who are worried about loved ones aren’t at their best. The stress takes a toll on how they do their job and on 1 Joseph B. Fuller and Manjari Raman, “The Caring Company.” Harvard Business School, Jan. 17, 2019. 2 Care.com, (2021). The Workplace Culture and Care Report. https://benefits.care.com/workplace-culture-and-care-report

InsuranceNewsNet Magazine » December 2021

717.441.9357

www.InsuranceNewsNetMagazine.com

2021 Movers & Shakers • Featured Carrier • Special Sponsored Section

Innovation Is Driving Force for Security Benefit Mike Kiley, Chief Executive Officer, on how Security Benefit disrupted the staid insurance segment and went on a tear in the past decade, quintupling assets and helping usher in a new era of innovation.

hile we didn’t set out to reshape the U.S. retirement space, we ended up doing just that. In 2010, we took action to rebuild and allow the company to recover from the financial crisis of 2008. The first year was critical—we gave our people the chance to step up—and they did. We changed up how we approached the market, and set some clear priorities around our business model that played out successfully in the decade following. That included our effort to expand both the product line and distribution reach, while introducing some innovations. We took advantage of ongoing market trends that saw an aging population (but with people living longer), constrained retirement saving (leading people to be afraid of outliving their savings) and an historic low rate environment, coupled with high market volatility. Our revamped product mix was strategically positioned to meet the challenges these trends created. Among our accomplishments: • We were the first to deliver custom index account options in our fixed index annuities in 2012

with a select set of independent financial professionals, and the industry’s leading independent marketing organizations (IMOs), that drove our growing sales volume. We started our turnaround coming off one crisis, only to end this decade with another one. COVID has presented a unique, modern-day challenge but Security Benefit is not new to disasters. This wasn’t our first pandemic, having faced the severe flu outbreak of 1918. When COVID hit, our people took decisive action, shifting the entire firm into a fully connected, remote working environment. Forward thinking helped prepare us for the unexpected, by putting in place critical technology solutions and partners we could rely on. We built partnerships with a select set of independent financial professionals, and the industry’s leading independent marketing organizations (IMOs), that drove our growing sales volume.

• We became the creator of a new annuity product category, floating rate annuities, in 2016 • Developed our first commission-free FIA for the RIA market in 2019 with DPL Financial Partners • Launched a new mobile app and financial wellness platform for DC participants in 2019 • Launched an institutional-level open architecture DC platform in 2020 • Launched a series of accumulation-focused FIAs to meet short and long-term retirement needs in 2020 • Ranked by LIMRA as one of the top four 403(b) companies in the K-12 education market as of 2020 • Developed a multi-factor index in 2021 that is now distributed by S&P and featured in multiple FIAs We matched our disruptive product development effort with a refocused distribution strategy that turned the traditional model upside down — putting the focus on our sales desk instead of field staff. We also picked up on another trend some of our competitors missed: advice still sells. We built partnerships

This kept momentum strong as our fixed annuity (MYGA and FIA) sales increased nearly 70% year-over-year in 2020. Challenging the status quo is in our DNA. When we were founded in 1892, we were one of the first companies to create an insurance fund for those who otherwise couldn’t afford it. Today, we are fully focused on the retirement market across a broad range of wealth segments and have nearly quintupled our assets under management in the past decade to nearly $50 billion (as of June 30, 2021). Our unique and timely approach confirms that after almost 130 years, we are not running out of good ideas.

Find out more about what we can do for you at SecurityBenefit.com.

The annuity products referenced are issued by Security Benefit Life Insurance Company (SBL). SBL does business in all states except NY.

December 2021 » InsuranceNewsNet Magazine

717.441.9357

www.InsuranceNewsNetMagazine.com

COVER STORY

CAN THE INDUSTRY MAINTAIN THE

MOMENTUM

More Americans recognized the value of insurance products in 2021, but can the industry ride that wave into the coming year?

Life Insurers: Lessons From The Past, Looking Toward The Future • p23 VAs Back From The Dead And Rising Fast • p25 Health Insurance: Stabilized Premiums Despite Nursing A ‘Hangover’ • p26

InsuranceNewsNet Magazine » December 2021

CAN THE INDUSTRY MAINTAIN THE MOMENTUM? COVER STORY

Life Insurers: Lessons From The Past, Looking Toward The Future COVID-19 made consumers more aware of their mortality and more aware of why they need life insurance. But can the industry keep that momentum going in 2022? BY SUSAN RUPE

ill the life insurance industry see a repeat of what happened after a historic pandemic swept the world about a century ago? As life insurers ride a wave of increased sales in the wake of COVID-19, one industry leader looked to the Spanish flu pandemic of 1918-19 and expressed his hope that a post-pandemic sales slump won’t be around the corner. COVID-19 made consumers more aware of their mortality and more aware of why they need life insurance. The result: in the first half of 2021, life insurance sales reversed a decadeslong slump to rise to their highest level in nearly 40 years. In the first six months of 2021, the total number of policies sold increased 8%, compared with prior-year results. This is the highest policy sales growth recorded since 1983. But can the industry keep that momentum going in 2022? Or will consumers go back to complacency and reluctance about buying coverage? David Levenson, president and CEO

of LOMA, LIMRA and as we go into the coming LL Global, noted that the year.” Spanish flu pandemic inLevenson cited research spired a similar spike in life that found eight out of 10 insurance sales followed by insurers who implemented a sales slowdown in 1921digital processes or strat22. But he is optimistic that egies plan on expanding history won’t repeat itself them in the future, and he as the world emerges from predicted consumers will be COVID-19. the winners. “This is making Levenson “Our data tells us there the buying process easier are still a lot of people out there who and faster. Meanwhile, coverage remains are likely to buy life insurance,” he told cheaper than most people think it is.” InsuranceNewsNet. “There’s more of an awareness. People are seeing the value of Product Trends: UL Products life insurance.” Catching Up Life insurance sales will continue to in- Levenson predicts growth in life sales crease but at a slower rate, Levenson said. across the board, but some products may But COVID-19 will not necessarily be see more growth than others. the driving force behind increased sales, “We see whole life and term continuing he noted. Life insurers learned some les- to grow but maybe at a slower rate than sons from the pandemic that will help previously,” he said. “When you look at make the life insurance purchase process growth rates since 2020, you saw strong easier for consumers and encourage more growth in digital products, especially of them to buy. term. But now you see universal life prod“Insurers realized they have an oppor- ucts catching up. So I think we’ll still see tunity to change the perception of our whole life and term growing — maybe at a business and become much more cli- slower rate than what they’ve been recentent-centric,” Levenson said. “Insurers had ly — but we do think they will be higher to make advances in digitization, initially than pre-pandemic levels.” for survival. But now they realized this was great for business, great for our cus- Interest Rates Still Problematic tomers. Now consumers can engage with Low interest rates “are the headwinds that us the way they want, and we can speed up life insurers are facing,” Levenson said. the process. A lot of that is going to stick “But I think you’re seeing the industry December 2021 » InsuranceNewsNet Magazine

COVER STORY CAN THE INDUSTRY MAINTAIN THE MOMENTUM?

Technology Will Be The Leading Challenge For Insurers Over The Next 5 Years Technology

37%

Interest rates

26%

Growth

24%

Regulation

22%

Customer experience

21%

Change management

20%

New ways of working

19%

Source: BCG and LIMRA

continue to adapt and act on that,” he said. “It depends on where you sit in the industry. Some carriers have had to get out of certain lines of business. And you’re seeing private equity shops buying these blocks of business.” Levenson was reluctant to predict where interest rates might be in the coming year, but an upward or downward rate spike “is never good for anyone because that means something’s wrong in the economy.” “But if it’s a slow, steady trend upward, that’s good for the industry; it gives them more room to work.”

industry and advisors need to incorporate some talking points addressing those issues when they present life insurance to young adults. If you can couple that information along with increased digitalization, that’s how you get younger people to buy.” As younger generations of adults hit many of life’s milestones — buying homes, getting married, starting families — more young adults will see the need for life insurance, Levenson predicted. “They’ll realize, ‘Life insurance serves a real purpose, I have a real need for it, it’s valuable to me and I need to get it.’”

Appealing To Younger Consumers

The War For Talent Is Real

How does the industry get young adults to buy life insurance? Although insurers made inroads with the millennial generation during the pandemic, Levenson said more needs to be done. Increased digitalization is one way the industry can appeal to young adults, he said. “Making the process easier and faster and letting consumers engage with it where and when they want are the keys.” The industry also must address misconceptions young adults have about life insurance, he said. “Our studies show that young adults believe life insurance costs four or five times more than it actually does,” Levenson explained. “Many millennials believe they don’t even qualify for coverage. So the 24

This past year was marked by what some call “the Great Resignation,” in which millions of workers changed careers, retired earlier than planned or left the workforce for other reasons. The life insurance industry is feeling the effects. In his opening remarks at October’s LIMRA annual conference, Levenson said about 17% of the industry’s employment base has been hired since the start of the pandemic, and carriers must be able to train and develop those new employees amid hybrid and remote work. Meanwhile, the industry must find talent to replace those workers who are looking to retire or change jobs. Retention is as much of a challenge as is recruitment, Levenson said. And

InsuranceNewsNet Magazine » December 2021

retention rates vary among carriers. “Some companies are seeing better retention rates than usual, so fewer people are leaving than would normally do so,” he added. “But during the pandemic, some companies reported 30% to 40% turnover. One thing that tells us is that the ability for talent to connect to the firm and to be part of the culture is crucial, and it’s much more difficult to do when so many people are remote. So firms are really struggling with that.” But other companies are finding opportunities in the talent wars. “Some are saying the aspect of being remote and being more flexible can attract people to their company,” Levenson said. “Now they can hire people in Chicago, in New York or wherever for a company in wherever they might be. They’re seeing it as a real positive to attract talent.” Insurance companies are competing with other sectors of the workforce for employees, and the industry must become more creative and flexible in attracting talent, Levenson said. “I think we will see a lot more around employee wellness and offering different benefits in an effort to win the talent games.”

Adapting To Regulatory Change

Although it’s not known what will happen on the regulatory front in the next year, insurance carriers will continue to adapt their products to work within those rules, Levenson said. And as of this writing, it’s unknown what tax changes, if any, Congress will approve next year and how those changes apply to life insurance sales. Regarding any future tax changes or rule changes, Levenson said the core value of life insurance to middle-market Americans remains the same. “Tax policies come and go, administrations come and go, but the fundamental need for life insurance and the opportunity to own it won’t change.” Susan Rupe is managing editor for InsuranceNewsNet. She formerly served as communications director for an insurance agents’ association and was an award-winning newspaper reporter and editor. Contact her at Susan.Rupe@ i n n f e e d b a c k . co m . Follow her on Twitter @INNsusan.

CAN THE INDUSTRY MAINTAIN THE MOMENTUM? COVER STORY

VAs Back From The Dead And Rising Fast Traditional variable annuity products are hot once again, thanks to talk of tax hikes from Washington. Annuity sales in general look strong for 2022, but could renewed regulation cause problems? BY JOHN HILTON

tax deferral, they’re likely going to be highnet-worth or even ultra-high-net-worth individuals.” Variable annuities were certainly the story in the third quarter, according to SRI sales data. Total VA sales were $30.7 billion in the quarter, up 28% from the prior year. VA sales represented 49% of the total annuity market in the third quarter, the highest level since first quarter 2018. In the first three quarters of 2021, total VA sales were $93.4 billion, 32% higher than the prior year. The VA segment is boosted by new registered indexed-linked products, which dominated sales in recent years. However, traditional VAs rebounded strongly in the third quarter. Traditional VA sales were $21.5 billion in the third quarter, a 22% increase from third quarter 2020. Year to date, traditional VA sales totaled $65 billion, up 17% from the prior year. “Traditional VA sales have outperformed expectations this year, driven by the increase of investment-focused VA sales and fee-based annuities, which were fueled by an increased appetite for tax deferral solutions,” Giesing said. “As a result, we expect sales will grow nearly 20%, to almost $90 billion, exceeding our forecasted expectations.”

raditional variable annuities are back. Well, sort of. Thought to be buried in an avalanche of heightened regulation, along with shinier new annuity product designs, VAs are selling well again, thanks to expected tax changes. As this issue went to press, the Biden administration was continuing to negotiate its spending plans with various key members of Congress. What is virtually certain is that the wealthy will pay more taxes. Perhaps a lot more in taxes. Cue the flight to variable annuities again, where the wealthy can stash money in a tax-deferred vehicle, said Todd Giesing, assistant vice president, Secure Retirement Institute. The tax debate is one that LIMRA and SRI are tracking closely as their annuity sales forecasts evolve in 2022. Advisors should watch out for tax news as well, Giesing said. “If we have a change in the tax law, this has the potential to bring a different customer to the annuity market,” he explained. “And when you think about indiGiesing viduals who are looking for

Forecasts Appear Strong

How annuities sell in 2022 will depend on several economic and market factors, of which tax changes are just

one. Equity markets are performing well with low volatility, and that is projected to continue. Interest rates are inching upward but expected to remain very low for the foreseeable future. The good news for annuity sellers is that a wide range of products fits many different economic scenarios. Most product categories are expected to do well in the year ahead. Giesing broke down the SRI forecasts for each. Registered indexed-linked. This hot product continues to sell well but is slowing down just a bit, Giesing noted. Still, more insurers are entering this market, some with creative offerings. RILAs are expected to sell well through 2022, Giesing said. “A subset of the RILA market that we’re looking at is guaranteed living benefits,” he explained. “As the inventory of guaranteed living benefits on RILAs increases, that’ll give that segment of the business an opportunity to compete with similar products such as traditional variable annuities and [fixed indexed annuities] that offer guaranteed living benefits.” Indexed annuities. The SRI is projecting a steady 10% growth for regular indexed products, as 2022 market projections appear promising. “We’re seeing slow and steady growth as conditions improve from an economic standpoint and under the expectations that interest rates will continue to rise slowly,” Giesing said. Fixed-rate deferred. What is interesting here is the significant numbers of fixed-rate deferred contracts written over the past three years — about $150 billion

December 2021 » InsuranceNewsNet Magazine

COVER STORY CAN THE INDUSTRY MAINTAIN THE MOMENTUM? worth. Many of those were short contracts, between three and five years, Giesing said. “There will be a significant amount of replacement activity that will occur as we move forward,” he added. “Contracts will come out of their surrender period, and likely many owners will go look for another fixed-rate deferred contract.” Income annuities. Single-premium income annuities and deferred income annuities should see slight growth in 2022, as interest rates remain low, Giesing said. “We do expect sales to increase from this year, but albeit very slowly — maybe a billion dollars higher for both.”

What Could Go Wrong?

The political environment remains a mix of good and bad for annuity sellers. On the one hand, the Setting Every Community Up for Retirement Enhancement bill signed into law at the end of 2019 is resetting the annuity sales environment. The SECURE Act tweaked and relaxed a host of tax and regulatory guidelines, all aimed to make it easier for Americans to save for retirement. While companies already can offer annuities in their 401(k) lineups, only 9% do, according to the Plan Sponsor Council of America. The SECURE Act aims to boost that figure and improve retirement readiness by eliminating companies’ fear of legal liability if the annuity provider fails or otherwise fails to deliver. As of this writing, Congress was

considering companion legislation known as the Securing a Strong Retirement Act of 2021. The bill would expand options for contributing to retirement accounts and further ease the use of annuities in those plans. Things are dicier on the regulation side, where 2022 could see a return of the dreaded fiduciary rule first put forth by President Barack Obama in 2015. The DOL’s spring 2021 Regulatory Agenda confirmed that it will be rewriting the definition of fiduciary. The Employee Benefits Security Administration plans to issue the notice of rulemaking by December 2021, the agenda stated. That timeline will surely be delayed, said Fred Reish, partner at Faegre Drinker Biddle & Reath. The DOL is likely headed toward a “definition of fiduciary advice such that any recommendation of a financial product to a retirement account is fiduciary advice,” Reish said during a recent conference session.

Watch FIA Treatment

In February, the DOL allowed the investment advice rule, written by the Trump administration, to take effect. That rule replaced the 2015 fiduciary rule, which was tossed out in 2018 by a federal appeals court. The new rule has two main parts: a new prohibited transaction exemption 202002 and a reinstatement of the five-part test from 1975 to determine what constitutes

investment advice. For now, the DOL is certain to build on PTE 2020-02, Reish said. PTE 2020-02 applies to advice for rollovers and other movement of retirement money. Broker-dealer representatives and investment advisors can use the exemption to collect compensation for transactions involving 401(k)s or IRAs. Insurance producers can still use PTE 84-24 for annuity and life insurance sales involving retirement funds. “I think 84-24 will definitely be modified,” Reish said. “There will be provisions of 2020-02 that will be moved over to it. Probably the fiduciary acknowledgement, the best-interest standard and maybe specific disclosures of reasonable compensation limitation. It’ll look a lot more like a fiduciary type rule than it does right now.” The thing to watch is how the DOL ends up treating fixed indexed annuities, he added. Regulators have tried for years to apply tougher regulations to these products. “Fixed indexed annuities would be the one type of annuity most impacted by [rewriting 84-24],” Reish said. InsuranceNewsNet Senior Editor John Hilton has covered business and other beats in more than 20 years of daily journalism. John may be reached at john. hilton@innfeedback. com. Follow him on Twitter @INNJohnH.

Health Insurance: Stabilized Premiums Despite Nursing A ‘Hangover’ The individual health insurance market will continue to see stabilized premiums. Meanwhile, consumers are making up for care deferred during the pandemic, leading to a possible increase in spending. BY SUSAN RUPE

he health insurance industry could experience a COVID-19 “hangover” in 2022, as consumers who put off getting elective treatment during the pandemic return to the doctor. 26

That was a prediction from PwC’s Health Research Institute, which projected employer medical costs to increase 6.5% in 2022, slightly lower than in 2021 and higher than the period from 2016 to 2020. Contributing to this increased spending are the consumers who received care that had been deferred during the pandemic, as well as the ongoing costs of treating COVID-19, increased mental health and substance abuse issues, and poor pandemic-era health behaviors. However, on the individual market, most carriers who participate in the Affordable Care Act marketplaces assumed COVID-19

InsuranceNewsNet Magazine » December 2021

would have no effect on their 2022 costs, according to rate filings. Kaiser Family Foundation reported that of the 311 rate filings reviewed, 272 plans had a premium change for 2022. Rate changes from 2021 to 2022 range from a 28.5% decrease to a 25.6% increase, although half fell between a 1.8% decrease and a 6.2% increase. The four consecutive years of declining premiums on the individual market

CAN THE INDUSTRY MAINTAIN THE MOMENTUM? COVER STORY is good news for consumcertain areas, not just to ers, said Matt Eyles, presiget treatment and diagdent and CEO of America’s nosis for acute conditions Health Insurance Plans. but for things also like “For next year, we anticimental health treatments pate seeing another decline and services.” in marketplace plan premiums,” he said. “As we’ve The Expansion Of looked at the data, we see Government the average premium for Health Care Eyles the typical benchmark silver A n i ncrea si ng nu mber plan next year will decline by about 3%. of Americans receive their health care And about 80% of individual consumers through government-based programs. who are buying coverage on their own Since 2017, the percentage of managed should be able to find coverage for $10 or care organization members who receive less per month, as a result of the enhanced care through Medicare or Medicaid premium subsidies under the American jumped from 31% to 41%, according to Rescue Plan.” statistics from Florida Blue. Medicaid Lower premium costs are a sign that the currently makes up 25% of the MCO ACA marketplace is moving toward sta- membership mix, while Medicare has bility after its bumpy early years, he said. 16%. Meanwhile, commercial self-funded In addition, consumers have more car- insurance makes up the biggest piece of riers from which to choose in the ACA the pie at 43%, although that share derealm, and some carriers have expanded creased from 50% in 2017. Commercial their coverage areas for 2022. private insurance makes up 16% of the “I think the story of the individual mix, down slightly from 19% in 2017. market is that after several years of trying President Joe Biden campaigned on a to figure out what the market would look health care platform that would expand like, and then some of the changes that Medicaid, lower the Medicare eligibility we had seen under the past administra- age and establish a public option. So far, tion, now we continue to see the market none of these has become reality. But what mature,” Eyles said. “As more carriers en- about in 2022? Eyles was doubtful. ter the market, some of that, I think, is a “I think the message is clear that we reflection that they believe the future is good and it’s the right time to make that investment.” On the employer side, health insurance and related benefits are more crucial than ever to attract and retain workers as the war for talent heats up in the coming year, he said.

should build and improve upon what we have, and I think we’re optimistic that people will recognize that’s still the best way to go over the long term,” he said. But he also said that much of the expansion of government health care could come at the state level. Several states are exploring public options of their own.

Social Determinants Of Health

The terms “health equity” and “social determinants of health” became buzzwords over the past year or so. Health insurers will devote more attention to those factors in the coming year, Eyles said. “Health insurers are committed to addressing health inequities, and especially the underlying social factors,” he said. “I think that will continue to be important in 2022. We also are focusing on the cost and price of prescription drugs, which take up a big piece of the health premium dollar.” Susan Rupe is managing editor for InsuranceNewsNet. She formerly served as communications director for an insurance agents' association and was an award-winning newspaper reporter and editor. Contact her at Susan.Rupe@innfeedback.com. Follow her on Twitter @INNsusan.

2 Other Issues to Watch in 2022

COVID-19 And The New Normal

COVID-19 forced the health insurance industry to adapt, and some of those changes will become more of a norm in the coming year, Eyles said. He pointed to the increasing use of telehealth services as one example. “We really made such a shift toward virtual care,” he said. “And we know a lot of the in-person care has resumed. But I do think that we’re all trying to figure out, longer term, what’s that balance and mix going to be in-person versus telehealth services. I think the pandemic has shown how important telehealth services were, especially in

1. Drug spending. Drug costs continue to rise. On average, insurance covers a larger share of retail prescription drug spending than a decade ago, while consumers’ share has leveled off in recent years. 2. Surprise billing. Unexpected medical bills have largely been put to rest with the No Surprises Act, which takes effect on Jan. 1, 2022. But how this bill will shake out in terms of savings or costs for the industry is unknown. It could lower premiums or shift costs from the consumer to the payer or the employer. Source: PwC Health Research Institute

December 2021 » InsuranceNewsNet Magazine

LIFEWIRES They Want Digital Life Insurance

Millennials ‘Unforgiving’ On Tech Expectations Emerging technology is great for streamlin-

ing delivery of insurance coverage using fewer resources. But it is also creating a much more demanding customer, said Martha Turner Osborne, chief marketing and sales officer for Teachers Life, a Canadian fraternal benefit society. "Marketing to millennials is different than any other group," Osborne said during the Society of Insurance Research annual conference. “If you don’t understand this, you’re going to miss the mark. They are unforgiving in their expectations of technology and customer service. So if our experience doesn’t live up, all the marketing in the world won’t make a difference.” Despite the challenges presented by the younger generations, they do want life insurance, surveys show. Life insurance being perceived as complex and expensive is their key barrier, Osborne noted. There is much work to be done to capitalize on the opportunity, Osborne said. “Our key conclusion on the consumer is that millennials put the work in when it comes to their finances,” she added. “But they face much tougher economic realities than many in previous generations. And while their life milestones are happening later, older millennials are in the key life moments now.”

LIFE INSURERS REMAIN ON STRONG FINANCIAL FOOTING

Capitalization remains strong for U.S. life insurers and investment portfolio stress has diminished, according to Katilyn Pulcher, associate director, S&P Global Ratings. Pulcher made her comments during the American Council of Life Insurers annual meeting. Mortality claims have also declined, and demand for life insurance and annuities has led to significant sales recovery for the industry year over year. The life insurance sector remains a highly rated sector, she added. Ninety-two

percent of companies are rated A or higher, and 93% have a stable outlook. Life insurance sales are stronger than they were before COVID-19. In addition, second-quarter, year-todate adjusted earnings improved, although they were weighed down by mortality rates during the first quarter of the year. “This appears to be on the rebound,” she added.

KANSAS CITY LIFE ANNOUNCES SALE OF SUNSET LIFE

Kansas City Life announced that it has sold Sunset Life, a wholly owned subsidiary, to Bona Holdings. Kansas City Life is expected to record a net gain of approximately $5.5 DID YOU

KNOW

QUOTABLE There is really an education problem in the group life insurance marketplace. — James Beem, J.D. Power

million on the transaction. Sunset Life was founded in 1937 and acquired by Kansas City Life in 1974. Sunset Life operated primarily in the life insurance and annuity market but ceased writing new business in the early 2000s.

METLIFE FINDS MORE CLAIMS FROM YOUNGER COVID-19 VICTIMS

The third quarter proved to be costly for MetLife as COVID-19 deaths among younger workers brought a wave of claims against the company, which is a major provider of workplace-based life insurance. However, the high level of death-benefit payout was more than offset by unusually strong investment gains from the small slice of the insurer’s investment portfolio held in private-equity funds. MetLife more than doubled its net income and posted a 31% increase in its adjusted earnings, The Wall Street Journal reported. MetLife’s COVID-19 details followed reports of elevated deaths at other insurers, including The Hartford and Prudential.

Northwestern Mutual’s $6.5 billion dividend payout for 2022 was its largest ever.

InsuranceNewsNet Magazine » December 2021

Source: Northwestern Mutual

Life Insurance | Annuities | Asset Protection

Protecting what matters most. Together. Your clients count on you to help them protect what matters most. And for more than a century, you’ve trusted Protective to work as hard as you do for your clients and help you deliver the sense of security they deserve. Now, more than ever, Protective is here for you with a bold new energy and renewed commitment to helping you make life insurance and annuities more accessible to more people. We’re here to help your clients be more confident, to help you protect more people and to help you grow your business. Because in the end, we’re all protectors. protective.com/protectors The Protective trademarks, logos and service marks are property of Protective Life Corporation and are protected by copyright, trademark, and/ or other proprietary rights and laws. Protective and Protective Life refers to Protective Life Insurance Company (PLICO) located in Nashville, TN and its affiliates, including Protective Life & Annuity Insurance Company (PLAIC) located in Birmingham, AL. Insurance and annuities are issued by PLICO in all states except New York and in New York by PLAIC. Product availability and features may vary by state. Each company is solely responsible for the financial obligations accruing under the products it issues. Product guarantees are backed by the financial strength and claims-paying ability of the issuing company. Insurance and Annuities are: Not a Deposit | Not Insured by any Federal Government Agency | Have no Bank or Credit Union Guarantee | Not FDIC/NCUA Insured | May Lose Value CLABD.2925266.07.21

December 2021 » InsuranceNewsNet Magazine

LIFE

Open The Door To A Policy Review A life insurance checkup is essential for a client’s healthy financial plan. But first you have to convince them to do it.

By Caroline Brooks

he COVID-19 pandemic has spurred awareness and interest in life insurance like never before. A recent LIMRA study revealed nearly one-third of consumers (31%) said COVID-19 has made it more likely they will purchase life insurance in the next 12 months and 102 million Americans believe they need more life insurance. Coupled with

potential tax law changes that threaten to drastically change estate tax and trust planning, now is an opportune time to reach out to clients to review their existing plans and coverage.

Why Is Policy Review Important?

All too often, life insurance policies are purchased and largely forgotten. This can lead to insufficient coverage, paying too much for coverage, familial discord when beneficiary designations are not up to date, and other issues. By helping your clients and trustees conduct routine policy reviews, you can uncover gaps in coverage and identify new planning opportunities. The key to getting a client to engage in policy review and answer your email or

By helping your clients and trustees conduct routine policy reviews, you may uncover gaps in coverage and identify new planning opportunities. 30

InsuranceNewsNet Magazine » December 2021

return your call is by ensuring you are asking thoughtful, personalized, probing discovery questions. For example, consider asking:

1. “What has changed in your life since we last met?” 2. “When was the last time your policy was reviewed? I’d like to take a look to see whether it is still performing as expected.” 3. “There are significant proposed tax law changes that I am concerned may impact your estate plan. I’d like to discuss this with you as soon as possible.” When it comes to sending emails or leaving voicemails, less is often more. Keeping your message short, but briefly highlighting the value you can offer, can help to hook clients who want to learn more and can lead to a call-back.

Policy Review Basics

When you meet with your client to begin the policy review process, the first step is to understand why the insurance was

OPEN THE DOOR TO A POLICY REVIEW LIFE purchased and to determine whether the existing policy is still meeting that need today. This includes helping clients review beneficiary designation changes at least every two to three years or sooner if there has been a change in life circumstances, such as the start of a business, marriage, divorce, the birth of a child or a death. The second step is to determine whether the policy is still performing as intended by reviewing the underlying policy and investments. There are a variety of reasons a policy can fail to perform as initially illustrated. For example, older whole life or universal life policies may be performing poorly due to a combination of factors including a low interest rate environment and changes to a carrier’s cost of insurance charges. Timing of premium payments or inadequate policy funding also can be an issue. In some cases, particularly where poor policy performance or large loans against the policy cash value put the policy at risk of lapse, you may need to increase the premium or reduce the death benefit. In other cases, a tax-free 1035 exchange of the policy may be advisable. For example, if an older mortality table was used or if the insured’s health has improved, a new policy may mean lower premiums. Replacing the policy also can allow the client to address holistic planning goals, such as adding long-term care protection or providing clients access to new products or product features on the market.

Managing Trust-Owned Life Insurance

In the context of policies owned by irrevocable life insurance trusts, routine policy review by the trustee is especially critical. Failing to proactively manage and administer an underlying trust-owned policy potentially can frustrate planning goals. In addition, the trustee can be held personally liable for breach of fiduciary duty to the trust beneficiaries if a policy does not perform as expected. With changes to intentionally defective grantor trusts potentially on the horizon, now is an especially important time for insurance professionals to have discussions with ILIT trustees.

TOLI – A Ticking Time Bomb Or A Golden Opportunity?

Trustees have a fiduciary duty to the trust beneficiaries, meaning trustees are

required to manage trust assets with the best interests of all beneficiaries in mind and to maintain an objective standard of care. For TOLI policies, trustees’ fiduciary responsibilities include facilitating the ongoing payment of premiums, income tax management and providing notice to Crummey beneficiaries. Trustees also have important investment duties, as outlined by the Uniform Prudent Investor Act and further defined by case law over the years, requiring that trustees today take a more proactive approach to managing trustowned policies. There have been several notable cases where ILIT beneficiaries have sued the trustee for breach of fiduciary duty. The TOLI litigation of the past decade has impacted both corporate trustees as well as trustees who were “nonprofessional” trustees, such as family members or friends. Nonprofessional trustees account for roughly 90% of ILIT trustees, according to “The Life Insurance Policy Crisis,” by Randolph Whiteclaw and Henry Montag (American Bar Association 2017). The unfortunate reality is that many nonprofessional trustees may be unaware of their responsibilities with regard to ongoing insurance and investment management and are less likely to have expertise in understanding the mechanics of life insurance policies. These trustees may need to engage an independent entity to evaluate the policy’s health. Insurance professionals also have a unique opportunity to work alongside trustees to assist with ongoing policy review. Those who do so may be well-positioned to uncover opportunities to help trustees accomplish the trust’s goals.

Grantor Trust Tax Proposals As A Catalyst For Review

As of press time for this article, Congress was negotiating a $3.5 trillion infrastructure bill, with spending offset by numerous proposed tax increases on wealthy clients and corporations. In particular, changes to the grantor trust rules may have a significant impact on TOLI. ILITs are typically “grantor trusts.” This is a type of irrevocable trust containing provisions or powers as defined in the Internal Revenue Code that cause the grantor to be treated as the owner of trust assets for income tax purposes but keep assets outside of the trust for estate tax

December 2021 » InsuranceNewsNet Magazine

Where Deals Get Done There is no better place to network with the right people and solidify your business than ICMG 2022, known as “the best conference in the industry”. If you’re looking for: • New products • Someone to design a new product for you • Distribution for a new or existing product You’ll find what you are looking for at the ICMG Conference! • Join 400+ insurance and financial services executives • Pitch your story: 30-second introductions everyone sees • Speed networking: 90-minutes of face-to-face introductions • Golf with attendees “fore” charity • Deluxe accommodations at the Trump National Doral in Miami, FL • And more…

BE A DEAL MAKER this February 1 - 2 at the 2022 ICMG Annual Conference.

Visit ICMG2022.org now to download your free conference brochure and see the Top 10 Reasons to Attend ICMG. Use conference promo code: inn22 to save $100 off registration!

LIFE OPEN THE DOOR TO A POLICY REVIEW

Checklist For A Policy Checkup Life changes that have occurred since I purchased my policy (check all that apply) ___ ___ ___ ___ ___ ___ ___ ___ ___

New home New child or grandchild Change in marital status New employment or promotion Started or sold a business Change in health (myself and/or my spouse) Retirement Death of a family member Providing care/financial support to aging parent

Existing Coverage (list all existing life insurance policies) Why did you buy your policy? Lifestyle Information Do you exercise regularly? ___ Yes ___ No Do you smoke? ___ Yes ___ No ___ Recently quit or planning to quit How often do you see your primary doctor? ___ Once a year or more ___ Less than once a year ___ Never Would you be motivated by rewards and/or discounts to make healthy lifestyle changes? ___ Yes ___ No ___ Maybe

SOURCE: John Hancock

purposes. Under the proposals, a new section of the code, IRC §2901, would cause property held in a grantor trust created after the enactment date to be included in the grantor’s gross estate. Additionally, contributions to grandfathered grantor trusts after the date of enactment would result in partial estate tax inclusion. This is concerning because many clients fund 32

the premiums for life insurance owned in grantor ILITs on an annual basis using the annual exclusion or Crummey gifts. Although what ultimately may become law still remains to be seen, there are certain steps insurance professionals can take now to alleviate concerns and offer flexible solutions. As a first course of action, consider reaching out to clients who

InsuranceNewsNet Magazine » December 2021

have existing grantor trusts to discuss potential planning options before changes can go into effect. For existing ILITs with ongoing premiums, the planning team may want to encourage some clients to make lump-sum gifts to these trusts before changes could go into effect. If large gifts are not an option, after the date of enactment, loans or split-dollar arrangements would likely be required to fund ongoing premiums in a grandfathered grantor trust. The client could consider funding the grantor trust with a smaller seed gift now to enable the trust to pay interest or economic benefit if loans or split-dollar arrangements are required to fund ongoing premiums in the future. These types of planning conversations may open the door for reviewing existing coverage in the trust as well. While clients and their attorneys consider options for trust drafting and funding, insurance professionals can conduct policy reviews, which may uncover the need to update or improve coverage to meet current planning objectives and prepare for potential tax law changes. For example, if funding ongoing premiums after potential enactment is a concern, agents could explore 1035 exchanges for single pays and short pays. Moreover, if estate tax exemptions are reduced under proposed legislation, there may be a need for increased death benefit liquidity to pay for estate taxes. With so much general uncertainty, clients are likely to be more concerned with their protection needs than ever before. Now is an excellent time to reach out to your clients to assist with policy review. Financial professionals may find that taking the initiative helps to build trust and strengthen client relationships, and it may help identify new insurance needs. Caroline Brooks, JD, CFP, CLU, is assistant vice president and counsel, head of advanced markets, John Hancock Insurance. She may be contacted at caroline.brooks@innfeedback.com.

Like this article or any other?

Take advantage of our award-winning journalism, licensure and reprint options. Find out more at innreprints.com.

Help your clients build and protect their futures. In an ever-changing world, our commitment to you remains unchanged. We provide the tools, expertise and experience to help you ensure your success. Together, we can help build a retirement your clients can truly enjoy. Visit equitable.com/certainty to learn more.

Equitable is the brand name of the retirement and protection subsidiaries of Equitable Holdings, Inc., including Equitable Financial Life Insurance Company (Equitable Financial) (NY, NY), Equitable Financial Life Insurance Company of America (Equitable America), an AZ stock company with main administrative headquarters in Jersey City, NJ, and Equitable Distributors, LLC. GE-3887548.1 (10/21) (exp. 10/23)

ANNUITYWIRES

Variable annuity sales up 28%

3Q Annuity Sales Soar Higher

Fixed indexed annuity sales up 30% Deferred income annuity sales up 29%

The consumer appetite for annuities continues to grow stronger as the industry fully rebounds from the COVID-19 pandemic. Total preliminary U.S. annuity sales were $62.2 billion in the third quarter, up 12% from third quarter 2020. For the year, annuity sales increased 19% to $191.4 billion, representing the highest sales in the first nine months since 2008, according to the Secure Retirement Institute U.S. Individual Annuity Sales Survey. “The surge of the Delta variant pulled overall sales down from second quarter results but continued equity market gains, and low volatility propelled double-digit growth in both traditional variable annuity and registered index-linked annuity sales, resulting in strong year-over-year results,” said Todd Giesing, assistant vice president, SRI Annuity Research. Registered index-linked annuities continued to be the star, with sales of $9.2 billion, up 47% from third quarter 2020. For the first three quarters of 2021, RILA sales were $28.4 billion, 81% higher than prior year. Source: Secure Retirement Institute

AIG CONTINUES RETOOLING LIFE AND RETIREMENT

American International Group is moving ahead with the separation of its life and retirement segments. The moves began with a leadership change. Effective Jan. 1, 2022, Mark Lyons, currently AIG’s executive vice president and chief financial officer, will step into a newly created role of executive vice president, global chief actuary and head of portfolio management. When Lyons transitions to his new role, Shane Fitzsimons will become executive vice president and CFO. Both will report to AIG CEO Peter Zaffino. Meanwhile, AIG closed a deal to sell a 9.9% equity stake in its life and retirement business to Blackstone for $2.2 billion in an all-cash transaction. As part of this agreement, AIG also agreed to enter into a long-term strategic asset management relationship with Blackstone to manage an initial $50 billion of AIG Life & Retirement’s existing investment portfolio upon closing of the equity investment, with that amount increasing to $92.5 billion over the next six years. DID YOU

KNOW

The insurer hoped to sell a 19.9% stake in the life and retirement business. When the Blackstone deal was announced in July, Zaffino suggested that AIG will continue efforts to find additional partners beyond the Blackstone deal for 9.9%.

‘ANNUITY KING’ COUNTERS WITH LAWSUIT IN FRAUD CASE

The self-described “Annuity King” escalated his battle with federal authorities with a lawsuit alleging “rogue, out-of-control, above-the-law” conduct by agents who investigated him. Phillip Wasserman, 64, faces up to 20 years in prison on mail fraud, wire fraud and tax evasion charges from alleged improper annuity sales. The case is set for the February 2022 trial term. The government seeks a money judgment of at least $6.3 million, court documents say, the proceeds of the charged criminal conduct. Wasserman is mounting an aggressive defense. His civil suit claims agents tried to influence witnesses, released tax infor- Phillip Wasserman mation and submitted affidavits omitting key information.

QUOTABLE The age-old perception that the advisor/agent owns the entire annuity customer relationship is no longer the case. — Robert M. Lajdziak, director of insurance intelligence, J.D. Power

16 STATES HAVE ADOPTED BEST-INTEREST SALES RULES

Sixteen states have adopted the revised National Association of Insurance Commissioners’ best-interest update to its annuity sales model. Another eight states are actively considering adoption, said Sarah Wood, director, state policy & regulatory affairs for the Insured Retirement Institute. “IRI and our members are encouraged by the progress we have seen in states to adopt this important consumer protection model regulation,” Wood said. The model articulates a best-interest standard through the following four obligations: care, disclosure, conflict of interest and documentation. The 16 states that have adopted the model regulation are Alabama, Arizona, Arkansas, Connecticut, Delaware, Idaho, Iowa, Maine, Michigan, Montana, Nebraska, North Dakota, Ohio, Rhode Island, Texas and Virginia. Eight other states — Kentucky, Maryland, Mississippi, New Mexico, Nevada, Pennsylvania, South Carolina and Wisconsin — are considering the regulation.

87% of plan sponsors believe providing a guaranteed income option will lead to greater satisfaction with the plan.

InsuranceNewsNet Magazine » December 2021

Source: Allianz Life

ANNUITY

How Annuities Can Smooth Rough Financial Waters Many clients may not think of annuities as an asset class that could play an important role in their portfolio, even though annuities can serve as retirement insurance.

What Investors Fear And What They Find Appealing 83% say that not losing principal is very important

By Steve Scanlon

uring times of uncertainty, many clients are concerned about their investments, savings accounts, portfolios and overall financial plans. I’ve had numerous conversations with clients about how they should invest their money in times of market volatility and overall uncertainty. And of course, it’s important for financial professionals to discuss the potential benefits of a balanced asset allocation approach — no matter what the market is doing — that includes equities, bonds, alternative investments and annuities. We’re slowly seeming to emerge from one such period of uncertainty, and equity markets have performed well. As such, many financial professionals and clients may not be thinking about what they might need the next time the waters get rough. But now may be the time to put in place the tools, or insurance, that clients may need in order to withstand the next downturn. Many clients may not think of annuities as an asset class that could play an important role in their portfolio, even though they have the ability — depending on the type — to provide some tax protection, market participation with downside protection, or income guarantees that can act as retirement insurance. Here are best practices for financial professionals to help guide their clients on how to incorporate annuities into their portfolio. They include why it is important for financial professionals and clients to view annuities, like insurance, as an asset class — during times of recovery and times of uncertainty. Just like all insurance, it never seems worth it until you need it, but then it’s a relief to have it in place. 36

7 in 10 conservative investors fear they will run out of money 92% recognize that inflation will have an impact on their expenses Most investors find the idea of structured investments and lifetime income appealing SOURCE: Equitable and the Insured Retirement Institute

The Importance Of Financial Protection Products

Due to the continued economic uncertainty for many, there is a growing need for financial products that provide some level of protection against market volatility and low interest rates. For those nearing retirement, registered index-linked annuities are a way to continue to participate in potential upside in equity markets while reducing some of the risk of the ups and downs of the market. Some clients may not be interested in investing in the equity markets or may have pulled money out of the market because of the volatility we saw at the start of the COVID-19 crisis. Instead of letting clients miss out on growth opportunities, if appropriate for the client’s goals and risk

InsuranceNewsNet Magazine » December 2021

tolerance, financial professionals can work with clients to incorporate a partial downside protection strategy using a RILA to help them more comfortably get back invested or stay invested in the market over the long term. We’ve seen recent growth in RILA annuity sales over the past several years. These types of annuities can help many investors stay invested in the market, take advantage of potential upside to help them keep pace with inflation and fund a longer retirement while also mitigating some of the downside risk that may make them uneasy. Finding the right balance between growth and risk is essential given the current uncertainty. I suggest financial professionals work with clients to determine where these types of annuities can fit best into their portfolios.

HOW ANNUITIES CAN SMOOTH ROUGH FINANCIAL WATERS ANNUITY

Help Investors Stay In The Market And Handle Unexpected Costs

A variable annuity is another type of annuity to consider implementing in a client’s portfolio. The potential for investment loss keeps many investors from investing in stocks; however, variable annuities can provide a way to capture some of the upside potential of stocks and secure a minimum level of income. While individuals still need to capture growth from the market to fund longer retirements, they also need to balance that with some protection against losses and their potential need for an effective, tax-efficient distribution strategy. Annuities can help people think differently about how they draw down on their portfolio to create income. Furthermore, individuals may be able to wait out market fluctuations for discretionary expenses if their basic expenses are covered by an annuity. Unexpected costs, both those that arose from COVID-19 and other more commonly unanticipated costs, such as unforeseen medical

expenses, should be factored in to anyone’s retirement savings plan. In addition to paying for unexpected costs, annuities also provide asset and tax protection, as they are tax-deferred vehicles that can avoid capital gains taxes.

The Benefits Of Annuities During Economic Uncertainty

During times of uncertainty, financial professionals should work with clients on various options for their financial plans — including taking a fresh look at the assets they are investing in and reconsidering how annuities can fit into a diversified portfolio. Equitable’s research shows that when you describe the benefits of annuities to clients, they understand that annuities are aligned with clients’ goals. For example, research we conducted with the Insured Retirement Institute showed that:

» 7 in 10 investors fear running out of money in retirement and want lifetime income.

IncomeShield

» 7 in 10 people found annuity products that offer principal protection, the potential for market growth or guaranteed lifetime income appealing. » 80% of respondents found structured and guaranteed lifetime income annuities easy to understand. Annuities can play an important role in a client’s portfolio and different products can provide different strategies, such as market participation, upside potential and a buffer against some downside risk, tax protection and guaranteed income. Now is the time to put a level of protection in place to help clients stay on track the next time volatility and uncertainty hit the financial markets or the economy. Steve Scanlon is head of individual retirement at Equitable. He may be contacted at steve.scanlon@innfeedback.com.

FIXED INDEX ANNUITY

Ensure clients the dignity of a paycheck for life

Boost Retirement Dollars

Generate Lifetime Income

Protect Retirement Paychecks

7% bonus on all year-one premium*

5 Lifetime Income Benefit Rider (LIBR) options**

Lifetime income payments available after 30 days with no fee LIBR

For more information on the IncomeShield fixed index annuity, visit american-equity.com/incomeshield-annuity *Premium bonus available on IncomeShield 10. Bonus available on 1st year premiums. Each year after the 1st contract year, clients become vested in a percentage of the bonus, until 100% vested at the end of the 10th contract year. Vested amounts of the bonus are the amounts not forfeited as a result of an early withdrawal or surrender. Bonus, surrender charges, and vesting schedules may vary by state. See brochure and disclosure for details. **Available for issue ages 50+. Lifetime Income available through optional Lifetime Income Benefit Rider. Lifetime Income Benefit Rider may have annual fee based on the income account value, deducted from contract value. Surrender charges may apply to excess withdrawals that exceed 10% annual free withdrawal available under the contract. You may be subject to a 10% federal penalty if you make withdrawals before age 59 1/2. American Equity Investment Life Insurance Company® does not offer legal, investment, or tax advice. Each client has specific needs which should be discussed with a qualified legal or tax advisor. Annuity and Riders issued under form series ICC17 BASE-IDX, ICC17 IDX-10-7, ICC17 BASE-IDX-B, ICC17 IDX-11-10, ICC16 R-MVA, ICC20 R-LIBR-FCP, ICC20 R-LIBR-FSP, ICC20 R-LIBR-W-FCP, INVESTMENT LIFE INSURANCE COMPANY ICC20 R-LIBR-W-FSP and state variations thereof. Availability may vary by product and state. Guarantees are based on the financial strength and claims paying ability of American Equity. For agent use only. Not for use in solicitation or advertising to the public. 6000 Westown Pkwy, West Des Moines, IA 50266 TM

AMERICAN EQUITY

01AD-INN-1121 11.04.21

www.american-equity.com ● Call us at 888-221-1234 December 2021 » InsuranceNewsNet Magazine 37

HEALTH/BENEFITSWIRES

Workers Cling To Jobs For Health Insurance Although “the Great Resignation” has seen record numbers of Americans leave their

jobs, a Policygenius survey showed a large percentage of workers are holding out for their health insurance. One in three workers (33%) would be very likely or somewhat likely to leave their jobs in the If health insurance wasn’t a factor, how likely near future if health or unlikely would you be to leave your current insurance weren’t a facjob in the near future? tor, the survey said. Very or some- Neither likely Very or someYounger workers are Age what unlikely nor unlikely what likely more likely to consider 18-34 32% 28% 40% leaving their jobs if not for health insurance, 35-54 32% 35% 33% with 40% of those 18 55+ 42% 33% 25% to 34 years old saying All 35% 32% 33% health insurance is what holds them back SOURCE: Policygenius Health Insurance Survey 2021 from giving notice. More than one in four respondents (26%) said they would be at least somewhat likely to start their own business if health insurance weren’t a factor. The percentage of younger workers feels even more strongly on this issue, with 37% of insured Americans ages 18 to 34 saying they would be at least somewhat likely to pursue entrepreneurship if health insurance weren’t a factor. The survey also found that people whose primary source of health insurance information is social media were more likely to avoid COVID-19 testing (39% of those getting information from social media versus 14% of those relying most on other sources), treatment (20% versus 8%) and care (22% versus 8%).

LTC: GREATER NEED, MORE RELIANCE ON FAMILY

Long-term care is becoming more complex, extending for a longer period of time and depending more on family members to administer. That’s the word from Genworth, which released its study “Caregiving In COVID-19: Beyond Dollars.” The study found care is more complicated. Nearly half (49%) of care recipients require help in “all aspects of daily living,” which is a jump from 39% in 2018, while only 8% need “very minor assistance,” which is a drop from 12% in 2018. In addition, over the past three years, more people suffered from age-related physical DID YOU

KNOW

limitations, accidents requiring rehabilitation, and cognitive impairment. The length of time in which people need care has increased by a half a year since 2018 to 3.5 years in 2021. Family members are stepping up to provide care, with one in three Americans reporting that they unexpectedly became caregivers, and adults reporting the need to spend an average of about 19 hours a week providing care.

WORKERS GIVE EMPLOYERS HIGH MARKS ON BENEFITS OFFERINGS

Sevent y-six percent of employees favorably view their employer’s efforts to improve their overall well-being, according to the 2021 Workplace Wellness Survey conducted by the Employee Benefit Research Institute and Greenwald Research.

QUOTABLE As millennials take steps to recalibrate in the coming months, they’re going to require benefits that match their evolving needs. — Marquis Smallwood, vice president, Workforce Engagement, MetLife

And more than three in 10 (31%) believe their employer’s efforts to improve their overall well-being have increased, which is a modest increase from last year (28%). Health insurance is the benefit employees say contributes the most to their feelings of financial security. Nearly twothirds of employees say their health insurance “contributes a lot” to their security and trust their health insurer to make good decisions. Paid time off and leave benefits contributed to employees’ sense of financial security as well. Seventy-seven percent of employers offered paid vacation, two-thirds offered paid sick leave and 39% offered paid paternity leave.

HALF OF WORKERS ADDED AT LEAST ONE NEW HEALTH BENEFIT

Almost half (44%) of all U.S. employees purchased at least one new health benefit in response to the COVID-19 pandemic, according to the 2021 Aflac WorkForces Report. Roughly one-third of respondents said they purchased critical illness, hospital indemnity, telehealth services or mental health resources. COVID-19 exposure played a large role in buying additional benefits. The survey found that those respondents who had tested positive for COVID-19 were more likely than other respondents to purchase at least one new health benefit.

60% of employers reported an increase in benefits costs over the past year.

InsuranceNewsNet Magazine » December 2021

Source: Aflac

Working to make retirement clearer for everyone. Starting with you. Let’s face it. Retirement can be confusing for just about everyone. At Jackson ®, we’re here to help clear things up. Our range of annuity products help remove the uncertainty that complicates your clients’ plans. And, our award-winning customer call center, * fee transparency, and user-friendly website make navigating everything easier for you. Together, we can help make retirement clearer for everyone. Annuities are long-term, tax-deferred vehicles designed for retirement. Variable annuities involve risks and may lose value. Earnings are taxable as ordinary income when distributed. Individuals may be subject to a 10% additional tax for withdrawals before age 59½ unless an exception to the tax is met. * SQM (Service Quality Measurement Group) Contact Center Awards Program for 2020.

Before investing, investors should carefully consider the investment objectives, risks, charges, and expenses of the variable annuity and its underlying investment options. The current contract prospectus and underlying fund prospectuses, which are contained in the same document, provide this and other important information. Please contact your Jackson representative or the Company to obtain the prospectuses. Please read the prospectuses carefully before investing or sending money. Annuities are issued by Jackson National Life Insurance Company (Home Office: Lansing, Michigan) and in New York by Jackson National Life Insurance Company of New York (Home Office: Purchase, New York). Variable annuities are distributed by Jackson National Life Distributors LLC, member FINRA. These products have limitations and restrictions. Contact Jackson for more information. Jackson® is the marketing name for Jackson National Life Insurance Company® and Jackson National Life Insurance Company of New York®. CMC25777CCCAD 04/21

Not FDIC/NCUA insured • May lose value • Not bank/CU guaranteed Not a deposit • Not insured by any federal agency December 2021 » InsuranceNewsNet Magazine

HEALTH/BENEFITS

3 Ways To Make HSAs The Choice For Employees Workers may be confused about health savings accounts or may fear a large, unexpected expense. Here are ways employers and brokers can educate them. By Amy O’Meara Chambers

hy aren’t more employees selecting health savings accounts? Many human resource teams work diligently with their benefit brokers to offer a thoughtfully crafted HSA with at least one of their health plan options, only to be disappointed in the final enrollment numbers. They are left scratching their heads when faced with lower-than-expected employee selection. When the HSA should be the clear winner compared to the traditional, more expensive health plan options, what more can an employer do to help employees shift to an HSA? Most employers design an HSA offering in which the combination of an employee’s premium contribution for the high-deductible health plan plus any employer contributions to the HSA creates an offering for employees that is more attractive than the employer’s next best health plan choice. A lower employee contribution for the HDHP premium will immediately grab the attention of most employees, and then most will calculate whether the annual savings in premium will cover the HDHP’s deductible exposure for the year. It is essential to consider your employee demographic as you create your financial package for the HSA, considering average family income as well as their financial and health care literacy. A “lower” employee contribution to premium should be relatively lower than other employee premiums associated with plans you offer and should consider this employee demographic. If the 12 months of premium savings do not outweigh the higher-deductible 40

liability and the HSA tax savings do not convince a worker to choose the HDHP with an HSA, an employer HSA contribution could help sway hesitant employees. Although the intent is not to have the combination of the lower worker premium and the employer contribution fully pay for all out-of-pocket costs for the worker, the HSA’s overall financial

Make the account-opening and contribution processes easy. Sometimes workers shy away from their employer’s HSA option because they are confused or don’t want to spend much effort opening an account. “Too much work,” they will argue. The good news is that the HSA industry has come a long way to make opening

HSA Assets Approach $100 Billion Through First Half Of 2021

SOURCE: Devinir Research

In the first half of 2021: • Total HSA assets reached $92.9 billion, a 26% increase year over year. • HSA dollars that are invested soared to $30.4 billion, up 73% year over year. • There are now over 31 million HSAs, a 6% increase year over year. • Almost $24 billion was contributed to HSAs.

package must look better than the employer’s next best plan offering and give the employee a reason to give the HSA a closer look. Assuming worker contributions to the HSA premium are lower compared to your other health plan offerings and you’re already incenting workers with an employer HSA contribution, here are three additional ways to help nudge workers into a health plan that features an HSA.

InsuranceNewsNet Magazine » December 2021

accounts easy, and the IRS allows employerplan sponsors to help streamline the account-opening and contribution processes without triggering regulatory issues. Employers can choose a single HSA provider for their workers. This comes with certain advantages: Employers can pay any HSA-related fees for workers. Employers also can establish cafeteria plans for workers to contribute to their HSA via payroll deduction (which allows

MAKE HSAS THE CHOICE FOR EMPLOYEES employer and worker savings on FICA and FUTA taxes). Employers also can help their workers maximize savings for future health care needs by selecting investment options offered by the HSA — and even match what is offered in their 401(k) — without placing the burden on the worker. An employer can create easy on-ramps for workers to open and contribute to their HSAs and help workers maximize their HSA investments. Employers should promote this ease during the enrollment process.

Personalize your education efforts. Sometimes a one-on-one session is all it takes to help someone on the bubble decide to opt in to a health plan with an HSA. Brokers can work with their employer clients to conduct one-on-one sessions during paid work time through Zoom or a private on-site area over a few days. Any broker with experience implementing HSAs has answered almost every possible question about them. Brokers

Making it easy for employees, or their adult dependents, to quickly understand the advantages of an HSA can go a long way to encouraging enrollment in such plans. can inspire confidence in the program and help maintain the privacy required for workers to share their family’s financial and health circumstances to determine how an HSA might work for them. Making it easy for employees, or their adult dependents, to quickly understand the advantages of an HSA can go a long way to encouraging enrollment in such plans. Additionally, if employer contributions to the HSA are part of the benefit offering, make sure enrollment education highlights the fact that these contributions can be saved or used in many ways

HEALTH/BENEFITS

today and in the future. Videos or meetings featuring employee testimonials and links to resources to help employees in their native language also may be helpful.

Provide access to funds. Not all employers can afford to make contributions to their workers’ HSAs in addition to bearing the cost of sponsoring a health plan. For those that can, most brokers would agree that employer contributions move the needle on enrollment. For those employers that make no or low contributions to the HSA, it may be worth adding a financial security benefit to assist workers with payment and management of their out-of-pocket health care costs before they have funds in their HSA. One common employee fear is that their family will experience a large-scale medical event early in the plan year that they didn’t anticipate and cannot afford — at least not without having additional time to save. Employees are rightfully fearful about how they will pay their share of a potentially large health care bill under an HDHP design. The need for creative benefits to buffer employees from unexpected health care expenses has never been more important. New financial security benefit programs in the market complement HDHPs that allow employees additional time for repayment on consumer-friendly terms. HSAs continue to carry the torch for consumerism. When individuals have greater financial skin in the game, they are more likely to be engaged in their own health care choices. This has a positive effect on long-term outcomes and overall spending. HSAs can be an excellent offering — superior to traditional health plan designs — for both employers and employees. It is worth the additional effort to make sure that employees understand the advantages of an HSA and that an employee’s transition to an HSA is as simple and as de-risked as possible. Amy O’Meara Chambers is the cofounder and chief operating officer of HealthBridge. She is the author of HSAs For Dummies. Amy may be contacted at amy.chambers@innfeedback.com.

December 2021 » InsuranceNewsNet Magazine

Your Place At The Top Is Waiting! North American Insurance Services strives to provide agents with the tools they need to succeed. Our unique approach sets us apart — providing best-in-class products and in-house support, as well as practical training from elite producers. But don’t take our word for it — see what our top producers have to say! “The growth I’ve seen with this company has been phenomenal. There are always new opportunities and training. There are not a lot of places that are willing to go out of their way to help you grow and build.”

– Kevin, Top Producer “Their techniques for helping clients get coverage are like no other company I have seen. Andy’s amazing training and leadership took me from ground zero to a six-figure income in 2 years!”

– Jacquie, Top Producer “I love the feeling of family at NAIS and the ability to sell all carriers with no limitations. The company’s innovative thinking is what keeps it a step ahead of the competition.”

– Mark, Top Producer

Visit SucceedWithNAIS.com for more information about what makes us different!

Financial facts and figures powered by AdvisorNews.com

Gen Z’s Finances Most Americans’ Negatively Hit By Pandemic Priorities Out Almost half of American workers said their fiOf Sync With nancial situation has been negatively impacted GEN Z by the COVID-19 pandemic, but that impact Retirement STRUGGLES varies among the four generations who are in the workforce, according to the 21st Annual Planning Retirement Survey of Workers conducted by the Transamerica Center for Retirement Studies. More than one in four workers surveyed (43%) experienced one or more negative impacts from the pandemic. Of these, 27% had

50% of Gen Z workers are just getting by to cover basic living expenses. 35% of Gen Z workers are paying off student loans.

their work hours reduced, 14% took a salary cut, SOURCE: Transamerica Center for Retirement Studies 10% were furloughed, 8% were laid off and 4% retired. Generation Z workers were the most likely to be affected, with 59% reporting a negative financial impact, while baby boomers were the least likely to be financially hurt by the pandemic (30%). Only 24% of those surveyed said they are confident they will be able to fully retire with a comfortable lifestyle. Millennials (30%) are more likely to be “very” confident than boomers (21%), Generation X (19%) and Gen Z (16%). Sixteen percent of workers across generations indicate their retirement confidence declined as a result of the pandemic.

Investors Still Blindsided Despite Doing Right Things

Which was worse for investors — the Great Recession of 2008-09 or the financial fallout of the COVID-19 pandemic? Nationwide found the Global Financial Crisis of 2008 had the greatest impact on investors. Nationwide’s study of investors with assets of $100,000 or more found 37% of them were most impacted by the 2008 crisis while 28% said the pandemic crash and recession caused them the most financial harm. Nearly two-thirds of investors (65%) are concerned about a bear market over the next 12 months, 61% anticipate market volatility will increase and 69% are concerned about a U.S. economic recession. It is also sobering to learn that just like last year, during the height of the pandemic, 85% of investors continue to say they can do all the right things to manage their finances and still be blindsided by outside events.

US Retirement System Slips In Global Rankings The U.S. retirement system barely cracked the Top 20 list of the world’s best, according to the annual Mercer CFA Institute Global Pension Index. Iceland’s retirement system was named the world’s best, with the Netherlands and Denmark taking second and third place, respectively. 42

InsuranceNewsNet Magazine » December 2021

Americans’ top priority for retirement is maintaining a comfortable lifestyle. Yet most of them are not confident they will save enough to retire comfortably. Those were among the findings of Regions Bank’s latest retirement survey. The survey found retirement confidence varies by gender, with 39% of men feeling somewhat or very confident compared with 31% of women.

Confidence also varies by income, with only 20% of respondents who make under $40,000 annually reflecting confidence DID YOU in their savings plans KNOW? — and 32% who make between $40,000 The wealthiest 10% of U.S. and $80,000 reflectcitizens hold ing confidence. 89% of all U.S. So what’s standing stocks. in the way of saving SOURCE: Federal for retirement? Daily Reserve living expenses were cited as the biggest obstacle by almost half of those surveyed (45%). This was followed by housing payments (34%), medical debt (24%), saving for other goals such as starting a family or buying a house (21%), and the financial impact of COVID-19 (20%).

The U.S. fell to 19th place, ranking behind Hong Kong but ahead of Uruguay.

The study found the gender pension gap to be especially wide, with women still facing retirement with much less saved in their pensions than men. Women also tend to have less time in the workforce compared with men, which ultimately means less time for accumulation of savings for retirement. Women also have longer life expectancies and are more likely to experience poverty in their old age than men; therefore, they require more capital through their retirement years.

Kansas City Life Insurance Company’s winning IUL sales strategy can help you extol the virtues of including IUL in your client’s retirement planning. Has AG 49-A put a dent in your IUL sales when attempting to create attractive tax-free retirement income scenarios for your clients? Kansas City Life offers two competitive IUL products that include: • Simple design • Five different Indexed Account options to provide maximum upside potential while providing downside protection • Numerous policy riders designed to meet individual needs, situation, and budget • Competitive target premium

Kansas City Life’s winning sales strategy includes: • State-of-the-art illustration system designed to calculate maximum income with a click of the mouse • Historical Indexed Account performance • Excellent IUL marketing collateral that promotes client understanding which helps improve your closing ratio

For information about a vested independent contract with Kansas City Life Insurance Company, call Tom Morgan, Vice President, Agencies, 855-277-2090, or visit www.CompassEliteIUL.com

May 2020 » InsuranceNewsNet Magazine

One-Size-Fits-All Retirement Planning Excludes People Of Color Studies show Black, Indigenous and people of color communities have different financial concerns than those of other ethnic groups. • Susan Rupe

he majority of Americans who identify as BIPOC (Black, Indigenous and people of color, including Hispanic and Asian) believe they won’t have enough money saved for retirement. But although this percentage is similar to that of white Americans, each BIPOC community has a different level of concern than those of other ethnic groups. This is the latest from the Allianz Life 2021 Retirement Risk Readiness Study, which confirms the complexity of retirement planning for BIPOC communities and the approach necessary to help people from different ethnic groups achieve their financial goals. The study also showed the perceived barriers each ethnic community has in working with financial professionals. The study showed that Asian Americans 44

are the most concerned about having enough money to support their post-employment years, with 62% saying they believe they won’t have enough money saved. Meanwhile, 56% of whites and Hispanics are concerned about having enough retirement savings while 52% of Blacks said they are concerned about their savings. Black Americans tended to be less worried than other ethnic groups about other aspects of retirement, with Asian Americans most worried and Hispanics falling somewhere in the middle. Rising health care costs loomed as the biggest source of worry across the BIPOC spectrum, with 76% of Asian Americans most concerned about it, and 66% of Hispanics and 55% of Black Americans most worried about it. At the bottom of BIPOC individuals’ retirement concerns was becoming a financial burden to their loved ones. About one-third (37%) of Black Americans were worried about burdening their families while more than half of Hispanic and Asian Americans were concerned about it.

InsuranceNewsNet Magazine » December 2021

Fewer Getting Advice With Finances

Although Asian Americans expressed concern they were the ethnic group most concerned about their retirement savings, the study showed they are the group least likely to get professional advice for retirement planning. More than one-third (38%) of Asian Americans are receiving professional help with their finances while 38% of Black Americans, 44% of Hispanics and 46% of white Americans are seeing an advisor. However, the low percentages of Americans who are receiving professional financial help indicate there is still ample opportunity for financial professionals to assist BIPOC clients. But just as different ethnic groups have different concerns about their retirement finances, each ethnic group has different reasons for why they do or do not get professional advice, the study revealed. When asked why they are not currently working with a financial professional, more than one-third (37%) of Black American respondents said it was because

ONE-SIZE-FITS-ALL RETIREMENT PLANNING EXCLUDES PEOPLE OF COLOR

The Top Retirement Risks Each BIPOC Community Is Most Worried About

Source: Allianz Life

Black/African American

Hispanic

Asian/Asian American

Health care costs will be so high you can’t afford the care you need

55%

66%

76%

The rising cost of living will prevent you from enjoying your retirement

54%

67%

74%

The cost of living will increase and you won’t be able to afford necessities

55%

63%

70%

That you won’t be able to take care of yourself

47%

60%

69%

Running out of money before you die

50%

64%

65%

The market will take a downturn and hurt your nest egg

52%

60%

66%

You’ll become a financial burden to your loved ones

37%

52%

55%

(% worried)

they “don’t have enough money,” versus only 30% of Hispanic and Asian American respondents. For Asian Americans, the biggest barrier was cost, with 45% indicating it “costs too much” to work with a financial professional versus 27% of Black American and 26% of Hispanic respondents. Hispanic respondents report being most active in the financial planning process, with four in 10 indicating they have made a formal financial plan with a financial professional, versus less than one-third (32%) of Black Americans and only about a quarter (26%) of Asian American respondents.

Different Approaches To Retirement

Travis Walker, Allianz Life advisor specialist, said the differences in retirement concern among various ethnic groups say much about each group’s different approach to retirement. “Some groups may be more about traveling or buying a boat or a vacation home in retirement. But others may think more about retirement as ‘My work is done. Now I just want to live in relative comfort and peace for the rest of my days,’” he said. Each individual ethnic community is not a monolith, Walker said. “Retirement is not the same for everybody in the same group. It largely depends on the job you worked, how long you worked, the geographic area

where you live, and what you want that retirement to look like.” In some ethnic groups, having an elderly relative live with family instead of moving to a care facility is a cultural norm, Walker said, so members of those groups may be less concerned than others about the cost of long-term care. “When you’re not factoring in that cost with your retirement saving and planning, you’re going to have a different concern about retirement saving and not be as worried about that as you are some other concerns.” Walker cautioned that a one-size-fitsall approach to retirement planning often leaves out people of color. “Sometimes, people have some hesitancy talking to a professional about where they’re at in terms of their plans and their preparedness, because, frankly, there’s a little embarrassment or shame associated with it — they think that they should have done more,” he said. “So you have to find what’s important to them and how to achieve it, because the reality of retirement is one that we’re all going to face,” he said. Walker likened retirement planning for members of various ethnic groups to a set of golf clubs. “If someone gave me golf clubs and they were left-handed clubs and a really great set of clubs, that would be awesome

provided I’m left-handed. Otherwise, they wouldn’t be of much use to me. Likewise, a one-size-fits-all approach to retirement isn’t much use either. “It’s important to recognize that these communities are not monolithic. Asians are not all the same, and Blacks and Hispanics also have their own unique experiences. We’re not all the same. But the one thing that is the same is the reality that we’re all going to retire. If you approach it from that, you can talk about some of the things that make people hesitant toward retirement planning. And you can do yourself a service by having a conversation so you can get information you otherwise would not know.” Susan Rupe is managing editor for InsuranceNewsNet. She formerly served as communications director for an insurance agents’ association and was an award-winning newspaper reporter and editor. Contact her at Susan.Rupe@ i n n f e e d b a c k . co m . Follow her on Twitter @INNsusan.

Like this article or any other?

Take advantage of our award-winning journalism, licensure and reprint options. Find out more at innreprints.com.

December 2021 » InsuranceNewsNet Magazine

INBALANCEWIRES

The average office worker receives 120 emails every day. Source: Campaign Monitor

QUOTABLE

How To Tame The Email Monster

Does your email threaten to take on a life of its own? Does the pinging or beeping that alerts you to a new message never seem to end? Do you find yourself stopping and starting during your workday because you are curious about the newest message to pop into your inbox? Here are some suggestions to tame the email monster and take back your workday. The first step is to get rid of the endless buzzing or dinging. That’s right — mute those notifications on your phone or computer. You have appointments for everything else that’s important, so why not make an appointment to check your email? Designate two set times — one in the morning and one in the afternoon — to dive into your email and respond accordingly. Once you are in your email, don’t spend too much time on any single piece of it. Try to spend no more than three minutes responding to a message, and respond in three sentences or less. Flag any messages that need more of a follow up, and set aside a time to respond. You don’t have to remain logged in to your email. When you are done responding to messages, log out of the program completely. You’ll find you are less tempted to check messages if you have to do the extra step of logging back in.

I am a huge supporter of therapy; I see a therapist myself and do not understand why there is a negative stigma around it. — Dr. Terrell Smith, physician and founder of Spora Health

Those who have strong social connections tend to live longer than those who spend most of their time alone. And obesity, lack of exercise, high stress levels and smoking will damage DNA and age you before your time.

DITCH THESE HABITS THAT MAKE YOU LOOK OLD DON’T WAIT — HYDRATE!

Forget caffeine and energy drinks. If you want an extra boost during the day, fill your glass with some good ol ’ H2O. Re g i s t e r e d d i e t it i a n Molly Kimball says that although some people’s primary motivation to chug water is weight loss, what many don’t realize is that water is also key for keeping energy levels up to help you stay active throughout your day. Fatigue is a major symptom of not drinking enough water. If you feel tired or sluggish, it might be because you’re dehydrated. Plain water too boring? Seltzer water is a good alternative, nutritionists say. Studies show the mind links fizzy drinks like seltzer or sparkling water with festive occasions, providing a mood boost as you sip. DID YOU

KNOW

You’re only as old as you feel, the saying goes. But nobody wants to look older than they are. Researchers say here are a few of the things you are doing that make you look older. Use sunscreen daily and your skin will thank you. All skin tones are vulnerable to sun damage, and the sun can be harmful no matter the time of year. Too much screen time also can damage skin cells, with eight hours of the blue light emitted from electronic screens equal to the same amount of damage caused by 20 minutes in the sun. Spend time with friends and family.

WANT TO PLAY A NEW GAME? TRY PICKLEBALL

It has a funny sounding name, but pickleball is one of the fastest-growing sports in the U.S., with an estimated 4.5 million players. This hybrid of badminton and pingpong is a great way to keep in shape and socialize, without putting as much stress on the body as tennis or racquetball. Matches are played on a court considerably smaller than a tennis court, which means less running. But with games typically lasting an hour, you can burn up about 11 calories a minute and work up a sweat. Unlike tennis or other racquet sports, pickleball uses an underhanded serve, which means it’s a good option for those who have rotator cuff or other shoulder issues. And the racquet weighs only seven ounces — lighter than a tennis racquet.

People who eat an apple a day have a reduced risk for breast cancer and lung cancer. Source: American Institute for Cancer Research

InsuranceNewsNet Magazine » December 2021

INBALANCE

A Gut Feeling: The Link Between Digestive Health And Mental Health A healthy gut microbiome is the key to lifting brain fog. By Susan Rupe

e’ve heard these sayings: “Trust your gut.” “I have a gut feeling.” But what does the gut have to do with emotions and mental health? Plenty, said the founder of a digital therapeutics company. Digbi Health founder and CEO Ranjan Sinha told InsuranceNewsNet that maintaining a healthy gut is the key to help lift brain fog and improve overall mental health. Anxiety, depression and insomnia are what Sinha called “whisper illnesses” that take a toll on focus, productivity and motivation — often known as the combination of malaise and exhaustion that we call brain fog. “We are seeing about 40% of the population we deal with is on antidepressant or antianxiety medication,” he said. “And in most cases, mental health is a part of 48

some other comorbidity. We see high numbers of people who are dealing with mental health and dealing with a digestive disorder, such as irritable bowel syndrome. And we see people with mental health issues who also are dealing with obesity. We call digestive health, mental health and obesity issues ‘whisper illnesses’ because there often is a stigma associated with them and people don’t want to talk about them.” Changing your diet and focusing on gut health may help alleviate some of these symptoms, Sinha said. He cited studies suggesting that the human gut microbiome is responsible for the synthesis and metabolism of critical neurotransmitters and hormones such as serotonin. This forms what he called “a gut-brain axis” where the gut is a factor in someone’s mood and emotions. Nearly all of the body’s serotonin, also known as the mood stabilizing hormone, is produced in the gut, Sinha said, with gut bacteria playing a role in the production of that hormone. People who experience depression and brain fog typically

InsuranceNewsNet Magazine » December 2021

have low serotonin levels. “The gut and the brain are highly interlinked,” he said. “And we have always known it instinctively. We call it a gut instinct, when we feel anxious, we feel queasy in the stomach. And there is a very clear physiological connection between the brain and the gut, through the vagus nerve. So it’s not surprising that when you’re anxious, your bowel becomes more irritable, or if your gut health is not adequate, you may not have enough serotonin to keep your mood and your anxiety in control.” Sinha said that although many people who experience anxiety and related issues are prescribed antidepressants, the drugs often don’t heal the root causes of the disorders. He presented a research paper to the U.S. Food and Drug Administration showing that improving the body’s gut microbiome — or the “good” bacteria living in the digestive tract — led to a reduction in generalized anxiety or depression in 68% of the research participants. How do you improve your gut health? Sinha listed three main ways.

THE LINK BETWEEN DIGESTIVE HEALTH AND MENTAL HEALTH INBALANCE

1. Consume probiotics and whole foods.

The preservatives and additives in processed foods might make them taste better and stay fresh longer, but they play havoc with the digestive system’s microbiome, he said. Eating fresh, unprocessed foods is a way of replenishing the good bacteria. But variety is the spice of life where the microbiome is concerned, he cautioned. Thousands of different types of bacteria live in the microbiome. Eating a diet limited to only a few types of fruits, vegetables or whole grains does not add to the diversity of that bacteria. “So it’s really important to maintain a diversity of consumption versus eating only lettuce and spinach every day,” he said.

2. Identify diet deficiencies and food sensitivities.

Vitamin and mineral deficiencies can have an influence on brain fog, with vitamin B12, vitamin D and iron most likely to be lacking in someone who is experiencing it, Sinha said. Food sensitivities, such as gluten intolerance, lead to inflammation in the body, leaving one with a foggy brain. A blood test can reveal a vitamin or mineral deficiency, he said. Taking a supplement can help relieve the deficiency, he said, but a more effective way of dealing with it is to make modifications to the food you already eat to make sure you add more sources of the vitamin or mineral into your existing diet. Food sensitivities can be tricky to diagnose, but the most common food

Best and Worst Foods for Gut Health The Good Prebiotics including: • Jerusalem artichokes • Leeks • Onions • Raspberries • Beans and legumes • Asparagus • Garlic • Bananas • Pears • Watermelon

Fermented foods like: • Sauerkraut • Kimchi • Kefir • Kombucha • Miso • Tempeh • Yogurt

The Bad Artificial sweeteners Red meat Processed and refined foods

Alcohol

sensitivities are to lactose, casein (a protein found in milk) and gluten. Eliminating a potentially sensitive food from your diet for a period of time can help determine whether food sensitivity is contributing to your brain fog.

3. Intermittent fasting.

Intermittent fasting — an eating pattern where you cycle between periods of fasting and eating — is a popular health and fitness trend. Sinha said intermittent fasting gives your digestive system a rest while contributing to greater brain health and clarity. “Every time you take a bite of food, your body must produce insulin,” he said. “Because the body has to deal with the food that you’re eating, break it down, convert it into energy — that’s a fundamental role of why we eat food. So if you’re eating five times a day, that’s five times when your insulin is spiking. And insulin takes time to come back to normal levels. What intermittent fasting does is maximize the time where your body has the right insulin level.” Sinha said intermittent fasting goes back to the early days of human existence, when humans usually ate only once a day. “It’s aligning our eating habits to what the instruction manual of our chemical factory is, so the chemical factory tends to operate better.” “Comfort foods” are familiar foods we crave when we are sad, and those foods typically are high in fats or carbohydrates. But Sinha said comfort foods don’t have to be bad for the body’s gut microbiome. “In many cultures, potatoes or rice are considered comfort foods but because they are high in carbohydrates, many of us consider them to be unhealthy,” he said. “But they actually contain a form of starch called resistant starch. The body does not metabolize it but it is a form of starch that your gut bacteria needs.” Susan Rupe is managing editor for InsuranceNewsNet. She formerly served as communications director for an insurance agents’ association and was an award-winning newspaper reporter and editor. Contact her at Susan.Rupe@ i n n f e e d b a c k . co m . Follow her on Twitter @INNsusan.

Source: eatingwell.com December 2021 » InsuranceNewsNet Magazine

BUSINESS

Great Seller Experiences Facilitate Better Buying Experiences appropriate touch pattern, message or content to engage the buyer with minimal friction.

A look at the top sales engagement challenges for 2022. By Lloyd Lofton

he TOPO Sales Engagement Leadership Report released in December 2020 focused on the innovative practice of sales engagement across high-growth sales teams in light of the COVID-19 pandemic. The report takes a deep dive into the issues of sales enablement and the factors that prevent best-practice results. It provided my team with the instruction and information we needed to address in 2021 as we develop strategies for our continued journey toward excellent service to our clients, converting all consumer interactions to a continuous flow of relationship building and predictable revenue growth. Although the report was published in 2020, after rereading it, here are some lessons we will continue to implement for growth and engagement in 2022. They are lessons that your practice can implement as well.

The Challenge

Sales engagement platforms are a mission-critical technology investment necessary to implement a sales engagement strategy. The overwhelming top sales engagement challenge is content strategy — the need for an effective sales engagement playbook and sales process. Although sellers are responsible for creating the messaging, they lack the infrastructure and experience to scale in an optimizable fashion. This leads to disorganized content libraries and ineffective and unchecked content. The result is a poor buyer experience. The goal is the successful alignment of touch patterns. This includes but is not limited to text messaging, LinkedIn and other social media, video, direct mail and chat — organized by segment and the minimum 50

Automation Capabilities A Top Factor For Success

People buy from people they trust. So how do you build a rep’s confidence in this new selling environment? content needed to deploy the messaging. Great seller experiences are paramount to facilitating better buying experiences. Sellers can use the technology within the context of their work, such as email inboxes, or use the technology directly on accounts, contacts and opportunities in their customer relationship management system.

What is an effective sales engagement strategy?

An effective sales engagement strategy includes prescriptive guidance on how to prioritize leads and accounts; how to store relevant research; how to create a touch patterning decision tree and guided workflows; and how to develop an easy-tosearch content library tagged by scenario, product and use case.

What is an effective playbook?

An effective sales engagement playbook visualizes the common scenarios and triggers for sellers to enroll prospects into touch patterns. It then simplifies the number of decisions sellers must run through to pull relevant content into those scenarios. Getting a team of sellers to adopt a new way of working requires an effective playbook process. That playbook process needs to be designed to prioritize, to recognize common buying behaviors, and to select the

InsuranceNewsNet Magazine » December 2021

Workf lows design and automate processes based on predefined business rules. Previous capabilities of automated or augmented known workflows must be revamped. Today, more advanced workflows completely shift the way sellers prioritize their time. Personalized messaging automation improves reply and meeting rates. This creates high-impact selling activity. To accomplish this, you must leverage available data, messaging and content to craft targeted messages using a combination of custom copy and prewritten templates. Spearheading this is artificial intelligence that provides a Google-like translation of every customer interaction. This creates a “story so far” so sellers know exactly what occurred on every call. It also creates coaching opportunities at the point of deviation to develop best-in-class sales teams. Automation also can create triggers to automatically enroll buyers into targeted touch patterns. This reprioritizes buyers in real time based on frequent engagement with emails. AI and machine learning also can be used to suggest specific messaging-based scenarios.

Work-From-Home Has Upended Industries

The work-from-home sales environment has upended traditional sales enablement — from onboarding sales representatives to training sales reps to getting reps in production sooner and in a cost-effective way. Most training today is something like Zoom sessions. This reduces or eliminates the opportunity for managers to “ride with reps” to see whether they are adopting your suggestions — because they are no longer “riding to see their prospects.”

GREAT SELLER EXPERIENCES FACILITATE BETTER BUYING EXPERIENCES BUSINESS the conversation just by clicking a button during the sales call. By setting up touch patterns that match scenarios, the rep can tell a prospect or a client, “I just sent you an email with a detailed comparison of xxx and xxx that we’re discussing.” When the rep finds the proper supporting content, they can follow up with a compelling message in real time. The client’s response is tracked throughout the relationship, making it better, more efficient, and more effective for the rep simply to click a button during the call. By having a sales enablement process that provides the buying behavior touch points, the rep can set the expectation for the next call with that prospect, and they can see in the AI-generated story-sofar exactly what was discussed and sent during that call. This sets the rep up as a more trusted advisor and sets the expectation for a call next Tuesday, simply by clicking a button during the call and putting this “follow up” on their to-do list for next Tuesday (or Wednesday or Thursday, etc.). As a result, the rep does not have to remember to send the email after the call and can put the reminder to call next week on their calendar just by clicking.

10 COMPONENTS OF A SALES ENGAGEMENT STRATEGY 1. Messaging: A framework for the key messages that will be delivered in all customer interactions, including personas, value propositions and case histories. 2. Content: The overall plan for content in go-to-market activities from marketing content such as white papers, blog posts and webinars to sales content such as email templates and collateral. 3. Channels: The mediums through which buyers and sellers engage. 4. Technology: A single interface to plan, execute, track, measure and optimize the interactions of sellers with buyers across multiple touches and channels. 5. Data: The account, contact, intent, activity, engagement and product data required to manage sellers and tailor experiences to buyers. 6. Workflow: Manual and automated processes required to create an interconnected engagement experience. 7. Touch patterns: A planned progression of communications across multiple channels directed toward specific prospects or accounts. 8. Enablement: The strategy and playbook for enabling sellers to take the right steps with buyers.

2022 Success Strategies

9. Metrics: Accurate assessments of engagement performance to monitor conversion, attainment of pipeline and revenue goals, and customer health. 10. Management: The organizational cadence of observing metrics, testing variations and prescribing improvements across all components of the strategy. SOURCE: TOPO Sales Engagement Leadership Report

Using sales automation as an onboarding and training delivery tool can improve the perceived value to both reps and managers, making it easy to scale growth. AI can create talk tracks automatically to create a comprehensive story-so-far. This enables managers to set follow-up calls with the reps they trained to make sure they are making the desired changes in their selling relationships, in real time. Sales managers also have the visibility into forecasted deals that an AI-generated story-so-far can provide. Features that highlight sections of

recorded calls allow managers to commend reps for doing a good job. This also gives managers the opportunity to suggest specific changes or to edit playbooks in real time to implement those needed changes across distributions or sales channels.

Building Work-From-Home Rep Confidence

People buy from people they trust. So how do you build a rep’s confidence in this new selling environment? By having a sales enablement process that reps trust so they can follow up with details on the points in

Buyers need sellers to exceed expectations at every interaction. Sellers must have the ability to facilitate buying decisions virtually. Selling teams can create extreme value when they are able to convert selling activities into revenue with state-of-the-art, role-specific, behavior-activated sales enablement tools. Our new selling environment and our 2022 success require a sales engagement automation strategy, personalized messaging and an effective sales engagement playbook strategy. We’re getting our sales enablement sales process fine-tuned. Is it time for you to do the same? Lloyd Lofton is the founder of Power Behind the Sales. He is the author of The Saleshero’s Guide To Handling Objections, voted No. 1 of the 11 Best New Presentation Books To Read in 2020 by BookAuthority. Lloyd may be contacted at lloyd.lofton@ innfeedback.com.

December 2021 » InsuranceNewsNet Magazine

More than 850 financial services companies in more than 70 countries turn to LIMRA first to help them build their businesses and improve their performance.

INSIGHTS

Strategies To Win The PostPandemic Talent War Employers must figure out how to design and implement a meaningful mission and experience for their current workers and prospective employees. By Alison Salka

he COVID-19 pandemic affected almost all aspects of the insurance business. One critical aspect of any business — attracting and retaining talent — has become more challenging. The U.S. Bureau of Labor Statistics estimates there are 10.9 million open jobs and 8.4 million unemployed potential workers. Executives LIMRA spoke to said it’s taking longer to find talent (especially for junior-level positions) and that candidates expect more from the employers with whom they choose to work.

Hybrid Is Here To Stay

Companies moved quickly to a remote model last year. This was intended to be short term but continued well into this year. Remote or hybrid work will become permanent for many companies. It may be necessary to find and retain people who prefer the benefits of a work-from-home arrangement and don’t want to work in a traditional office environment. In a recent survey of 16 life insurance company chief human resources officers, three-quarters said they are using more full-time remote or hybrid schedules to retain employees in certain critical or high-demand roles. They are commonly doing this for information technology, actuarial, underwriting and data analytics roles. Maintaining a distinct company culture and facilitating collaboration in a remote environment have become heavily discussed topics among executives. Some companies are considering outsourcing certain roles, since a remote employee and a contracted one do similar 52

work but expenses are lower when jobs are outsourced. In addition to culture, a remote work environment also affects wages. Compensation used to be a function of location, with certain metropolitan areas requiring higher wages due to higher expenses. Remote work makes it easier to match compensation to the requirements of the work. Talent matters more than location, and digital capabilities will drive engagement and collaboration. Remote work requires a good digital employee experience. One company executive told LIMRA they hired 30% of their

Branding isn’t just for marketing. Companies must outline a clear mission and value proposition for candidates. Competitive compensation and benefits are table stakes. A good “employee experience” is becoming an expectation as well. Employees want a voice in engineering their work experience and fitting their jobs to their lives, not their lives to their jobs. Employers who give their workers this freedom will benefit. Candidates want to know that their colleagues see them and care about them as multifaceted people. They also want their companies to care about issues outside the

In a recent survey of 16 life insurance company chief human resources officers, three-quarters said they are using more full-time remote or hybrid schedules to retain employees in certain critical or high-demand roles. workforce during the pandemic and didn’t meet a single candidate face-to-face. One good practice is to welcome new employees with a warm email and some company swag along with their equipment. It’s difficult to over-communicate with a new employee, and little gestures mean a lot. In the past, company perks were often specific to headquarters. Amenities such as on-site gyms, stores, masseuses and barbers don’t benefit a distributed workforce. With a remote workforce, perks need to transfer — providing a company store credit or a stipend or a gift card are more relevant ways to reward employees.

Matching Employer Value Propositions With Employee Experience

The insurance industry doesn’t have a reputation of being dynamic, which makes it challenging to hire young professionals. At the same time, many young people have inflated expectations of what their job should be and are willing to fight for it. And right now, they have leverage.

InsuranceNewsNet Magazine » December 2021

business, and they want their opinions and their employer’s opinion to be consistent. Potential employees care more now than previously on where a company stands on diversity, sustainability and social justice. If employees are physically distant at work, they must be socially connected. Showing interest in employees as people with multifaceted lives goes a long way toward engaging them. As an executive recruiter from Slayton Search Partners recently said, “The war for talent is over; talent won.” This doesn’t mean that the relationships between employers and employees can’t be win-win. Employers who figure out how to design and implement a meaningful mission and experience will be winners in any arena. Alison Salka, Ph.D., is senior vice president and director of LIMRA Research. She may be contacted at alison. salka@innfeedback.com.

Expand Your Reach With The

Petersen Platform of Specialty Markets.

Disability • Medical • Life • Athletes • Entertainers • Pilots • Contingency Coverages (800) 345-8816 | PIU@PIU.ORG

23929 Valencia Boulevard, Second Floor Valencia, California 91355

INSIGHTS

The Million Dollar Round Table is the premier association of the world’s most successful life insurance and financial services professionals.

Engaging The Five Senses To Cultivate Client Trust When you demonstrate your appreciation for your clients beyond the quality service you give them, you reinforce client loyalty and engagement. By Terri E. Krueger

e all want clients to know we care about them, their families, their experience with us and their general happiness. As we transition to seeing clients in person regularly again, that experience should begin the moment a client arrives in your office. Cultivating client trust isn’t just about the words you say; it’s about engaging all your clients’ senses and connecting with them emotionally. Taking this holistic, sensory approach will put clients at ease the minute they walk in the door, making it easy to create meaningful, powerful relationships.

Engaging The Senses

The first experience a client has of your office is your reception area. My office’s reception desk plays host to diffused lavender, peppermint and other oils. These aromas help put clients at ease and welcome them into our space. The visual focal point in our foyer is a kitchenette, which shows my office is not an uptight, business-only space, and reminds clients of their own homes. Additionally, every light in the office, from the recessed lighting to the chandeliers, are LED soft lights — there is no harsh fluorescent lighting. Our paint colors are warm and soothing to the eye. Again, all of this is to help clients relax into a space where they should feel safe and secure. Finally, clients can select from displays of chocolate truffles, snack bars and candy in every meeting area. Our refrigerator is full of several different types of cold beverages, and we have a fully stocked station for hot chocolate, tea or coffee. 54

Deliberate Gift-Giving

Gift-giving is standard among financial advisors, but don’t let standard become stale. Sending unique items to your clients, using your own personal style, will make your gifts more meaningful and more appreciated. For example, each new client of mine receives a coffee mug filled with a custom, individually wrapped and logoed chocolate covered cookie, a logoed pen, and my personal business card. Our logoed pens cost approximately $1.29 each, leaving clients with the impression of quality — in the pens and in the firm. Clients often come back to ask for another pen, which we always oblige — after all, that’s what they’re there for.

Sending unique items to your clients, using your own personal style, will make your gifts more meaningful and more appreciated. Clients with young children receive a book about raising financially aware children and a logoed piggy bank. The book is designed to teach children; however, the adults learn as they teach, removing any embarrassment that the adults may feel about their own lack of financial planning knowledge. During the pandemic, we also have given away logoed telephoto lenses that can be attached to any cellphone, and logoed luggage tags. By sending these items through the mail, we want to remind clients that they will begin traveling again one day, and the telephoto lens will allow them to see past where they’re currently standing and into a vacation-filled future. Finally, clients who send referrals to our firm receive a tote made by a known designer. I developed a relationship with a vendor so I can purchase full-value totes at clearance-level prices. For higher-networth clients, I have a bag custom-made

InsuranceNewsNet Magazine » December 2021

for them, embroidered with a symbol of an activity they enjoy — such as a golfer for my golf fans or a horseshoe for my equestrian enthusiasts. Of course, clients and their spouses also receive cards for life-changing moments: celebratory cards for birthdays, engagements or the arrival of a new family member; sympathy cards when we find out a loved one has died. Each card comes with a personal, handwritten message from me on the inside.

Service Above And Beyond

Clients will see you as even more of a go-to source of support when you provide small services beyond financial advising. For example, every six months, my office holds a Shred Day in which people can bring in any documents they would like to have us shred for them. During COVID19, we made the event a drive-up service. Each driver received a bag of goodies and a thank-you for attending the event. One month prior to the event, we sent a list of items to shred and timelines for which documents to keep or shred as well as a list of dos and don’ts. (For example, don’t include any metal binders.) The phrase sounds like a cliche, but it still hasn’t lost its meaning: People may forget what you did, but they will never forget how you made them feel. From the ambience of your office to the thoughtfulness of your gifts, when you demonstrate your appreciation for your clients beyond the quality service you give them, you reinforce client loyalty and engagement. Show your clients that you value them, and they are likely to return the favor. Terri E. Krueger is an independent financial advisor and seven-year MDRT member with three Court of the Table qualifications. She opened her own practice, Krueger Advisors, in Syracuse, N.Y., in 2018 and has been in the industry since 2007. She may be contacted at terri.krueger@innfeedback.com.

INSIGHTS

Founded in 1890, NAIFA is one of the nation’s oldest and largest associations representing the interests of insurance professionals from every congressional district in the United States.

Partner Marketing: A TwoWay Street To Growth Nurture this relationship like you would your best client, but evaluate it objectively to make sure you are sending and receiving your ideal clients. By Carina Hatfield

eady to work on your next marketing approach? Are you looking for a way to create lasting relationships and build a solid funnel of preferred introductions? Partner marketing might be the next thing to consider. What is partner marketing? This is a business-to-business relationship created with a common goal. You might also call it referral marketing or relationship marketing. For this to work effectively, you must look at your business and determine your ideal or niche client. Once you identify your ideal client, then you can explore the businesses or professional services this person uses in conjunction with yours. Does this person have a will or an estate plan in place? Then you may want to speak with an estate attorney. Is this person a classic car enthusiast? Then an auto restoration company, auction house or car club would be the right spot to start. Are you interested in local small businesses? The chamber of commerce or a business accountant provides services to your ideal client.

Do Your Homework

The next step is to do some research. Finding a company that aligns its values with yours is ideal. This can take some time, so don’t rush into a relationship with a company until you are ready. Your goals and objectives should be clearly defined and mutually agreed upon. You want to think about what you want out of the relationship. What are your expectations? How will each business benefit? Once you have narrowed down the partner you would like to work with, stop

and do some more research. What do their client reviews look like? What is the makeup of their professional network? How are they involved in the community? Where do their employees volunteer? What organizations do they sponsor? Ask yourself, does this align with my business? Depending on your marketing approach, the size of your firm, and what products or services you want to market and grow, you might want to work with several businesses at the same time. Whether they are the same type of business or different is something that should be shared and agreed upon from the beginning. What if you developed a relationship to get referrals for business insurance from an accountant and then find out they are referring home and auto insurance to someone else, and you also sell personal lines? Defining your services and to whom you want to be referred will eliminate any surprises and deepen the referral relationship.

Nurture Your Relationships

After you have finalized the company or companies you would like to partner with, set up a plan to check back in to make sure that the relationship is continuing to grow not only in the way you would like it to but also in the way the other company wants it to. Partner marketing is best when developed with referrals both ways. Keeping track of how many referrals come to you is just as important as the amount you refer to them. Treat your check-ins like a business meeting with a client, be prepared with an agenda, monitor progress and discuss next steps. Now that you have the clients coming in, let’s discuss your continued relationship with them. When a prospect reaches out to you, remember to ask them who referred them or how they found you. Let the person know you want to thank the person or company that referred you. Tracking this through your customer relationship management system is the best way to keep track of where you are getting business.

Send a thank-you card or a gift to the referral source so they know you appreciate them. Feedback to the referral partner is key. Are they sending you your ideal client or are they only sending you someone who sort of needs your advice? After you have converted the prospect to your client, you must evaluate your service model and plug them into your system. Most likely, you are scheduling reviews either every quarter, semiannually or at a minimum annual basis. How else do you stay in touch with your clients? One way is through your partner marketing. Co-hosting a client appreciation event is an easy way to continue the relationship with your marketing partner and also stay in touch with your clients. This could be something like offering a lunch and learn, co-hosting a webinar or event, featuring your partner in your newsletter or on social media, or sharing in volunteer opportunities. The most important part of referral or partner marketing is to make this commitment a part of your business strategy. Nurture this relationship like you would your best client, but evaluate it objectively to make sure you are sending and receiving your ideal clients. Those ideal clients make your service model easy to follow and the work with your partner enjoyable and rewarding. Carina Hatfield, LUTCF, CLCS, LACP, is the owner of Weigner Insurance & Financial Services in Pottstown, Pa. She is president of NAIFA-Pennsylvania, chair of NAIFA’s National Young Advisor Team, and the 2020 recipient of NAIFA’s national YAT Leader of the Year award. She may be contacted at carina.hatfield@innfeedback.com.

December 2021 » InsuranceNewsNet Magazine

INSIGHTS

With nearly 100 years of experience, The American College is passionate about helping students expand their knowledge and opportunities as financial professionals.

Support Client Desires To Make A Difference How to turn a simple gesture of giving into a journey of self-discovery and fulfillment. By Dien Yuen

iving is a noble act regardless of the amount, motivation or approach. It can be an impulse to show kindness that can take place anytime and anywhere. Or it can be a commitment to tackle a social issue that goes beyond personal satisfaction. As a trusted advisor, how can you support your client’s desire to make a difference, which in turn will support your business as well as our communities? Here are some steps that you can share with your clients and help turn a simple gesture into an amazing journey of self-discovery and fulfillment.

Step 1: Dig In A Bit More.

Worthy causes are everywhere — from great social needs such as education, health and the environment to investing in arts, culture and much more. There is no harm in supporting any project that appeals to you or is brought to your attention by a friend or family member. You can develop a clear focus by zeroing in on what you care about and want to help change. If your cause is helping children, is there a specific age group, geographic location or life circumstance that you care about? If you can drill down and narrow your interests sufficiently, your efforts can bring about meaningful and lasting change to a particular aspect of the more significant issue.

f Consider supporting the truly disadvantaged groups in the area you focus on. Sometimes the groups most in need are those that are marginalized, such as ethnic minorities, girls, senior citizens or particularly vulnerable populations. 56

f Does backing social entrepreneurs

and market-based solutions seem more appealing? If yes, look at their business models, check their results and see who else funds them. Does their track record show they can scale and bring about significant changes in the status quo?

f Do you care about addressing imme-

diate needs or would you rather address the more difficult work of getting at the root of the problem? Be curious. Ask why the situation is what it is. You can ensure that you are part of the solution instead of supporting unintended consequences.

Step 2: Search For Organizations That Align With Your Goals.

When you have a better idea of what you want to focus on, the next step is to find great organizations or projects that match your goals. Connect with and learn from others who might be interested in the issues and groups they support. If your focus area is your local community, contact your community foundation, a special type of charity that serves a specific city or region. You can see what they fund, ask for recommendations or fund their special initiatives. Regardless of who you partner with, it is helpful to listen to their priorities.

f Look into philanthropic online mar-

ketplaces and crowdfunded sites for ideas. These groups list hundreds of specific projects that donors can give to.

Step 3: Give Efficiently And Wisely.

After selecting the nonprofits you want to help, the next step is to make a gift that works for you and the organization. The easiest way to make a gift is to write a check or make a credit card donation online. However, sometimes, making the best gift requires some extra planning. For example, instead of cash, you can donate highly appreciated, publicly traded stock,

InsuranceNewsNet Magazine » December 2021

allowing you to realize far more significant tax savings.

f Consider an “unrestricted” or “gen-

eral operating” support gift that can be used for pilot projects or strengthening the organization. Charities need to keep their lights on to function, so allow for some measure of overhead costs too.

Step 4: Follow The Gift

The giving journey is inherently personal, and the path you chart should resonate with your values and experiences. At the same time, revisit motivations that guide your giving and pivot as your mindset evolves. When it comes down to it, for a donation of any amount of your hardearned money, be sure you know what will happen and that you are excited about it!

Whether it’s taking a board seat, spending several hours tutoring a child, or helping a nonprofit plan an event, consider volunteering for groups you align yourself with. You can easily make a charitable gift to any nonprofit as a gesture of your generosity, but choosing a cause or a group that is meaningful to you and your family, for any amount, requires some thought. The energy, time and initiative that you invest in the giving journey can be transformative, or at least personally rewarding and educational. Dien Yuen, JD/LLM, CAP, AEP, holds the Blunt-Nickel Professorship in Philanthropy at The American College of Financial Services, where she teaches in the Chartered Advisor in Philanthropy program. She also serves as program director of Purpose School, a program she co-created for leaders exploring the intersections of personal purpose and impact. She may be contacted at dien.yuen@innfeedback.com.

Not Your Everyday Insurance Credit Line For clients looking for extra money to meet their needs, their whole life insurance policy may be the answer. With an Investors Insurance Credit Line, it’s easy to borrow against the equity in their policy. Unlike similar products that can call for repayment or a change in terms at any time, ours is locked in for a 7-year term. It’s one more offering that can help build stronger relationships with your clients. • Competitive tiered variable rates with a 7-year term • Up to 95% of cash value of a whole life insurance policy* • Minimum credit line of $65,000 Visit us at investorsbank.com/insurancelending to download our fact sheet or email us at insurancelending@investorsbank.com

* Policy must be in effect for at least 12 months at the time of credit application. Insurance policy must be issued by one of the following approved insurance providers to be eligible for IBLOC collateral: Guardian, MassMutual, Northwestern Mutual, NY Life, MetLife, John Hancock, Penn Mutual, Ohio National, Brighthouse Financial, Lafayette and Ameritas. Other restrictions may apply. Investors Bank name and weave logo are registered trademarks. ©2021 INVESTORS BANK. ALL RIGHTS RESERVED.

New Year. Best year. We help advisors save time, win prospects, and better serve their clients — so they can focus on making 2022 their best year yet. Learn how Brookstone’s Turnkey Asset Management platform can help make it happen.

Learn more at brookstonecm.com

InsuranceNewsNet Magazine - December 2021

Articles inside

Filling The Generational Pipeline

3 Ways To Make HSAs The Choice For Employees

Great Seller Experiences Facilitate Better Buying Experiences

Rollovers In The Crosshairs

Shift Your Talk, Change Your World