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Life Annuities Health Financial

November 2013


PLUS How to Finally Write Your Own Book PAGE 12 Overcoming the Top 5 Annuity Objections PAGE 52

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50 I mmediate Security for Families of Those with Special Needs


8 Neasham Looks to Uncertain Future Even after Winning Appeal

22 Upward Mobility

By Steven A. Morelli An InsuranceNewsNet poll and LIMRA research show that many advisors are unsure about how to incorporate mobile technology into their practice while other advisors wonder how they could ever do business without it.

By Steven A. Morelli Glenn Neasham is putting his life back together after a California appellate court threw out his felony theft conviction in the sale of an annuity to an 83-year-old woman.



32 Special Sponsored Tech Guide Section Industry leaders discuss how to be successful with technology.


42 The Right to Deny When Clients Lie By Tom Virkler Clients need to be reminded that dishonesty when applying for coverage can result in a denial of claim.

12 H  ow to Finally Write Your Book

An interview with Michael Levin You may have an impressive-sounding job title, and a string of designations behind your name, but calling yourself an author is a way to command respect from any audience. Writing a book may sound like a daunting task, but it’s not impossible, says Michael Levin. He should know; he has written, co-written or ghostwritten more than 150 books, of which nine are national best-sellers. In an interview with InsuranceNewsNet Publisher Paul Feldman, Levin describes how anybody can build a book.


44 Multi-Tasking Women Demand a Multi-Task Asset By Liz Michel and Cathy Neifeld Permanent life insurance can play many roles in a young woman’s financial future.


InsuranceNewsNet Magazine » November 2013

By Daniel Herr The security in knowing that a family member will have sufficient financial resources can help to offset the fees or expenses associated with an annuity.

52 O  vercoming the Top 5 Annuity Objections By Eric Taylor Helping your clients understand the facts about annuities can demonstrate your value as an advisor and create new business opportunities for you.


56 H  ybrid Policies Add to the LTCi Market Challenge By Susan Rupe Consumers have more options to consider when purchasing the right long-term care coverage for their needs and their budget.

60 S tudy Group Evolves into Team of Retirement Experts By Vivian Gallo A group of advisors found that banding together to learn more and to share their knowledge led to forming relationships with other professionals and obtaining referrals.


64 Wanted: Retirement Advisors Ron Mastrogiovanni Aging consumers are seeking answers as they make the transition into retirement, and advisors who fail to uncover their solutions will be left far behind.

METLIFE IS TURNING OVER A NEW LEAF IN INDIVIDUAL DISABILITY INSURANCE. We’ve changed our approach to fit your needs. • E xperience our streamlined service, refined medical guidelines and lower premiums for many of your key clients. • O ur versatile, new MetLife Income GuardSM disability insurance product has hit the market* with some of the industry’s highest coverage limits and competitive prices. Visit to learn more. *Not available in all states. For Producer Use Only. Not for Use With the General Public. ©2013 Metropolitan Life Insurance Company, New York, NY 10166 L0713334534[exp0814][xGU,MP,VI] PEANUTS © 2013 Peanuts Worldwide 1310-2996


69 N  AIFA: Advisors are Helping their Clients Navigate the Intricacies of ACA


By John Nichols Insurance professionals are reaching out to offer their expertise as implementation of the Affordable Care Act moves forward.


70 LIMRA: Multiple-Line Exclusive Agent Channel Poised for Growth

66 L essons in Cruising Wealthy Circles By Bryce Sanders An environment populated by wealthy people, such as a luxury cruise ship, gives you the opportunity to network with potential high-net-worth clients.

By Laura Murach MLEAs are a unique distribution channel that offers challenges, as well as limitless opportunities.

72 The Last Word: Put Down the Device and Read


68 MDRT: Hot Technology for Top Advisors

By Larry Barton Spend more time educating yourself on the financial issues that are on your clients’ minds.

By J. Leland “Lee” Davis Combining great technology with your unique talent for taking care of clients can take you to the next level in record time.

EVERY ISSUE 6 Editor’s Letter 18 NewsWires

40 LifeWires 48 AnnuityWires

54 HealthWires 62 FinancialWires

INSURANCENEWSNET.COM, INC. 355 North 21st Street, Suite 211, Camp Hill, PA 17011 tel: 866-707-6786 fax: 866-381-8630 PUBLISHER Paul Feldman EDITOR-IN-CHIEF Steven A. Morelli ASSISTANT EDITOR Susan Rupe CREATIVE DIRECTOR Jake Haas PRODUCTION EDITOR Natasha Clague SENIOR GRAPHIC DESIGNER Carlos Centeno MARKETING STRATEGIST Katie Hyp DIRECTOR OF MARKETING Anne Groff AND SALES TECHNOLOGY DIRECTOR Joaquin Tuazon




Copyright 2013 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, send your letter to 355 North 21st Street, Suite 211, Camp Hill, PA 17011, Fax at 866-3818630, or call 866-707-6786. Reprints: Copyright permission can be obtained through InsuranceNewsNet at 866-707-6786, Ext. 115 or reprints@insurancenewsnet. com. Editorial Inquiries: You may e-mail or call 866-707-6786 ext. 117. Advertising Inquiries: To access InsuranceNewsNet Magazine’s online media kit, go to, or call 866-707-6786, Ext. 115 for a sales representative. Postmaster: Send address changes to InsuranceNewsNet Magazine, 355 N. 21st Street, Suite 211, 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 expressed 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 unauthenticity of, the information published herein.

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6000 Westown Pkwy, West Des Moines, IA 50266 | | 888-647-1371 13 INN 11.13 FOR AGENT USE ONLY. NOT FOR USE IN SOLICITATION OR ADVERTISING TO THE PUBLIC. November 2013 » InsuranceNewsNet Magazine 5



A Fair Question


HAT DO YOU HAVE? When you hear that question, do you think about your assets? If so,

what are they? Some of us will think of a car, a house, a boat, investments, electronics and other stuff. Others will think of their health and a wealth of days ahead of them. And still others will treasure their family and friends. In fact, all of us have valued many of these things simultaneously. Sometimes we lie to ourselves about the order of our list, putting at the top what we think we should, but secretly valuing something else. Calamity creates clarity. Each of us will have a day that upends that list. It might be the moment you hear, “You have cancer” or “There is nothing more that we can do” or “I’m leaving.” In Glenn Neasham’s case, it was the day he was told, “You are under arrest.” For Neasham, that clarifying moment was the sound of a gate opening to release a hellish pack of events. Before that moment in 2010, he was a happy insurance agent making more than $400,000 annually in a California lake town, living in a beautiful home with his wife and three children, and planning to build an even better dream home. Today, he is without an insurance license, supporting his family with public assistance, living in a house rented from his in-laws and filing for personal bankruptcy. Keep in mind that he “won” his case. In the end, he had done nothing illegal, according to an appeals court ruling in October. The justice who wrote the decision was baffled even by the prosecution’s definition of theft. The ruling makes it abundantly apparent that this was a trial that never should have happened. The sheer absence of a case was what Neasham depended on from the beginning. All he did was sell an 83-year-old woman an annuity that his state said was legal to sell to anyone up to 85 years old, yet he was charged with felony theft. The client turned out to have dementia, although it was not proven in trial that she was mentally impaired when she 6

bought the annuity. In fact, the prosecutor said she never even proved that Neasham or his assistants ever saw any sign of cognitive impairment in the client. On top of that, the appeals court said that even if Neasham knew, it still would not have been theft because he never got any money directly from the client. The client eventually was refunded the full value of the annuity plus interest. It turned out that the only theft was of Neasham’s career and earnings. The day after Neasham learned he won his appeal, he was still dazed. It was the same disorientation seen in someone sitting amid the debris left after a hurricane, not completely certain of what happened and not sure of what’s left. But as Neasham assessed his situation, he saw some things he won during his trial. The first thing on his list was his family. He had a wife who stuck by him and, as a stay-at-home dad, he got to know his kids. He was there for the big moments he would have missed otherwise. He is not living in his dream house on a hill but he is living the dream he had of having a close family. He now knows he doesn’t need the fancy house or car. He just wants enough to support his family comfortably. He said he’ll be happy to make a small fraction of what he used to earn. He also learned the value of friends, people he didn’t even know before his arrest. Two key figures helped Neasham obtain a pro bono law firm that eventually won the appeal. They were Larry Nevonen and Dick Weber. Nevonen is an insurance producer and attorney in the Los Angeles area who was appalled by the injustice. Weber was the president of the Society of Financial Service Professionals who saw not only the injustice but also the harm that the precedent could set for everybody else. While others argued whether indexed annuities are good products or whether Neasham should have sold one to an elderly client, Nevonen and Weber stepped forward and said there is a person in the center of all this. And that person could have been anybody who has

InsuranceNewsNet Magazine » November 2013

ever sold an annuity to anyone. They had empathy, an eye toward the greater good and the drive to right a wrong. Heroes are not caped crusaders who leap tall buildings and lift cars off victims. They are the ones who work tirelessly to help long after everybody else gawked, offered an opinion and moved on. This knowledge is something else Neasham has, his understanding of true grace. We can make a difference that multiplies down the line, but usually not in the big events in which headlines are made. In fact, when we show small compassion in our everyday lives, we set in motion the things that prevent cataclysm. The county district attorney could have put ambition aside and could have seen that the Neasham case was an unfair prosecution that would eventually destroy a business that a family relied on. A dad could have cancelled a regular Saturday morning tee time and spent time with the son he barely knew and later went awry. A driver could have eased off the gas just slightly, yielded to someone merging into traffic and prevented a fatal pile-up accident on the entrance ramp. It all stems from understanding that there is always a person in the center of these things, somebody who could easily be you or someone you love. Neasham had to lose quite a bit to find these gifts. Sometimes that is the only way many of us earn understanding. So, before you move on, let me ask you this again: What do you have? Steven A. Morelli Editor-in-Chief


HOW WELL DO YOU KNOW THE PEOPLE WHO COULD TRANSFORM YOUR BUSINESS? African Americans, Hispanic Americans and Asian Americans are not just growing demographic segments. They’re growing economic forces, with buying power on the rise. U.S. POPULATION GROWTH COMING FROM MULTICULTURAL GROUPS, 2000-2010*

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*“When Multicultural Is the Culture: Marketing to the New Face of America,” 2011, The Nielsen Company; 2010 Census, Nielsen Analysis. **Ackerman, Ruthie, “Women & Investing: Why Many Advisers Are Missing Out.” Investment News, April 2012. Life insurance is issued by The Prudential Insurance Company of America, Pruco Life Insurance Company (except in NY and/or NJ) and Pruco Life Insurance Company of New Jersey (in NY and/or NJ). All are Prudential Financial companies located in Newark, NJ. Availability of insurance and rates will vary based on the satisfaction of underwriting criteria. Underwriting rules are subject to change at our discretion. Prudential, the Prudential logo, the Rock symbol and Bring Your Challenges are service marks of Prudential Financial, Inc. and its related entities, registered in many jurisdictions worldwide. © 2013 Prudential Financial, Inc. and its related entities. FOR THE EDUCATION OF PRODUCERS/BROKERS ONLY. NOT FOR USE WITH THE PUBLIC. 0251837-00001-00 November 2013 » InsuranceNewsNet Magazine


For full Neasham case coverage, visit our special section online.


Neasham Looks to Uncertain Future Even After Winning Appeal arrest, conviction and 60-day prison sentence in connection with the annuity sale. Neasham, a 53-year-old advisor from Hidden Valley, Calif., had been convicted in October 2011 of felony theft from an elder in a California court for selling an Allianz MasterDex 10 in 2008 to an 83-year-old woman who was later said to have suffered from dementia. Neasham was facing up to four years in prison but the sentence had been reduced to 60 days. On Oct. 8, the First Appellate District Court reversed the conviction in a decision that seemed to ridicule the prosecution. “Under the prosecution’s theory of this case, merely cashing a check for a person known to suffer from dementia would support a larceny conviction,” Associate Justice Stuart Pollak wrote in the ruling.

G  lenn Neasham is trying to get his insurance license back, file for bankruptcy and start anew. As he takes stock of his life and future, Neasham said he is thankful for some things that have come out of his legal ordeal. By Steven A. Morelli


early two years to the day after a jury found Glenn Neasham guilty of felony theft for selling an annuity to an 83-year-old woman, a California appellate court threw out his conviction. InsuranceNewsNet readers may remember our March 2012 exclusive investigative report, “American Injustice,” in which we revealed the untold story behind Neasham’s

The prosecutor had argued in the original case that Neasham should have known the client, Fran Schuber, had dementia, even though Neasham and his assistants said that they Glenn Neasham did not notice any cognitive impairment and that Schuber had said in a questionnaire that her health was “good.” At that time, California allowed the sale of that annuity to clients up to age 85. In their decision, the three appellate justices agreed that the prosecutor did not prove theft because the annuity sale amounted to an exchange of equal value and the state did not prove that there was intent to steal. The judges’ decision to overturn the


FEB. 1, 2008

Fran Schuber, then 83, and her boyfriend, Louis Jochim, make an unsolicited visit to Neasham Insurance Agency in Lakeport, Calif. Jochim tells producer Glenn A. Neasham that Schuber has a CD maturing that month and wanted to talk about an annuity similar to the Allianz indexed annuity that he had. Neasham takes information and gives the couple material on the Allianz MasterDex 10.

Department of Insurance investigator interviews Schuber and Jochim.

Jury finds Neasham guilty of the theft but not the two special allegations. During the trial, Neasham’s lawyer argues that there was never a theft and that Schuber still had the annuity, which had gained more than $40,000 in annuitization value, and she had not taken a penalty-free, 10 percent annual withdrawal.

FEB. 13


During policy delivery, Neasham has Schuber and Jochim sign letter verifying Schuber’s choice of Jochim as beneficiary.

Lake County District Attorney investigator interviews Schuber and Jochim. Schuber says she is happy with the investment but investigator notices signs of dementia. The session is audiotaped but prosecutors would not reveal the existence of the tape for three and a half years, just before closing arguments in Neasham’s trial.




Neasham spends an hour and a half on his presentation and the application. In addition to considering what to do with $239,000 from a CD, they looked at Schuber’s entire financial picture. They decided to leave $100,000 in CDs and bank accounts, allowing for a monthly income, and to purchase a $175,000 MasterDex 10. In a questionnaire, Schuber says she was in good health and Neasham does not observe signs of dementia.

2 011

MARCH Lake County District Attorney’s Elder Abuse Unit gets case after a notice from the bank that holds CD indicating the bank manager’s concern about Jochim’s possible undue influence over Schuber.


InsuranceNewsNet Magazine » November 2013

Neasham has annual review with Schuber. Neither Neasham nor his assistant notice any signs of dementia.

DEC. 8, 2010

District attorney’s office refers case to California Department of Insurance.


MARCH 2011


FEB. 4


DEC. 3

During a three-day preliminary hearing In March 2011, Deputy District Attorney Rachel Abelson said she had records showing that doctors had diagnosed Schuber with “Alzheimer’s-type dementia” in 2003. Superior Court Judge Richard Martin allows charges but says the prosecution met the standard by the “thinnest of lines.”

A criminal complaint was filed against Neasham and he was arrested Dec. 14. Neasham is charged with theft from an elder, a felony, and two special allegations, one of which stipulates that the theft exceeded $100,000.

Do MEDICAL conviction of theft in what was a simple annuity sale might have seemed like an obvious outcome to observers, but Neasham has learned the hard way not to assume anything in a court. After all, Neasham went from making more than $400,000 a year with a thriving insurance business supporting a wife and four children in an elegant house in a northern California lake town to living in a house provided by his in-laws. His wife returned to work as a dental assistant and the family subsisted on food stamps. He went from parsing the details on building a dream house on top of a hill to learning the intricacies of filing for personal bankruptcy. All because of a verdict few thought could have happened in a case that baffled even the most advanced legal experts. Supporters and lawyers in his appeal told Neasham he had a rock-solid case, but he’s heard that before. “My attorney in the very beginning said there wouldn’t be a conviction on this and of course there was and I was absolutely shocked,” Neasham said. Many in his community and in the life insurance industry shared his sense of

MELINE FEB. 29, 2012

Judge Martin rejects Neasham’s request for a new trial and sentences him to the 300 days in jail, which he reduced to 60 days. Neasham plans to appeal to a higher court. If a new trial is granted, Neasham says he will not be able to afford his lawyer and will need a public defender, which he qualifies for, along with food stamps.

2013 MARCH 20, 2012 Judge grants Neasham $20,000 bail, allowing him to stay out of jail pending appeal. Neasham posts bond.

OCT. 8, 2013 California First District Appellate Court, Division Three, files decision to reverse the conviction.


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shock. Even the prosecutor admitted she did not prove that Neasham knew that his client suffered from dementia, which was one of the basic points of her case. In the original trial, Neasham’s attorney advised him not to testify because he felt the state did not show it even had a case. The decision not to testify is one of the many things Neasham now wishes he could do over. But a mistake he isn’t repeating is taking things for granted in court. That’s why even though the three-judge appeals court panel seemed to have shredded the prosecution’s case in the September hearing, Neasham was checking the court’s website every 15 minutes for the decision ever since. On Oct 8., when he saw The People v. Glenn Andrew Neasham, he sat down, calmed himself and opened the file. In the decision, Justice Stuart Pollak point-bypoint showed the prosecution hadn’t even come close to proving Neasham committed theft and that the judge erred so badly in his instructions to the jury that the mistake had “constitutional significance.” Pollak seemed to be perplexed even by the prosecution’s definition of theft. “Under the prosecution’s theory of this case, merely cashing a check for a person known to suffer from dementia would support a larceny conviction,” Pollak wrote. Larry Nevonen, a longtime proponent of Neasham’s who attended the appeal hearing, said he was almost embarrassed for the state’s attorney. “The judge asked the hypothetical that if you gave him a hundred-dollar bill and he gave you five twenties would that be theft,” said Nevonen, who is an insurance agent, professor and lawyer. “And she hemmed and hawed and finally said ‘Yes.’ Another judge asked, ‘Are you aware of the implications of what you are saying?’ ” But Nevonen understood why Neasham, who is unfamiliar with the appellate court process, would have been nervous about the outcome. That’s because Neasham’s lawyer was first in the proceeding and a judge went after him with questions about the client’s ability to consent. Neasham remembered stiffening at the table as the judge “hammered” at his lawyer. “My wife and I weren’t sure really what happened,” Neasham said after the hearing. “We’re just hoping.” The anxieties that filled out the 10

THE APPELLATE COURT RULING SAID Prosecutors did not prove Neasham knew of the dementia: “All of the witnesses to the discussions between Schuber and defendant confirm Schuber’s apparent comprehension at the time of their conversations, and prosecution witnesses acknowledged that persons with dementia can have periods of apparent lucidity.” (In an interview with InsuranceNewsNet after the verdict, the prosecutor admitted that she did not prove that Neasham knew Schuber had dementia.)

If Neasham knew of the dementia, the prosecution still did not prove larceny: “Defendant received Schuber’s cashier check payable to Allianz and transmitted it to the insurance company, which issued her the annuity policy. He did not take her funds or convert her property for his own use or the use of any other person.”

Schuber was not deprived of her money: “The annuity was issued in Schuber’s name and she at all times was the owner of that policy. For 30 days after its issuance, she had the unqualified right to cancel the policy and receive back the full price paid for the policy. While the prosecution placed great emphasis on the penalty she might have incurred had she withdrawn more than 10 percent of the policy value within five years of its issuance, there was no evidence that Schuber had any intention or need to make such a withdrawal, the penalty did not apply if she became hospitalized or moved to a long-term care facility and, most importantly, there was no evidence that this standard term reduced the value of the policy to less than she paid for it.” After Neasham’s conviction, Allianz refunded Schuber the value of the annuity plus interest promptly after Schuber’s son asked for the money. The Schuber family had not asked for a refund before the conviction. Fran Schuber has since died. The prosecution can now appeal the verdict or retry the case. An appeal would have to overcome a jury instruction error noted in the ruling. A retrial would also have to grapple with the appellate ruling’s rejection of the basic premise of theft in the prosecution’s initial case.

Neasham family’s life since county investigators started asking questions in April 2008 finally unbuckled when he told his wife and mother about the appellate decision. “We all just started bawling,” Neasham said. “My wife, myself, my mom. We couldn’t say anything. We just cried.” The next step for Neasham is to try to get his insurance license back, file for bankruptcy and start anew. As he takes stock of his life and future, Neasham said he is thankful for some things that have come out of the ordeal. “I’ve gotten to know my kids better,” Neasham said. “I am not so concerned with some things anymore. I don’t need the big, fancy house. I don’t need the nice car.” Neasham said he is also grateful for Nevonen and a core group of supporters who pulled him through. Nevonen said Dick Weber, as president of the Society of Financial Service Professionals (FSP), was instrumental in rallying the association to back Neasham’s case. Weber, a California insurance advisor, said the implications of the case were clear to him. “It wasn’t just what was happening to Glenn, but to all of us,” Weber said of the

InsuranceNewsNet Magazine » November 2013

precedence the case represented. Weber and FSP retained a law firm to file a friend of the court brief that helped support Neasham’s appeal and was cited in the appellate decision. FSP’s attorneys also helped find the law firm that took over Neasham’s appeal free of charge when it appeared that Neasham’s court-appointed attorney was overwhelmed by the case. Prosecutors can still appeal the decision and retry the case. Nevonen said he thought both were unlikely because the Supreme Court would kick back an appeal due to the faulty jury instruction and a second trial would have to rely on new facts that would damage the prosecution’s case even further. “So, I don’t think they would have anything to build a new case on,” Nevonen said. But Neasham has heard that before. Steven A. Morelli is editor-inchief for InsuranceNewsNet. He has more than 25 years of experience as a reporter and editor for newspapers, magazines and insurance periodicals. He was also vice president of communications for an insurance agents’ association. Steve can be reached at smorelli@

November 2013 Âť InsuranceNewsNet Magazine



ven in this fast, cynical digital age, one kind of person still commands respect. The title itself carries gravitas: author. If your seminars seem to be a grind and you have to beg for attention, you can turn that around so that people come to you, eager to listen. Not only that, but they will already know your back story and want to hear more about you and what you do. First, you have to write a book. That might sound daunting, but Michael Levin is a highly successful ghostwriter who can break down the process piece by piece so not only is it achievable but it can be an enriching exploration of your career and your business strategy. Michael has written, co-written or ghostwritten more than 150 books, of which nine are national best-sellers. You might remember him from his appearance on the ABC-TV reality show, Shark Tank, early last year. Although they didn’t invest in his business, he is working on his second book with one of the sharks. 12

InsuranceNewsNet Magazine » November 2013

Michael has produced books with Simon & Schuster, Random House, St. Martin’s Press, Putnam/Berkley and other prestigious publishers. His works have been optioned for film and TV by Steven Soderbergh/Paramount, HBO, Disney, ABC and others. One of his own novels became Model Behavior, an ABC Sunday Night Disney Movie of the Week. He has contributed to major newspapers such as The New York Times, The Wall Street Journal, and the Los Angeles Times. He has taught writing at the University of California, Los Angeles and New York University. In short, Michael knows the writing business intimately. So, his generosity in describing how anybody can produce a book was a special treat in this discussion with Publisher Paul Feldman. In this interview, you will see how to build a book the easiest way possible. In Part 2 next month, Michael will discuss how to market your book so that prospects will come to you, wanting to do business because they know that you are a perfect fit for their insurance and financial needs.

Michael Levin ghostwriter and founder of Business Ghost



FELDMAN: Why does an insurance advisor need to have a book?

FELDMAN: Sounds great. So do you start by thinking about the subject?

LEVIN: The biggest challenges for anyone in financial services are establishing preeminence and answering the question of why someone should do business with you. The challenge is how do you get people to buy a product that they’d rather not even think about and when your basic tools as an advisor are pretty much the same as all of your competitors? Maybe you have a really nice website. So does everybody you’re competing against. You might have a social media feed. But are people really deciding whom they’re going to buy insurance from based on what they see on Twitter or Facebook? I’m not convinced that that’s the case. So when you have a book, you have a level of authority that nothing else in our society can confer upon you, certainly in marketing. I had a client who sells long-term care insurance. It’s a complicated product. It takes a long time to explain. There are a lot of moving parts. She would do a lot of free client education and then at the end of the process the prospect would say, “I appreciate everything that you’ve told me. I am going to buy it, but if I don’t buy it from my brother-in-law, my wife’s going to kill me.” Then she did a book on how longterm care insurance fits into the overall process of keeping yourself or your loved ones out of nursing homes. And once that book came out, besides making the Million Dollar Round Table, she no longer had the brother-in-law problem. Once people read the book, they realized, “This person really is the expert. I cannot go anywhere else.”

LEVIN: The first step in thinking about a book is realizing that you could write not just one, but a hundred different books, because you know so much more than you realize about insurance, about life, about people, because you see so much as an insurance professional. So the starting point is asking not what the book is going to be about, but whom do I want to influence? And with that, ask yourself, who do I want to be in the marketplace – the person I am now, or someone slightly different going after a different audience? That’s an extremely useful exercise, because when you start with that, then everything else falls into place. Once you decide, “I want more of what I’ve got,” or “I want some different group,” you can then ask, “What is it that I know that would lead them to engage with me?” FELDMAN: Do you need to start your book by knowing what you want your readers to do when they finish it? LEVIN: That’s exactly right. You’re beginning with the end in mind, because otherwise, you can just kind of wander off into a haze of glittering generalities and nonspecific whatevers, and never get anything important done. Once that’s done, you take that body of knowledge you’ve identified as the information that’s going to convince that group to take that next step, and you just chunk it down. And you say, “How do I break this down into six or eight steps or parts?” I always advise your first chapter should be “I feel your pain” – the famous Bill Clinton line.

FELDMAN: What about advisors who say they don’t have enough time or who say they’re not a writer? LEVIN: Well, that’s why God created ghostwriters. We work with people and get their books done for them in a minimum amount of time. But, I’ll walk you through a process by which your readers can create their own books without the need of a ghostwriter, and without spending a lot of money or time. 14

InsuranceNewsNet Magazine » November 2013

Most people think that they should start by establishing their qualifications, but that implies that the reader really cares about them. In reality, the reader only cares about the reader. Bring the pain, although not too much that they just can’t bear it, but enough that they’re feeling it in the 45 minutes to an hour it takes them to read the book. Then chapter two is, “I am the solution. I’ve done this before. I’ve handled this for other people. I have enormous expertise.” This is where you bring your qualifications. Chapter three is “what is your process?” Then the next several chapters – four, five, six, seven, eight – should be either different steps in your process of how you take care of people or different aspects of the problem that you solve. Then wrap it up with a call to action in the final chapter. Then you don’t have to write a word to create a book. What you need to do instead is have someone on your team, or a trusted friend, or even a grad student in English or journalism from the local university interview you for an hour per chapter. And just do a file dump on them. Tell them everything you’ve ever known, believed, experienced, seen, all the case studies, war stories, anything about the topic in that chapter. And just do it chapter by chapter. Then hire that journalism student to edit the interview into a 12- to 15-page document, which we’re going to call a chapter. Do that eight times, and then you have a manuscript. Then whether it’s to yourself or to the ghostwriter, tell the person who’s doing the interviewing, “I want each chapter back in my inbox within 10 days of our call.” Set a deadline so that it helps keep momentum up.

You could write not just one, but a hundred different books, because you know so much more than you realize about insurance, about life, about people.


Michael pitching Business Ghost on Shark Tank. FELDMAN: How much time should someone expect to spend on creating a book? LEVIN: If you’re diligent, you can be done with your book and have it in hand in four to five months. FELDMAN: How do you keep your momentum after you’ve started? LEVIN: That’s a really great question. I say that momentum is more important than quality when it comes to books. And people hate it when I say that. I taught book writing for 11 years at UCLA, three years at New York University and around the world at private seminars, and they all get outraged when I say that. But I say, “Here’s my proof – have you ever bought a bad book?” And they all say, “Yeah, I guess so.” The simple reality is that every single bad book that anybody ever bought or read, they all have one thing in common: the author finished it and got it out there. There are so many wonderful, useful, impactful, powerful, half-written books that are sitting in people’s drawers or on their hard drives and are creating no value for anybody. So the way to achieve momentum is to just make sure you get that first draft finished. If you’re doing the book yourself, schedule all of the interviews with yourself that will be the basis for the book. Set deadlines to write each chapter. And make those scheduled times sacrosanct.

FELDMAN: Whether someone’s writing it themselves or having it ghostwritten, you talk about working through the process one chapter at a time. LEVIN: We want to take the quality to that highest level not in the first draft, but in the second draft, and then in the revision process. So this piecemeal process takes all the pressure off because you’re no longer expected to get it right the first time. FELDMAN: Does perfectionism kill momentum? LEVIN: It is death for a writer, because once you start thinking, “I’m writing a book,” you start thinking Hemingway, Proust, James Joyce, John Grisham – whomever. You get into this mindset of, well, my book has to be at least as good as the best book that’s ever been written. No, it doesn’t. It just has to be good. You’re selling insurance. Let’s keep things straight. You’re telling a story about yourself so that you can help peo-


ple and you can make sales. So when people get into perfectionism, they are worried that if every word isn’t exactly right, and if every turn of phrase isn’t just phenomenal, then people will laugh at them. And this thing is in print, and they can’t call it back, and so on. The simple reality is that when you’re writing your first draft, a first draft is not the final draft. You will have time to revise. You will give it to other people, and they will point out the things that need to be changed. I always tell my students and my clients the first draft is like a newborn. With a newborn, all you want is 10 fingers and 10 toes. You don’t expect it to come out of the womb and play Mozart right away. You just want it to be. And then you can give it piano lessons over time, and then it can play Mozart as a 10-year-old or whatever. FELDMAN: Do people also have to get over being perfect in even talking about the ideas that will later be crafted into a story? LEVIN: Yes. There are very few people who can actually speak in perfectly organized paragraphs. And those people are annoying. Nobody likes them anyway. The serious point here is that a chapter is not a transcript of a call with some light editing. It’s got to be organized properly. There’s got to be a beginning, middle and an end. There have to be stories told in appropriate places. Get somebody good. It’s typically not the highest and best use of an insurance professional’s time to write his or her own book. Your time is way too short and way too valuable, and if you’re going to spend the eight hours it takes to translate an hour of interview into a chapter, well, that’s eight hours that you could’ve

People don’t even want books. They want leadership packaged in the form of a book. November 2013 » InsuranceNewsNet Magazine




been using to sell. The whole point of this process is to make your selling life easier, instead of giving you less time to do the thing that makes you money. FELDMAN: How long should the book be? You talk about having eight chapters. LEVIN: I had a kind of revelatory moment a couple of years ago. I’m a big admirer of Dan Sullivan. He has a program called Strategic Coach, and it coaches a lot of financial professionals, people in insurance, all kinds of entrepreneurs. I heard that he had a new book out and I’m all excited, and it turns out it’s a download for the Kindle. And I go to buy it, and it’s 48 pages. And I kind of blinked a few times, and thought, “How can anybody say a book is 48 pages long?” I read it and I realized that he only needed 48 pages in which to make all the points that he needed to make. Then it hit me: we’re living in an era where people’s attention spans have been shredded by technology, by texting, by tweeting, by social media, by surfing the Internet. In the past six or seven years, since smartphones became predominant, nobody even wants to talk on the phone anymore. The rules have changed. It used to be the biggest book wins. Whoever has the most footnotes, the biggest index, the longest “for further reading” section wins. Now, 50 to 100 pages are the book lengths that we’re primarily doing for insurance and financial advisors. In today’s world, half the people are reading your book on devices, so the “book” is a thing that allows readers to check stocks, or see how the game is going and get scores, and check the weather for tomorrow – whatever. So the “book” is in itself competition and a distraction. People don’t even want books. They want leadership packaged in the form of a book. They want it delivered in any form, actually, but the book is delivery of leadership in an easy-tofollow, inexpensive form. They’re looking for someone to follow. To become that person, all you have to do is put up your hand and say, 16

“I’m the leader,” and then you’ll get your followers. FELDMAN: How much editing should someone do if they’re not an editor? LEVIN: It boils down to three words: fix what’s wrong. If there’s a fact wrong, if there’s a story that wasn’t caught precisely by the writer, fix that, but leave the grammar and the punctuation and all that stuff to the professionals. That’s not your job. If the client has to edit the writing from a quality-of-writing standpoint, then one of two things happened. Either the ghostwriter failed miserably, or the client is an over-controlling fuss-budget and needs to learn to let go. Remember that the people who are reading these books are not reading them to their kids as bedtime stories. They’re not reading them because it’s the latest and greatest John Grisham novel that’s just come out. They’re reading it because they want to buy insurance, and they’re going to forgive you for things. FELDMAN: Haven’t there been compliance issues with ghostwriting? LEVIN: Compliance departments love us, because we know what they like, and we know what they don’t like. We don’t have sections that we just sort of plop down and put people’s names on, which compliance people don’t like. We’re not creating your story. We’re listening to you and we’re telling your story in writing, the way you would if you had the time to do it. Maybe a little bit better, because we’re professional writers.

InsuranceNewsNet Magazine » November 2013

Our experience is that insurance advisors, or anyone who has any sort of responsibility to their clients in a financial sense, are all different with different life experiences and have different reasons for having gone into the profession. Everybody’s got different personal stories about things that they witnessed in their homes, or with relatives or friends of the family, that could have been so different if the right insurance had been in place. Everybody has seen different examples of the government getting millions and millions of dollars it really wasn’t entitled to because the family hadn’t planned properly. Everybody has different approaches to selling. FELDMAN: So this is good for compliance and for sales, because you have this consistent story about you? LEVIN: Yes. For prospects also, because from their perspective, they don’t have to tell their story over and over again. They can be comfortable with you after reading your book because they know you get them. Insurance professionals typically look at things from their own perspective and they don’t often see that it’s no fun to be on the other side of the table either. Prospects are interviewing five insurance professionals when they’ve got 10 other things to do. Their kid has to go to Little League, they’ve got work to do and they’ve got 600 emails to deal with. Well, they don’t want to have to do that. So when you create that intimacy through a book, they can say, “Ah, I can relax now. I found the right person.”

FREE BONUS REPORT! How Any Advisor Can EASILY Write Their Own Book - With New York Times Best-Selling Author Michael Levin Get your FREE copy of this INN Exclusive Report at or see PAGE 63 for more details.



November May 2013 » InsuranceNewsNet Magazine



Advisors Bullish About Remainder of 2013

Yet Another Record Quarter for Indexed Annuity Sales It’s getting so that, if indexed annuity sales slip, UP MORE THAN that will be huge news. That’s because the industry keeps racking up new record sales results. The latest example: Indexed annuity production in second quarter was up more than 17 percent compared to first quarter, and up by more than 5.5 percent compared with the same period last year, 2Q 2013 according to industrywide sales results reported by Wink. The results beat the previous third quarter 2010 record by nearly 5 percent, said Sheryl J. Moore, president and chief executive officer of Moore Market Intelligence and Wink. “Even year-to-date sales increased 1.5 percent over this same period, last year,” she said. The industry’s sales leader for the quarter was Allianz Life, with nearly a 14 percent market share. Security Benefit Life and American Equity came in second and third, followed by Great American and EquiTrust.



Whew! If agents and advisors ever doubted that business owners need their services in this slow-recovery world, a new U.S. Trust survey should clear that up pronto. The study of 200 U.S. high net worth business owners found that the owners are often the wealthiest in their families and so tend to take on responsibility for the well-being of extended family members. But 57 percent of the owners do not have a financial plan that accounts for financial support needed by other adult family members.

This is even though 44 percent expect to financially support their parents or in-laws at some point (compared to 31 percent of non-owners) and 35 percent have forfeited income or career advancement in order to care for the special needs of children or parents (as compared to 21 percent of non-owners). What’s more, the researchers found DID YOU




that many business owners pay greater attention to the business and put off important actions that can affect their overall wealth and financial security. This includes business succession planning, financial planning, estate planning, investment decision-making and wealth structuring. Somebody do something about that, OK?


OK, sales of income annuities don’t top the annuity charts. But there is no mistaking that the products are on the grow. For example, second quarter figures from Beacon Research show that income annuity sales grew by 16.9 percent over first quarter to $2.6 billion. (They were helped along by galloping sales of the emerging product line of deferred income annuities, which, according to Beacon, rose by almost 40 percent from first quarter.) Income annuity sales also were up on a year-over-year basis, rising by nearly 12 percent in second quarter over the same year-earlier period, Beacon said.

THE MEDIAN ADJUSTED GROSS INCOME FOR HOUSEHOLDS without defined contribution retirement plans or individual retirement accounts was $32,000, compared to $75,000 for those that did have them. Source: The Government Accountability Office

InsuranceNewsNet Magazine » November 2013

There also has been more quoting activity on income annuities, specifically on the single premium income annuities listed on the Cannex SPIA Exchange. In the third quarter just ended, the ex-

change recorded 162,892 quotes for SPIAs through its online quoting service. That’s up by about 31 percent from

124,362 in second quarter and up by nearly 34 percent from 121,652 in third quarter last year. Those aren’t sales, but the numbers suggest that advisors are increasingly researching information about SPIA products for clients. These uppers are despite the low interest rate environment. Makes a person wonder what the market might be like in a rising interest environment.


The millennial generation, also called Generation Y or echo boomers, is at “significant risk” of not being able to achieve retirement security, cautioned Financial Finesse. In a 2013 survey by the El Segundo, Calif. firm, only 17 percent of millennial employees said they are confident they are on track to retire with 80 percent of their income (or their goal) in retirement. That’s a concern because, according to the researchers, “this generation is likely to face far more economic challenges than older generations, with relatively lower Social Security payouts, higher health care costs and longer life expectancies.” Do you think all the tech tools that retirement firms are offering will help this generation get with the retirement program? Perhaps, if these 20- to 30-somethings actually used the tools. But guess what? Only 29 percent said

they have used a retirement calculator,

down from 32 percent one year ago. They seem to be out of touch on insurance, too. For instance, more than half of Gen Y workers surveyed by Hartford Financial vastly overestimate the average cost of disability insurance purchased at work, and only one in three completely understand life insurance, the carrier said. But Hartford spokesperson and Gen Y author Lindsey Pollak sees an upside in this. “There’s a tremendous opportunity

[NEWSWIRES] to help this country’s 72.2 million millennials understand the importance of investing today for their tomorrow,” she said.


So-called defined contribution health plans are starting to surface at a number of small businesses and nonprofits. Their acronym – DCHP – already is gaining industry recognition. By whatever name, businesses are setting up the plans as a way to gain more control over health benefit costs while also giving employees more choice. What are DCHPs? First, said Zane Benefits, they are not traditional group health insurance. Rather, they allow businesses to give each employee a fixed amount per month for health expenses. The em-

ployee then can use the monthly sum to pay for the individual health insurance plan of their choosing (or other medical expenses). The employer decides the monthly amount, eligibility requirements and other plan details. So move over, defined contribution retirement savings plans. It’s time to make room for the DCHPs.

QUOTABLE We know that millennials invest a lot of time and money into their health, image and personal interests. Focusing on financial fitness makes all these priorities possible. — Bill Taylor, vice president-financial planning, Northwestern Mutual


Three fourths (78 percent) of financial advisors said they most often recommend a diversified portfolio of mutual funds to help clients achieve their retirement income goals. That’s according to a survey by Seattle-based Russell Investments. Only mutual funds? Well, not just mutu-

Two Carriers Offer Life/Long-Term Care Combos There aren’t many life/long-term care insurance combo policies on the market so when they debut, we blink. This time we had to blink twice, because two big northeastern carriers have each rolled out a long-term care acceleration feature for their whole life policies. One of the carriers is MetLife; it’s now offering an enhanced care benefit rider that accelerates up to 90 percent of the whole life death benefit to help pay for ongoing care if an insured develops a prolonged illness. The other carrier is the Guardian; it is offering the Guardian LTC Rider as a whole life option that accelerates a portion of the death benefit – chosen by the policyowner – if the insured is chronically ill and receiving qualified long-term care services. There is an extra cost for the Guardian rider. In MetLife’s case, the rider is included on all MetLife Promise Whole Life policies for no additional premium, but there is a processing fee of $150 and the amount of money accessed will be discounted by a certain percentage. al funds. It turns out that 49 percent also named variable annuities; 48 percent, dividend-paying stocks, and 32 percent, fixed income securities. So annuities are definitely on the planning menu. What is surprising is that the least popular options were also annuities – in particular fixed annuities (16 percent) and immediate annuities (19 percent). By the way, mutual funds designed to produce retirement income were also in the least popular group at 19 percent. The latter findings seem to be at odds with the flood of research about how Americans want guarantees and secure income sources for their retirement years. The findings could reflect advisor concern about the low interest rate environment, maybe some baseline bias against fixed annuities, perhaps lack of advisor awareness about where the fixed annuities fit, and/or some queasiness about the direction of the fixed annuity business overall. Whatever the reason, fixed annuity distributors might want to look into this. DID YOU




Insurance agents who have senior clients are quite aware that seniors tend to have more health issues than younger adults. But what health problems should the agent be looking for? According to Clear Vision Information Systems, two thirds of Medicare beneficiaries have two or more chronic conditions, and three out of every four

dollars spent on health care is the result of these ailments. Clear Vision should

know; it provides Medicare Advantage risk adjustment services to health plan providers. What are the five most common chronic conditions in this population? High blood pressure, high cholesterol, heart disease, arthritis and diabetes, the firm said. Insurance agents who sell underwritten policies might want to keep that list in mind. Worth noting: cancer is not on that list.

ONLY 10 PERCENT OF COMPANIES offer consumer-directed health plans today, but 44 percent are considering offering the plans in the next three to five years. Source: Aon Hewitt

November 2013 » InsuranceNewsNet Magazine


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ut abo e r u uns mobile hile e r w e sa isor rporat ractice they v d ya ir p ow it. inco Man ow to nto the nder h ithout i h o w logy isors w siness o n elli r o techher adv r do bu .M ot ve A e n d l cou teve

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For advisors who have adopted it, mobile technology is helping them use their selling time more efficiently. But others are bewildered about the choices available and the quick obsolescence of various platforms. Meanwhile, carriers and regulators have a lot of catching up to do.


ANIEL J. WENDOL wasn’t always a sales wizard waving a magic stylus. Before he was able to conjure up illustrations, policy quotes and appointments with the tap of his device, he was a mere mortal calling up his secretary to straighten out his jumbled calendar and telephoning his telemarketer to get the latest leads. He had to leave a sales process to get more information for clients, especially after hours. Now, as his colleagues flip their phones and scribble into their Day-Timers, Wendol is on the road tethered by nothing but his Samsung Galaxy Note II to connect him with everything he needs. He’s not a wired tech geek with gadgets spilling out of his pockets. He has just his Note, which is bigger than a typical phone but too small to be a tablet. It’s in a class of phones with screens exceeding 5 inches, but smaller than 7 inches, that have been dubbed phablets.

Daniel Wendol says he can be autonomous on the road and a more effective producer because of the easy access to his calendar, sales tools and data on his phone. Phablets are the latest electronic devices easing the leap into mobile technology. People putting down their regular old cell phones to look for something smarter that they can use for business might be torn between a phone and a tablet. Now, they don’t have to choose. Wendol knew he wanted the bigger screen, but he didn’t envision all the value he would get out of his Note.


“It wasn’t until I got it that I realized what I can do with it,” said Wendol, who is an independent insurance producer in Florida. “I still have people laughing at me when I put this big phone up to my head to make a call. But when people see what I am doing with it, they say, ‘OK, I get it.’ ” What they get is Wendol is getting business. But some advisors who responded to an online survey from InsuranceNewsNet said they were resisting mobile technology because they wanted more selling time. “It keeps the competition busy while I’m selling to clients,” said one. “I find that nothing beats face to face,” said another. Wendol agreed with that second point, but he said it is all the more reason to leverage mobile technology. “I can’t do my face to face as effectively without technology,” Wendol said. “For instance, I do Social Security timing, that’s the hot thing. But I don’t have time to do every Social Security report, so I just upload the data and someone else does it for me. Just like there’s no way I have time to cold-call people, so I have a telemarketer do that and send me the information. I can’t keep track of every insurance company’s changing rates. I have to have online software to help me out with that. So all these things are designed so that I can spend more time in front of clients.” It makes sense that only a few of those who responded to a poll asking about their use of mobile technology would say they actually do not use it. But those non-users make up a large percentage of the insurance producer population in general. A LIMRA survey taken in March found that 38 percent of retail insurance and financial professionals don’t use a smartphone for business. These were professionals selling “retail” products to individuals, rather than group products. The number of retail professionals not using tablets for business was even higher: 79 percent. This is at a time when more than half of all Americans, 56 percent, have a smartphone, and a third of all Americans have a tablet, according to a Pew Research poll taken in April. Prospects and clients clearly have adopted tablets at a far higher rate, with 56 percent of households

November 2013 » InsuranceNewsNet Magazine



LIMRA 2013 Mobile Tech Survey

earning at least $75,000 annually and 49 percent of college graduates owning a tablet. So, why the lag for insurance professionals? The answer is as old as the chicken and the egg conundrum. Insurance and financial professionals are looking to companies for direction on what to use, while companies are holding off making a substantial investment until producers adopt and decide on a mobile technology. “Technology is changing so rapidly that it’s hard for companies to know where to allocate their human and financial resources,” said LIMRA researcher Mary Art. “And then you are dealing with all the different devices. A lot of financial professionals have iPhones and Android phones but those keep changing. So companies start working on the iPhone 4 and then all of a sudden we have an iPhone 4S and an iPhone 5 and then an iPhone 5S. So I think that’s been a real challenge to keep up with the various devices and operating systems and platforms.” But the wait might be paying off for companies, because insurers are learning that if they recraft their websites to be mobile-friendly, they are starting to answer the question of which operating system producers should pick, Art said. “Responsive web design is becoming very popular among companies because they can see that even though it takes a while to build them, it makes it much easier to adapt to all the new tablets and iPhones and whatever that come onto their site,” Art said. So, Android, iPhone or Windows? Whatever you prefer. Websites and apps are becoming more agnostic about operating systems. That would seem to be a sensible route for insurers because producers are split on what system they use. In the LIMRA survey of retail professionals, 23 percent had an iPhone and 24 percent had an Android. That is about the average among American cell owners, with 28 percent owning an Android and 25 percent having an iPhone, according to Pew. The surprise in the LIMRA group was that 14 percent own a Blackberry vs. 4 percent of Americans overall, according to Pew. Although more companies are offering options such as apps for producers, the

Percent of Financial Professionals Using Smartphones for Their Business



Don’t use at all








Percent of Financial Professionals Using Tablets for Their Business Don’t use at all








Company Website Impact


84% 57%

I am more willing to place business with a company that offers a useful website

InsuranceNewsNet Magazine » November 2013

My company’s website helps me increase sales.

My company’s website helps me provide better service to existing clients.

Use and Interest in Online Applications

Use and Interest in E-Signatures





13% 17% 55%

Do not want

Do not have but want


Have now; do not use

Have now and use

Source: LIMRA Technology Leaders: Financial Professionals Who Excel With Technology

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percentage of companies who offer them is still not enormous. A LIMRA survey last year showed that 30 percent of companies have a mobile initiative for producers with another 30 percent planning to introduce something in the following 12 months. A study by Celent found very few of the top 100 life insurance companies have apps for their producers. Earlier this year, they found 27 percent of the companies had a mobile app for their producers. Although that is more than double the 12 percent they found two years earlier, it is still only about a quarter of companies that offer mobile apps for their producers. Celent researcher Karen Monks said the pace of growth was good but it was still a low number of companies offering apps. “Seventy-three percent haven’t done anything yet,” Monks said. “In today’s world, everybody has some type of a mobile phone or a smart phone, and you’re going to want to access something related to your work.”

Carriers have to be careful because although companies can demand that their captive agents adopt practices such as online applications, independent agents can walk if they don’t like the talk from a company or distributor. “For the most part with the captives, it was usually the insurance company pushing to them versus producers asking for it,” Monks said, adding that captives and independents are now asking for more. “It makes sense that there would be more demand because they were given eApps first. Now they want the illustrations. They already had their marketing materials on the iPad and now the eApps, but not illustrations. So, producers said, ‘Well, give us the whole book.’ John Hancock did that. Everything’s on their iPad now in what they call a briefcase.” Insurance companies have been slow to adopt these kinds of processes in the United States, but some American insurers already have experience in mobile and online efficiency from their overseas operations in Europe and Asia. “With MetLife Asia in Hong Kong,”



InsuranceNewsNet Magazine » November 2013

Monks said, “when you apply for insurance, it’s a whole application on an iPad. It has the illustrations, flows into the application and when it gets to medical information, the agent takes a picture of their medical records, attaches it to an email and sends it in along with the eApp.” Monks said that process would face considerable hurdles in the U.S., with security concerns in particular. But companies are getting comfortable with practices such as eSignatures. “It took a very long time for eSignatures to be looked at as a viable law,” Monks said. “It’s taken life insurers forever to finally say if we get sued we will be protected. What we’re hearing from insurance companies is that the insurance departments in most of the states themselves aren’t automated. So they have paper apps and wet signatures. New technologies are moving much faster than insurance departments can actually handle. And you can’t put out a new application without department approval.”

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Among Top 100 Insurers, 27 Offer Mobile Apps to Agents and Producers

Top 100 Life Insurance Companies with NO Producer Focused Apps 73%

Marketing Apps

Top 100 Life Insurance Companies with Producer Focused Apps 27%

Informational Apps Transactional Apps

Source: Celent - Mobile Technology for the Life Insurance Producer

Going Boldly

Successful producers are not waiting for companies and the government to tell them what they can and cannot do. They are taking what they have and pushing forward.

Wendol said he is using his Note for Google spreadsheets, taking pictures of documents and uploading them along with many other processes. Even though at 37, he is a relatively young producer, it took a while for him to adopt mo-


bile technology. But finally, it became a no-brainer to accept. “I used a Google calendar for personal use but it was not connected to the CRM at work and so in order for my secretary or telemarketing team to see what I was up to they had to call me,” Wendol said. “So I had to write out my calendar every week. It made no sense. So I said there’s no way I’m going to deal with the constant calls. There has to be a better way.” The better way came from his field marketing organization (FMO). “They had a proprietary framework that they offered for free so I committed to do it,” he said. “It has storage where I upload documents, like my fact-finders, and the CFP and others review them to help me come up with a proposal. It also had a calendar function in there that was web-based so I said, ‘Why not?’ ” That “why not?” allowed Wendol to make the leap of discovery. Now he is more effective and ready for business. He changed his target demographic from retirees who are 65 and up to those who are just approaching retirement. So, he is

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doing more evening meetings with clients who are still working. But insurance companies are not working during those hours, so his usual calling up the company for information wouldn’t work in front of clients. And the last thing he wanted to do was leave the sales process half-done. “I found a program that allows me to quote the major carriers on products, including guaranteed universal life, which is a big part of my tool kit,” Wendol said. “I use indexed annuities a lot, so income riders are often useful. So, I have an income rider tool where I can run a quick scenario. I can talk to them in that meeting and say, ‘Well, if you wanted $35,000 a year in income in three years, here’s how much you will need to put in now.’ ” His phablet also allows him to keep track of things for himself, such as getting paid on cases. But what he doesn’t do is share his Galaxy Note with clients. The screen is not big enough for that. This is becoming more important as his clients sign up for Medicare, requiring an online application. So, Wendol is looking at what tablet he might get and how to incorporate it into his practice. Many companies are introducing apps for producers to share with clients on tablets. Benefits are a key area where tablets are particularly useful. Art of LIMRA said she knew of a producer who used iPads very effectively to review benefits with high-end business clients. Instead of passing around a half-dozen binders to prospects and clients, he hands them iPads. “So, he can control the presentation,” Art said. “It was one presentation communicated out to the tablets. So, they’re not flipping through their binders while he’s talking. They were on the same page of the presentation as he went through it because he controlled it.”


Not only does a producer get to control the process in a tablet presentation but also, at this point, it looks much more impressive to come into a meeting handing out tablets rather than paper. Older producers might not be so quick to pick up tablets, but they should keep in mind what kind of image they are projecting to younger prospects, said Monks, the Celent researcher. 28

InsuranceNewsNet Mobile Tech Survey


Source: InsuranceNewsNet Mobile Technology Survey, September–October 2013

“You are probably not selling to as many 70-year-olds,” Monks said. “You might be selling to 30- to 40-year-olds, and if they look at you filling out a paper process, they’ll say, ‘Ooh, it’s going to take me a long time to get this, isn’t it?’ ” The better scenario is clicking a button and submitting the data. “Then here comes an email telling you it’s submitted and you’re going to hear back from this company. I’ve already set up those appointments for blood work and it’s all done for you. They’re going to look at it like ‘this guy’s on top of my policy’ versus

InsuranceNewsNet Magazine » November 2013

sending a paper into the void.” Tablets are also part of a changing perspective between producer and client. “It’s side-by-side instead of across the table,” Monks said. More tablet programs help build those relationships, such as Ready-2-Retire, which LIMRA helped to develop. It allows clients to click through a questionnaire to help them understand what they want out of retirement. Not only does it engage the client, it helps the buyer and seller work together toward the goal. So, if these tools are available, why are


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only 21 percent of insurance and financial professionals using tablets for business? A big part is knowing when to take the leap. Millennials and those who are younger might have grown up with technology, but boomers and those who are older remember the costly evolution of electronics. That’s what has Hal Hughes on the fence about what to buy. The Oregon insurance producer has a Nokia Windows phone and he admits he is not the most technologically sophisticated guy, even though he knows he has to get with it as he reinvigorates his business.

InsuranceNewsNet Reader Responses What app or program do you find most useful in your practice? “The old Palm Pilot. I have not found a device that can hold all the data I keep in the Palm Pilot. If I could, and it was a reasonable size, and I could sync it with my computer, I would switch.” “I really don’t use the ‘Smart’ functions. If I did my broker/dealer would want control of my device. I refuse to permit that.” “Twitter app” “Yelp and MapQuest.” “Carrier illustrations and case designs from my IMO via emails.”

“Excel + Papervision + email” “My web-based CRM app (calendar and prospect database), app that quotes life insurance, online document access, and a Picture to PDF app.” “Citrix to access desktop workstation” “Web browsers, most all of what I do is Internet based.” “Since 1984, I have used Alpha Corporation’s Rational Database with forms I developed myself to track all client and office activity.”

Briefly describe a way in which your favorite tech device, app or program helps you in your practice.

Hal Hughes says his phone has helped him keep organized and is looking to make a bigger leap into mobile technology. But, as a 67-year-old, he remembers and mourns the many dollars spent on soon-to-be obsolescent technology. “How many 8-tracks do you have now?” Hughes asked. “I am reluctant to grab onto something that may be wonderful now and may not even be here in 18 months. I’d hate to spend thousands of dollars and find, well, close but no cigar.” Like Wendol and many other colleagues in the business, the ability to access his calendar on the road was what introduced him to the value of mobile technology professionally. But now he has fully embraced it and is ready for a broader jump. “I went kicking and screaming into the 20th century to find out that we’re in the 21st,” Hughes joked. He ran smack into the limitations of his phone when he got PDFs. “It’s great I get my email on my cell 30

“ACT! keeps track of prospects, clients, suppliers, etc. as well as my personal schedule. Being 62 years old and having attention deficit hyperactivity disorder, the alarms are great in keeping me on track.” “I may add a tablet to my arsenal in the near future, with its increased ability to download more data quickly.” “I can keep track of the market, read news, read research reports and make trades.” “I’m not a sophisticated tech user. I’m using my Windows phone more on a broader range than simply phone calls.” “My staff and my clients can reach me 24/7 on my cell phone, and they do!” “Can dictate note into phone via Google Voice and the note shows up on my PC or however many devices you have app installed on. Use it for reminders, meeting notes, to do’s, etc.” “I can keep to do lists and notes on Evernote and access them from my office/home/phone when needed.”

InsuranceNewsNet Magazine » November 2013

“I use my smartphone more as a PDA - calendar, contacts and email functions. No other special apps.” “In the two years I’ve used Google Maps as my iPhone GPS, I’ve yet to get lost going to a client’s house or business event. Huge blessing from the days of maps.” “I’ve considered myself as technology savvy so I’m very good at adopting new apps or tech devices. I use iPad to show illustrations, iPhone to run the term quote, Dropbox to save the life applications to share or submit the case to carriers. I gain knowledge from Marketwatch and Investopedia. Finding a meeting place through Yelp or Nearme...not to mention to the calendar to organize my daily activities and contact to my leads...I’m enjoying using apps....” “We can write apps on the iPad, download them directly to the companies’ websites. It makes processing business faster and without errors.” “We are very dependent on digital programs. Almost all of our marketing is digital. All our contact is through the internet except for telephone contact.” Source: InsuranceNewsNet Mobile Technology Survey, September–October 2013



UNIVERSITY OF PHOENIX STADIUM At Financial Independence Group, we believe in acting as a team and that effort can only be accomplished through sharing of valuable ideas. Every year, we bring together the year’s top producers coupled with exceptional keynote speakers for our FIG Sales Symposium. The 2014 FIG Sales Symposium will be held in Glendale, AZ. Surrounded by sweeping vistas and traditional charm, Glendale is Arizona’s West Valley and home to Super Bowl 2015! Advisors will attend educational sessions to learn the latest trends and strategies in the industry. And, last but not least, advisors will have the opportunity to network with fellow advisors. This is an event you don’t want to miss!



W W W . F I G S Y M P O S I U MNovember . C O 2013 M

» InsuranceNewsNet Magazine




phone,” Hughes said. “But I got a quote for disability coverage and I went to pull it up and saw that it was going to take four and a half days to download this. So I went back to my own computer and pulled it up in two seconds and saw, ‘Oh yeah, it’ll be $1,600 extra a year to cover that.’ If I were with a client during that, it would have been an egg-on-my-face moment.” He realized he needed a tablet. He wants something simple to use but he has what might be an extreme disadvantage because of iPad’s domination of the segment. “All my life I’ve had an aversion to Apple products as strong as the affinity some people have for them because what I’ve seen was that so much of the business community is PC-driven,” Hughes said. “It has not been compatible with PC applications, which illustrations have been in, so I was reluctant.” But the researchers and others are saying that applications are not based on operating systems as much as they once were. Producers are unlikely to be limited in apps if they are choosing between an iPad and Android products. In fact, if anything, iPads would have the lead in apps written for it. IPads also offer a couple of sizes. The full size version with its 9.7-inch diagonal screen is still more portable and handy than a larger, heavier and bulkier laptops. And the 7.9-inch mini is an even easier carry but might be too small for presentations and documents. Compliance departments might also prefer the iPad because they do not have a USB port and are a little more secure as a result. But if you live and die by loading up from a thumb drive, this is a point to consider. Another consideration is the cycle of development. As we go to press, Apple has unveiled a new lighter-weight iPad, dubbed the iPad Air, and two iPad Mini models, one of which has a high-resolution Retina display. If you wanted a comparative bargain, now is a good time to buy an older model now that the iPad Air and new Mini were introduced and early adopters toss their formerly beloved devices for the latest and greatest. Even used, they still will not be cheap. Apple products are on the luxury side of the spectrum, something else that bugs Hughes. 32

Size Comparison of Smartphones and Tablets


iPhone 5s

Galaxy Note 2


Google Nexus 7

“If they jack up the prices because they think they’re so good, well, guess what, my dollars are walking,” Hughes said, adding that he might have to swallow his pride and get an iPad if that’s the right choice. How will he make the right choice? First, he’ll be looking for some direction from his main carriers. His main company is Principal, and Hughes said the carrier is just getting to eApps. In fact, he has had a heck of a time just doing some rudimentary things on social media because of compliance. It’s only recently that his carriers lifted the gate on LinkedIn, which some say is indispensable to business these days. The other is seeking advice from younger producers in the business. “It’s native to young people,” he said. “They were born into it. We’re from a foreign country.” He looks at it as a fair trade. They can teach him technology and he can show them the ropes. “Some of the most successful people in this business are those who have a mentor,” Hughes said. “If we can help them be a survivor in this industry, maybe they can help us be survivors in the electronic world.” He knows many of his colleagues closer to his age are still resisting change, figuring they’ve been successful so far. But Hughes said he knows obsolescence is just as true for people as it is for technology. “Anybody who says I don’t want to change, I’ve learned it all, well, go back to buggy whips,” Hughes advised. “There were people who were totally functional

InsuranceNewsNet Magazine » November 2013

iPad mini


when we needed buggy whips. And we really don’t need many of those anymore.” Monks of Celent said she understands that older advisors might think they are not missing out on much by sitting out the rush to technology. But time is running out. “My first question would be, how long do you want to stay in this job? Because if someone was planning on retiring very soon, then I would say just continue on your way,” Monks said. But, she added, if retirement time is more than two years from now, there is a bandwagon that you need to hop on. Paper applications will not be available and prospects, even older clients, will expect to do things electronically. Experts and tech users alike say, “Just say yes.” Go find what is comfortable and the tech will catch up. That’s what Hughes is learning. “I may be a Johnny-come-lately but it’s not like I’m not changing at all,” Hughes said. “I’m at the point, ‘OK, I’m here. Now, what do I do?’ But I realize we’re all in this electronic stew together. And we’ll all figure this out together.” Steven A. Morelli is editor-in-chief for InsuranceNewsNet. He has more than 25 years of experience as a reporter and editor for newspapers, magazines and insurance periodicals. He was also vice president of communications for an insurance agents’ association. Steve can be reached at smorelli@


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Technology Issue • Special Sponsored Section


InsuranceNewsNet Magazine Âť November 2013

Technology Issue • Special Sponsored Section

November 2013 Âť InsuranceNewsNet Magazine


Technology Issue • Special Sponsored Section

I-Genius Defines the Evolution of Agent-Friendly Tech Tools Q&A with Insurance Tech Frontrunner BILL LEVINSON


eliver policies in days instead of weeks; reach more prospects and put your marketing on autopilot; establish a presence on the Internet and capture leads in your sleep. An easy-to-use technology that does all this and more is finally here. It’s called I-Genius. And it’s free. In this Q & A, Bill Levinson discusses I-Genius, a complete platform of cutting edge tools available from Levinson & Associates, and he offers his insight on how technology in our industry will evolve from here. Q: How did I-Genius get started? A: A few years ago, I came to the conclusion that there was much technology used in the health and P&C world that was not present in the life industry. So it was up to the agent to spend thousands of dollars and countless hours creating a website or a CRM tool. But most agents would rather spend their money on leads so that simply wasn’t going to work. The challenge for me was how to manage this huge expense, not charge the agent and not reduce his commission. Most IMOs today don’t offer platforms like this unless they charge the agent for it or require a huge premium commitment hardly attainable by most agents. The answer for us was taking many of our override dollars and building I-Genius. We did exactly that and I am proud to say we offer all active Levinson agents I-Genius at no charge even if the agent has never written a piece of business. Q: Tell me about your CRM.

A: I-Genius is like nothing you can simply buy off the shelf. It’s not even a basic CRM that we set up for insurance. It’s built for life insurance agents only, but will also help our agents with all lines of insurance including health, P&C and even securities. There’s also an administrative side that acts as a complete back office with everything updated in real time. For an agent working out of their home with no secretarial assistance, this is 36

InsuranceNewsNet Magazine » November 2013

When Bill Levinson partnered with his father 15 years ago, he brought with him his education and expertise in technology, which, combined with his father’s extensive brokerage experience, brought their practice to the forefront of technological innovation in the insurance industry.

a true life saver. And it’s great for a General Agent because he or she can go in and see their entire downline’s business, every lead they receive and every note to be posted. The other side is the most important, the marketing side. We have available for our agents over 400 pre-approved letters, campaigns, newsletter chassis, birthday cards and conversion letters. Simply go in, upload your photo and signature and then just click a button. You can do mail merge, labels and almost everything else related to marketing. Plus there’s a lead management system which is part of the CRM tool. We have our own exclusive lead program so our agents can purchase leads from the dashboard. Our agents have tracked and processed 9,240 leads through I-Genius since Jan. 1 2013. Q: CRMs sometimes sound like a lot of work. Is this easy to use? A: Very easy to use. We have a 10-minute video that goes over everything. We also have a person who’s available from 9:00 to 5:00 EST Monday to Friday. His sole purpose is to be available and help our agents every step of the way. And we’ll train and work with your staff too if you wish. Q: People see transferring all their data into a new CRM system as a huge obstacle. Is there anything that your system does that can quickly import data? A: If we can get all of your data on an Excel spreadsheet, we will do all of your data entry for you at no charge. And we can help with how to set up that spreadsheet. Plus your data is 100 percent secure. No one can see it and it is transferable should you decide to leave. Q: What are some of the other tools? A: We have a smartphone quoting tool, e-policy delivery and

Technology Issue • Special Sponsored Section

e-applications that are integrated with our CRM platform. The customer opt out rate is less than one percent when asked if they would like their policy delivered electronically. We have annuity e-apps from the platform, as well, not just life. Everything is stored and updated right through the dashboard and you never even print a piece of paper. There’s no filing or going to other tools. We have an online library of training videos, such as how to set up your own e-mail campaign, mail merge, etc. Another feature we offer our agents are 3 different websites to utilize. Firstly, there’s where our agents can run quotes and get so much additional information. Secondly, is designed exclusively for all information regarding our “dollar-for-dollar” Levinson scholarship campaign. Thirdly, allows Levinson agents to set up their very own, complimentary website with quote en-

“Without a doubt Levinson & Associates have the most innovative tools for agents available today. From the CRM to the latest iPhone, iPad and Android quoting tools and applications.”

– Duaine O. gines etc. And amazingly, once it’s up and running, any information that a prospect or client enters gets instantly populated into your own CRM tool and simultaneously notifies you via email. Additionally, we offer our agents an automated underwriter called X-RAE. We offer the full version of X-RAE 100 percent complimentary to all Levinson agents. Then for more extensive impaired risks, our agents can input as much health information as they can get from their prospects. That data will be transferred to every underwriting department of every carrier we represent. Typically, we will have an offer in writing from every interested company within 24 hours.

agents love that we can cut an application process that normally takes 24 to 27 days down to an average of six days. They’re saying, “I wish I would have started this years ago.” And they can’t get this anywhere else. Q: Why not? A: We have helped secure a patented process that quite frankly no one else has. Levinson & Associates became a major investor and believer in technology very early in the game. I envisioned this technology coming before a lot of our competitors did and I think we got a huge head start. The first carrier to introduce an e-policy delivery that’s on a multi carrier platform chose us as their pilot agency in 2012. They did so because they knew our adoption rate and they knew that we already had a solid history of developing and implementing tech-based tools and apps. Q: Clearly you’ve had a lot of foresight regarding technology’s progression in our industry. Where do you see it going from here? A: It’s slowly becoming more and more common to hear about e-applications, e-policy delivery and quoting apps in our industry. Where I see it going in 10 years is literally going into one application, from your smartphone or desktop, and being able to do everything from A-Z right from your device of choice. An insurance agent will never have to see his prospect or client again unless he chooses to. This is the way all other industries are shifting and this is where I see the future going for us. With that said, the most advanced technology will never replace a meaningful interview between an insurance agent and his or her prospect. Whether that interview is at the kitchen table or on your iphone, no technology will ever replace that.

Q: How many of your agents use this?

See how other agencies are

A: At the moment, about 940 agents are active on our CRM tool. In the beginning, we watched the numbers slowly grow from 20 to 25 and then to 35. In the beginning, however, it was mostly our younger agents participating. Now many middle-aged to more mature agents in their 60s and 70s are on board also. Even they realize they must keep their name in front of their prospects and clients. Or someone else will be more than happy to. Our CRM tool is the perfect way to accomplish this.

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November 2013 » InsuranceNewsNet Magazine


Technology Issue • Special Sponsored Section

ANNUITY SOFTWARE HAS CLIENTS JUMPING OUT OF THEIR SEATS And Producers Consistently Closing $400,000 tickets!


ou know I don’t like talking about it,” Candice McLain said. After twentyeight years of marriage, she didn’t have to say anything at all. Matthew knew that his wife didn’t want to think about him potentially passing away in his sixties. Neither one of them did, but it couldn’t be ignored. Matthew insisted that she be present for this second meeting, to help him calm his other great fear: that, should something happen to him, his lifelong love wouldn’t be cared for. That she’d have to move out of the family home and be a burden to their children. He simply squeezed his wife’s hand as they sat side by side in the waiting room. They didn’t wait long. Todd sprang into the room to greet them, kindly welcoming Candice first and inviting them both into his office. Last week, Matthew laid everything out. His pension, his 401(k), his wife’s IRAs, everything. And then Todd set up their second appointment and asked him to bring his wife. This week, after just a couple minutes of friendly chit chat, Todd had his laptop fired up and projecting its image onto a sixty-inch screen they all could view together. What they were looking at was basic. It was a screen with simple numbers, Matthew’s and Candice’s names. “All I did, Matthew, was input all the information you gave me last week,” Todd said. In fact, it had only taken Todd about 38

fifteen minutes to do it. “And so this is what your future looks like.” He clicked on the fourth of four tabs, the one that reads, “Income for Life Report.” In that instant, the McLains could see what income they’d receive for each year for the rest of their lives. It was suitable, what they had been expecting. So then it was time to bring up the elephant in the room. Matthew said, “What if I die at age 66?” It was the age his father passed away. Three clicks later, and the answer to Matthew’s question appeared before them on the big screen. “Oh no,” Candice quietly said. Matthew could say nothing. The projection was devastating. “It doesn’t have to be this way,” Todd said. “I do have a solution.” Todd didn’t launch into a sales pitch. He didn’t start into the nuances of a particular plan. He didn’t even mention a product. All he did was take a few moments to input onto the screen the details of a particular annuity that he was confident would fit his new prospects. And then another two clicks, but keeping the projection as if Matthew passed at age 66, and the numbers were dramatically different. Matthew leapt out of his chair and dashed to the screen. His index finger landed on the line showing their income the year of his hypothetical death – income that did not decline at all. “That!” He affirmed. “I want that.” Todd had yet to even tell him what “that” was.

“Oh no,” Candice quietly said. Matthew could say nothing. The projection was devastating.

InsuranceNewsNet Magazine » November 2013

Technology Issue • Special Sponsored Section

This scenario has been playing out in agencies across the country. This software really has gotten clients leaping from their chairs proclaiming, “I want that!” It will speak to the basic financial concern of your clients. It’ll eliminate the need to sell. It will, for the first time in your career, put you on the same side of the table as your clients. And you really can write an application in 20 minutes. This tool was designed by Mike Steranka, an advisor who has done income planning for 15 years and has identified clients’ basic problem – running out of money – and an unbelievably simple way to show them the solution. There is no 30-page input. “Just one page, 7 or 8 inputs, and it’ll show a client their entire income story for the rest of their life,” Steranka explains.

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Co-founders Brian Gengler and Mike Steranka


Mike Steranka is co-founder of First Income Advisors, and a top advisor for Aviva USA multiple times over. Mike is a highly sought-after Retirement Specialist and coach and co-author of E-Myth Financial Advisor. As CEO of Retirement Planning Services, he produced over $300,000,000 in annuity production. His expertise and hallmark is distilling complicated information into clear and simple processes that replicate success both for your customers and you. Brian Gengler, Co-founder, First Income Advisors, has nearly 20 years as an innovative corporate marketing executive with a solid track record of creating and implementing record-breaking FMO systems. As Senior VP and Executive VP, Brian has led the creation and development of the owned distribution for both Allianz of North America and Aviva USA and has trained, coached and mentored thousands of advisors.

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November 2013 » InsuranceNewsNet Magazine



Labor Department delays proposal on fiduciary rule.

How to Reach Gen X When it comes to selling life insurance to members of Generation X, there’s good news and bad news. The bad news is that this generation, already underinsured, is falling even further behind in terms of coverage. The good news is that Gen X is keenly aware of it. In the midst of this news is an opportunity for advisors to broaden the discussion about how life insurance fits into the overall protection goals of a Generation X household. Chris Blunt, president of the insurance group at New York Life, put it this way, “For the cost of a flat-screen TV, Gen Xers would be providing a key element of protection for their family.” Many middle-age households are pinched by home payments, big tuition bills, retirement savings and crushing medical expenses not only for themselves but for their parents. And that was before the Great Recession. Recent data comparing current life insurance coverage to five years ago shows the coverage gap has grown over the past five years. The median amount of life insurance coverage in place for a Gen X breadwinner in 2013 was $260,000, but the amount necessary to cover a Gen X breadwinner’s household needs was $708,996, leading to a gap of $448,996, according to a survey commissioned by New York Life. In 2008, the shortfall came to $362,688. The 2013 survey was conducted by The Futures Group.



Seems like those researchU.S. Monthly Percent ers studying Gen X might Change by Age be on to something. (year-over-year) U.S. application activity Sep Aug July for individually under0-44 -3.0% -2.6% -3.7% written life insurance was down 2.5 percent in Sep45-59 -2.8% -2.2% -3.4% tember, year-over-year, all 60+ -0.3% +1.0% -0.2% ages combined, according to the MIB Life Index. However, apps were up by 8.3 percent over August, which is consistent with consumers’ tendency to put off decision-making until summer is over. Although life application activity declined across all three age groups in September, the biggest drop was in the 59 and younger segment of the population. Activity dropped by 3.7 percent among those age 44 and younger, and activity was down by 3.4 percent among those in the 45-59 age bracket. MIB analysts said the proportion of DID YOU




declining activity by age group is consistent with past trends – sharper declines in younger ages than those for ages 60+.


With life insurance ownership having reached a 50-year low, Erie Insurance has identified seven groups that are especially likely to be under-insured or lack life insurance altogether. Here’s who they are and why they need coverage: [1] Single parents. Single parents often go uninsured because they think that buying life insurance requires a big output of the two things they have in short supply – time and money. [2] Parents who both work. When both parents work, the parent making less money often discounts his or her contribution to the family. [3] Stay-at-home parents. Research shows that a stay-at-home parent contributes $112,962 annually in the form of child

THREE QUARTERS OF CANADIANS said they prefer to buy life insurance face-to-face. Source: LIMRA

InsuranceNewsNet Magazine » November 2013

care, cleaning, home maintenance, transportation, cooking and more to the family’s bottom line. [4] Homeowners. If a person dies and there’s no life insurance to pay off the mortgage, the surviving family members may be forced to move. [5] Business owners. New business owners often forgo life insurance because they think they don’t have enough money available. [6] People with a history of minor health issues. Many people confuse life insurance with health insurance, and think they won’t be eligible if they have high blood pressure or high cholesterol. [7] People whose employer provides group life insurance. This group often has a false sense of security. While they have coverage, it often isn’t enough. Another downside is that coverage is lost if they leave their employer.


Lincoln Financial Group measured the M.O.O.D. (Measuring Optimism, Outlook and Direction) of America in a recent study and found that life insurance policyholders show a high level of empowerment and a positive outlook on the future. According to the survey results, 71 percent of life insurance owners believe they are “in control,” a mindset that combines how comfortable respondents feel about their overall life, personal/family life, health and financial future. The survey also revealed that 87 percent of life insurance owners believe their life is heading in the right direction. “People buy life insurance for a lot of different reasons, but regardless of what their motivation may be, it ultimately boils down to putting a measure in place that helps them face the future with confidence,” said Mark Konen, president, Insurance and Retirement Solutions, Lincoln Financial Group. M.O.O.D. data shows life insurance is among the top five most frequently-owned financial products, ranking fifth behind other financial staples that include checking/savings accounts, car insurance, credit cards and home insurance.

I have life insurance. I don’t have life insurance.

November 2013 Âť InsuranceNewsNet Magazine



The Right to Deny When Clients Lie C  lients might not realize that lying on their app nullifies the policy even if they die of something unrelated to the lie. By Tom Virkler


eading from the application, the insurance agent asked the young military wife if she had “ever smoked cigarettes.” She answered “no” and then, understandably, left no responses for the follow-up questions asking her how many cigarettes a day she smoked and, if she was a former smoker, when she had quit. If later testimony given by the agent is accurate, he had no reason to doubt her 42

responses. He knew the client socially. He had visited her and her husband in their home and was the only one who smoked on those occasions after both had “run around the house looking for an ashtray.” The application was submitted and the coverage in the amount of $50,000 went into effect in March 1989. Less than one year later, gall bladder disease would result in cardiovascular collapse that would take the life of this insured 25-year-old woman. Because the claim was submitted within the policy’s two-year contestable period, the carrier conducted a routine investigation to verify the accuracy of the information given on the application.

InsuranceNewsNet Magazine » November 2013

What the carrier found gave reason for pause down in the claims department. Records from the military base clinic and hospital included statements by the insured that she smoked anywhere from 10 cigarettes to a full pack of cigarettes a day and had done so for seven years. The doctor’s records included the instructions he had given to her to “stop smoking!” Medical records also allowed the carrier to determine that the insured woman had misrepresented no fewer than nine other assertions regarding her health on the application. However, her smoking was the only issue for the purpose of the subsequent trial, and this article. To no one’s surprise, the carrier denied liability for payment of the death benefit. However, the carrier did send a check to the insured woman’s husband, who was the beneficiary under the policy, for the amount of premiums that had been paid. He refused the check and took the carrier to court, claiming the right to the full death benefit. The carrier moved

THE RIGHT TO DENY WHEN CLIENTS LIE LIFE for a summary judgment. In layperson’s terms, this means that the judge finds there is no real issue of fact or law and rules in favor of the carrier without the case ever going before a jury. The husband first argued that there was an issue of material fact whether or not his wife smoked. His second argument was that, if she did smoke, then that fact was not sufficient to constitute a misrepresentation significant enough to deny the claim. Despite testimony from the husband and the agent, the court ruled that the medical records established beyond a doubt that the insured woman had smoked and had misrepresented the fact on the application. Regarding the second issue pertaining to the significance of the misrepresentation, the court ruled that the actions of the insured woman fulfilled the definition of “misrepresentation in insurance contracts” under state law in that “the insurer in good faith would not have issued the policy … if the true facts had been known to the insurer as required by either the application for the policy … or otherwise.” Based on what it viewed as the significance of the misrepresentation, the court granted the request for summary judgment and ruled the policy void and that the carrier was under no liability for the death benefit. It did not matter to the court that if the insured woman had told the truth, the carrier would have issued a policy for higher premiums at smoker rates, or that a judgment could be made that simply adjusted the premium or the amount of coverage accordingly. Unwilling to accept some form of a “no harm, no foul” philosophy the court said: Most risks are insurable at some price. The purpose of the materiality inquiry is not to permit the jury to rewrite the terms of the insurance agreement to conform to the newly disclosed facts but to make certain that the risk insured was the risk covered by the policy agreed upon. If a fact is material to the risk, the insurer may avoid liability … whether or not the parties might have agreed to some other contractual arrangement had the critical fact been disclosed.

Beyond the legal issue of the effect that material misrepresentation might have on enforcement of the contract, the court spoke to a more practical concern that should discourage any consideration by a court to allow simple adjustment of a policy’s term when material misrepresentation is proven. Quoting language from an earlier landmark case – New York Life Insurance Company v. Lawrence T. Johnson, 923 F.2d 279 (3rd Circ. 1991): There are strong reasons of public policy that support the rule that an insured’s misrepresentations concerning his or her smoking history relieves an insurer of liability for the policy. Otherwise, there would be a disincentive for applicants who pose greater risk, and therefore are required to pay higher premiums, to answer application questions truthfully: the victims will be the honest applicants who tell the truth and whose premiums will rise over the long run to pay for the excessive insurance proceeds paid out as a result of undetected misrepresentations and fraudulent applications. Before we go further, we must mention at least three issues. The first addresses the advice often given to clients regarding their behavior in the time period shortly before a medical exam for coverage. Few agents at one time or another haven’t warned clients not to load up on custard pie the night before a blood test. The difference here is that the application doesn’t ask whether or not the applicant has a habit of eating custard pie and, if so, how much do they eat and how often. Nor does it ask how long ago the applicant quit eating custard pie, if they did eat custard pie at one time. In fact, unless the client makes a steady practice of such excess, the advice may result in a better representation of health for the carrier. The second issue involves the time in which the carrier detected the misrepresentations of smoking in particular and all matters in general. In the case cited in this article, evidence of smoking turned up after the insured woman’s death, when the carrier investigated the responses she made on her application. Today, carriers are much more aggressive in pursuing the

accuracy of an applicant’s answers before even making an offer of coverage. And the fact is, if you smoke, you’ve probably left a second-hand trail of evidence somewhere, whether in an admission to a doctor that is now memorialized in your medical records, or in a party picture posted by a “friend” on their Facebook page. Discovering misrepresentations early in the game could result in a decline that may make it difficult to attempt another, more truthful, application for coverage with another carrier. A third issue involves the time period within which a denial of claim is made. It seems that most cases dealing with the issue involve discovery of misrepresentation during the contestable period. But a less-than-truthful applicant should keep in mind that when courts start declaring contracts void, or they evaluate misrepresentations so material that they might constitute fraud, state law may allow for a denial of claim beyond the contestable period. Misrepresentation is not something to put to the test. Untruthfulness doesn’t seem very discoverable when comments are made to an agent in the remote privacy of a sales call. But few things focus a bright light of exposure on the lack of veracity in transactional behavior more quickly than a judicial hearing. Sometimes clients need to be reminded. Keep in mind that despite the fact that the Savage case has limited authority because its forum was a U.S. District Court, its reasoning should not be discounted in that the courts have found for lack of coverage based on material representation by the applicant and/ insured in various Federal Circuits: e.g. the U.S. 3rd Circuit Court of Appeals (having authority in PA, NJ, and DE), the 6th Circuit (MI, OH, KY, TN), the 9th Circuit (WA, OR, CA, AZ, NV, ID, MT), and the 10th Circuit (WY, UT, CO, NM, KS, OK). Tom Virkler, JD, CLU, is Director of CPS Advanced Markets, where he assists brokers, as well as other professional advisors involved in working with clients concerning matters of estate and business planning, and issues of income and transfer taxation that attend the sale, implementation and administration of products and plans. Contact Tom at

November 2013 » InsuranceNewsNet Magazine



Multi-Tasking Women Demand a Multi-Task Asset Y  oung women are looking for a financial asset that will help them build a nest egg while being protected from stock market volatility – making them perfect candidates for permanent life insurance. By Liz Michel and Cathy Neifeld


he world of the twenty-somethings and thirty-somethings is a far different world than the one that was inhabited by the baby boom generation. The current generation of young professional women (and men for that matter) grew up multi-tasking everything. This generation can download music on their iPad, while talking on their iPhone and skimming through Facebook on their laptop, all the while watching “House Hunters International” on HGTV. They don’t own “landline” phones – why would they? It is not a multi-tasking technology. Furthermore, our average multi-tasking American woman is expected to earn more than the average American man by 2028. She controls more than 60 percent of all personal wealth in the United States. She is financially conservative, is likely to use personal resources such as financial planners, views wealth as protection and (here is the great part), believes strongly in the value of life insurance, according to LIMRA research. This seems like a match made in heaven: young professional women with good incomes who believe in the value of life insurance. How do you make the connection to this potentially lucrative market? “This is not your father’s – or mother’s – life insurance.” This generation grew up with parents who (hopefully) bought life insurance to protect their families in the event of an untimely death. If the kids were paying attention (and that may be a stretch), they knew that their parents owned (probably) term life insurance that would pay a lump sum if 44

mom or dad died. The mortgage would be paid and they would go to college. Life, at least financially, would go on. But these young women may not yet be parents or even be married for that

InsuranceNewsNet Magazine » November 2013

matter – so where does life insurance fit in their lives? “The crash of 2008 scared me to death.” It scared us all. These young women weathered the storm of 2008

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-5% 0% 5% 10% 15% 20%

and now they know that the putting all their financial eggs in the stock market probably is not the best idea. They saw their parents and older friends take huge hits on their stock portfolios and 401(k) plans. They saw housing prices erode and jobs lost. They want assurances that if they start saving now they won’t lose it later. Thus, the case for permanent life insurance as an asset class. Below is a short reminder on how the stock market has performed since 1996 and what these women have seen. Selling permanent life insurance as an asset class in a low-interest rate environment, coupled with a relatively volatile stock market, makes sense. It is a great way for a young professional to diversify her investment portfolio. Because the


Another carrier’s whole life product has a cash surrender value that is equal to the premiums beginning in year three. Couple that with the ability to earn dividends in the product and you have a strong case for owning this carrier’s whole life product as an investment asset. Another carrier has an innovative indexed universal life product that is tied to U.S. treasury bonds. This is a super option for diversifying an investment portfolio. “Do you like paying taxes?” Actually, no. Well, permanent life insurance is incredibly tax efficient. The policy’s cash values grow tax-deferred and can be accessed in a tax-favored manner. This means that our young professional will not have a taxable event unless she sur-

S&P 500 INDEX BETWEEN 1996 AND 2012 12.8%

10.7% 6.2% -0.6% -0.6% -2.3% 0.5%

-2.2% -0.1%




1996- 1997- 1998- 1999- 2000- 2001- 2002- 2003- 2004- 2005- 2006- 2007- 20082000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012

The stock market volatility has women anxious about investing in equities. risk of payment is shifted to the insurance carrier, young professional women can make other, more aggressive investment choices with their other assets. Certain types of permanent life insurance, such as whole life and certain types of universal life (obviously not variable universal life or most indexed universal life) are uncorrelated to the stock market. It is a “general account product” and for most, if not all, carriers this means the underlying assets are invested in vehicles other than the stock market. One major carrier, for example, invests in “alternative assets.” Their approach, they state, can lead to higher risk adjusted returns and avoids riskier fixed income strategies. They invest in assets that are an alternative to public equities and have strong historical returns. One asset, her permanent life insurance policy, has a wealth of diversification behind it. 46

renders the policy. She can take tax-free loans up to the total premium she has paid into the policy and then take loans above this amount without incurring taxation. Thus, unlike a stock portfolio, there is no need to liquidate the asset to tap into the cash if a need arises. She can retain the asset and access cash. This feature is one of the powerful selling propositions of permanent life insurance. “Do you really believe that Social Security is going to be there when you retire?” Probably not. So, let’s talk retirement. Starting young can make all the difference. And the younger generation is even more skeptical about Social Security than their parents – so being retirement self-sufficient is critical. They don’t believe Social Security will be there when they retire and they job hop like crazy. If Uncle Sam isn’t going to fund her retirement and the chance that

InsuranceNewsNet Magazine » November 2013

she will get a gold watch after 50 years with one company isn’t in her future, a life insurance retirement plan is a fantastic savings vehicle. Imagine that our young professional starts saving at age 25, and puts aside $3,000 a year in a tax-deferred retirement account for 10 years, and then she stops saving – completely. By the time she reaches 65, her $30,000 investment will have grown to more than $472,000, (assuming an 8 percent annual return), even though she didn’t contribute a dime beyond age 35. Now let’s say she puts off saving until age 35, and then saves $3,000 a year for 30 years. By the time she reaches 65, she will have set aside $90,000, but it will grow to only about $367,000, assuming the same 8 percent annual return. That’s a huge difference. Enter permanent life insurance – specifically indexed universal life insurance. This type of permanent product offers upside potential, a long investment horizon and, depending on the carrier, the ability to invest in non-U.S. markets – another way for our young professional to diversify her investment portfolio. When she retires, at age 90 because this generation should live much longer than the generation before her, she can have amassed quite a nest egg in her life insurance retirement plan – which has stayed with her through various jobs, lots of kids, maybe a few husbands, aging parents, and, and, and … Bottom line – the young professional woman is never too young for permanent life insurance. Liz Michel, JD, has built a reputation creating successful marketing programs for life insurance transactions. She has held senior positions with large, national brokerages including Crump and National Financial Partners. Liz is also a member of AALU. You may contact her at Cathy Neifeld, JD, General Counsel and Chief Development Officer for AgencyONE, is a specialist in the arena of premium financing and complex insurance transactions. She is also a member of Forum 400, and AALU. Contact Cathy at Cathy.



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Athene/Aviva Sale is Finalized Athene Holding Ltd. has completed its $1.55 billion purchase of Aviva USA, bringing Athene closer to its goal of being a leader in the fixed annuity business. Athene President Grant Kvalheim stressed that Athene plans to continue selling fixed annuities, both indexed and traditional, and that this will be

done without a “time-fuse.” He made the time-fuse reference to head off concerns the company would be GRANT KVALHEIM looking for a quick exit because of its private equity Athene President connection. Ever since Athene announced plans to buy Aviva USA, agents have been wondering about the impact this ownership structure could have on their business and on their policyholder-customers. Those concerns arise from a commonly-held view that most private equity-owned firms tend to use a short-term business model that involves selling their acquisitions within a few years of purchase. Athene is committed to selling through independent agents and the independent distribution system, Kvalheim said. And by independent, he said he means totally independent. In fact, he said, on the same day that Athene concluded its purchase of Aviva USA, Athene also sold the two independent marketing organizations (IMOs) that had previously been 100 percent owned by Aviva USA. These IMOs are Creative Marketing International, and Insurance Agency Marketing Services.


Annuity professionals may not view health care reform as relevant to the work they typically do with clients. It’s easy to see why annuity specialists steer clear of health insurance, but they might want to reconsider. Although most annuity practitioners have enough on their plate to worry about adding health insurance to their product mix, the confusion surrounding the Affordable Care Act (ACA) could spark education and door-opener opportunities, especially with business clients. That is why annuity advisors

might want to learn about ACA after all. Because of intricacies in the ACA, employers are weighing various health benefit strategies. The jumbo and large size employers will no doubt turn to benefits consulting firms for assistance with sorting out these and other options. But many mid-sized and smaller 48

employers are likely to turn to their health insurance broker and/or their other insurance and financial experts. Therein lies the opportunity for the annuity practitioners, most of whom have at least some business owners among their clients.


Despite a tarnished reputation, annuities make sense for some clients. Even so, advisors on a panel at the Insured Retirement Institute’s annual Vision conference highlighted some of the biggest challenges they face in using annuities for clients. One of the major hurdles is the increasing complexity of annuity products. Not

only can they be difficult for advisors to understand, but explaining the ins and outs to clients represents an even bigger challenge. Some advisors don’t even like to use the word “annuity” in conversations with clients, even when the product is suitable for them.

InsuranceNewsNet Magazine » November 2013

QUOTABLE With the Dow over 15,000, consumers are hoping for some upside but trading ultimate gains for downside protection. — Janet Cappelletti, head of research for BISRA

3% IS THE NEW 5%

3% 5%

Three percent “is the new 5 percent when it comes to fixed annuities,” the chief executive officer of Beacon Research said of the credited rates insurers are offering. Total second-quarter 2013 U.S. sales of fixed annuities, including indexed, were $17.1 billion, up just 0.2 percent from the same period a year ago but sales increased 14.6% sequentially, according to Beacon. “Sequentially, it’s a

good quarter, and we haven’t had very many of these lately,” Jeremy Alexander, chief executive officer of Beacon, told Best’s News Service. The improved interest rate environment helped boost sales. “We think that 3 percent is the new 5 percent when it comes to fixed annuities,” Alexander said. “We are seeing threes – finally. If rates keep going up, and carriers loosen up their cash a little, we should see a real nice bump in sales.”

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A Look Behind the New ‘Structured Annuities’ Structured variable annuities — also known as indexed variable annuities, registered indexed annuities or just structured annuities — have begun showing up on annuity dance cards, but industry practitioners aren’t quite sure what they are. Or why they are.

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November 2013 » InsuranceNewsNet Magazine


Immediate Security for Families of Those with Special Needs A  nnuities can serve diverse purposes in addition to providing for retirement income. Annuities also can provide income for family members with special needs. By Daniel Herr


nnuities are often sold with one client goal in mind – guaranteed retirement income. No doubt, this is a powerful value proposition for annuities, but it’s not the only one. A recent Deloitte study revealed that 38 percent of Americans don’t understand annuities at all. Because the majority of online resources offer only a simplistic explanation of an annuity’s function, even knowledgeable clients may be unaware that annuities can be tailored to serve a variety of financial planning needs. As we seek to embrace diversity in our business, it’s important to remember – and demonstrate to our clients – how annuities can offer different value propositions to different populations. Nearly 20 percent of Americans classify themselves as having a disability, and for more than 38 million, this disability is severe, according to the 2012 U.S. Census. Every parent wants financial well-being for a son or a daughter. But when that son or daughter needs special care and will be unable to manage income on his or her own, ensuring that they have the financial resources available to live a life with opportunity and dignity becomes even more important. For parents in these circumstances, an immediate annuity can help family members focus on enjoying their time together instead of worrying about the future. An immediate annuity can provide income to parents while they are alive. After the parents have passed away, that same immediate annuity can fund a special needs trust that retains the annuity’s income, which in turn can 50


20% 38

of Americans say they have a disability


million, this disability is severe Source: 2012 U.S. Census

be used to help support the child financially according to their needs, and for as long as the child lives. Consider the following hypothetical family of three: Stan and Katherine live with their adult son, Jeff, who has Down syndrome. Ever since Jeff was born, Stan and Katherine have made it their top priority to give Jeff the best care and education available. Now, as Stan and Katherine are approaching retirement,

InsuranceNewsNet Magazine » November 2013

they are considering their goals for the future. They want to provide for Jeff’s expenses throughout his entire life, so that he can continue to receive top-notch care and live in housing that appropriately meets his needs. To help meet this objective, Stan and Katherine purchase an immediate annuity, which will create an income that ensures Jeff has access to special needs funds for the rest of his life. In this instance, Stan and Katherine

IMMEDIATE SECURITY FOR FAMILIES OF THOSE WITH SPECIAL NEEDS ANNUITY choose a joint payout, naming themselves as joint owners, Jeff as the annuitant and a trust as beneficiary. Katherine is named the joint annuitant on the contract, in case she outlives Jeff. As long as Jeff is alive, Stan and Katherine will receive income until they both pass away. Upon their passing, the contract and payments pass to the trust for the remainder of Jeff’s life. Then trustee will direct payments to cover any necessary medical costs, as well as any activities and services that contribute to Jeff’s quality of life. Using a properly designed special needs trust is advantageous because it can fund benefits above and beyond those received through government programs, such as Supplemental Security Income or Social Security Disability Insurance, without affecting the resource-eligibility limits for the government benefits. For example, if Jeff were to receive an inheritance of more than $2,000, he would be deemed ineligible for Supplemental Security Income. With a special needs trust, this

limit does not apply because the assets are in control of the trustee, and not in the name of the child. With this plan, Stan and Katherine know that the income they pass to Jeff through the trust will help cover his expenses for his lifetime, even after they are no longer able to oversee his care. Plus, if Stan and Katherine choose an immediate variable annuity, that income has the potential to grow depending on market fluctuations and how they impact the performance of the investment options selected. In addition, because a portion of each payment represents a return of cost basis until the basis is fully recovered, an annuitized income stream helps reduce the amount of taxes the trust will pay, leaving more funds to be used on Jeff’s behalf. This is only one of many ways an annuity can be used as a solution to meet the varied needs of diverse clientele. Each family is different, with a unique set of goals and concerns, and as advisors work to meet these goals and ease these concerns, annuities can play an

An unprecedented 2.5 MILLION VETERANS do not realize they are eligible for a little-known benefit. This breakthrough opportunity is generating countless pre-qualified appoint-


important role. Clients may view an annuity simply as a means of generating guaranteed income for retirement, but in reality, an annuity is flexible enough to do much more. For parents like Stan and Katherine, the value of an immediate annuity is the relief that comes with knowing they have taken measures to help ensure their son’s needs will always be met, and his quality of life will always be upheld. This security in knowing that their child will have sufficient financial resources also helps to offset the fees or expenses associated with the annuity. A practice focused on diversity gives many opportunities to celebrate and appreciate different experiences and perspectives. In the spirit of celebrating diversity, remember: an annuity’s function can be as diverse as the clients it serves. Daniel Herr is vice president and head of annuity product management in the Annuity Solutions division of Lincoln Financial Group. Contact him at Daniel.Herr@

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November 2013 » InsuranceNewsNet Magazine



Overcoming the Top 5 Annuity Objections M  uch of the sales resistance to annuities can be traced back to a consumer’s lack of awareness of how they work. By Eric Taylor


rospects have five objections to annuities that every seller is familiar with, but these can all be turned around to fulfill the real need clients have. Because of concerns about market volatility and low rates, now is an ide52

al time to speak about the benefits of annuities, namely the potential to earn returns greater than traditionally conservative products like certificates of deposit and money market funds while continuing to protect their contract value from market losses. Many of the common objections that financial professionals hear can be attributed to a consumer’s lack of awareness or education relating to suitability, how annuities work and their cost. Let’s take a look not only at these common objections, but

InsuranceNewsNet Magazine » November 2013

also at some suggestions on how to address them with clients and prospects.


The fees associated with annuities are too high. All annuities are not created equal. It is true that variable annuities, which have sold well over the past few decades, can include fees and expenses of 200 to 400 basis points annually. These costs can include the base contract fee, the cost of the investment options and the cost of an optional income and/or optional

OVERCOMING THE TOP 5 ANNUITY OBJECTIONS ANNUITY death benefit riders. On the other hand, fixed annuities generally do not charge explicit fees or expenses as a part of the core contract, and that means 100 percent of a contract owner’s money can go to work on day one. Many indexed annuities offer an optional guaranteed lifetime income rider, usually charging an annual fee of less than 100 basis points. Clients will find that the additional cost of the guaranteed income rider is justified by the security of knowing their income will be there for life and the added flexibility of maintaining control of their contract value. The key to overcoming this common objection is to make clients and prospects aware that annuities come in a broad array of varieties, and not all can be characterized as “expensive” to own.

of some or all interest earned, but generally do not result in loss of principal. While most annuities have surrender charge periods, generally between five and 10 years, and some also have a market value adjustment, many allow up to 10 percent in penalty-free withdrawals of contract value each year. Additionally, many have further provisions for expanded penalty-free access if necessary due to medical confinement. When faced with this objection, it is important to put liquidity into context for your clients. While money market accounts may allow for penalty-free access, compared with CDs, many annuities stack up quite favorably in the category of liquidity.


Many consumers in their late 40s or early 50s may think they are too young to own an annuity.

This is a bad economic climate to be purchasing annuities. Some consumers will point to today’s low interest rates as a reason to not buy annuities. Yes, rates are hovering near record lows with the average 5-year CD yielding just 0.78 percent a year, according to Bankrate. Money market accounts generally are offering less, with the highest yielding around 1 percent annually, according to Bankrate. Given these historically low yields, a fixed indexed annuity can provide for greater upside potential as well as protection of principal. When assets earmarked for retirement are generating interest that trails the rate of inflation, consumers may be taking on more risk than they realize. Again, many consumers may not recognize that there are different types of annuities available to them. By educating clients on the many flavors of annuities available today, this common objection can be overcome.


Owning an annuity means I don’t have any access to my funds if I need them. When looking at annuities compared with other options, it is important to know the facts. Money market accounts can offer greater penalty-free access, but as mentioned earlier, even the best options are offering only 1 percent a year. CDs often charge penalties for early withdrawals and early termination of a contract. These penalties result in loss


Annuities cannot protect what’s in my 401(k) from the market’s ups and downs. With an age-based in-service withdrawal from a qualified plan, offered by up to 90 percent of defined contribution plans today, an annuity can offer protection and guarantees on assets for those approaching retirement and still in the workforce. It is important to bear in mind that each plan may have its own set of restrictions and limitations. For the sake of illustration, let’s say your client is 59½ years old but won’t be retiring until age 65. That’s five and a half more years during which his or her 401(k) may be vulnerable to the ups and downs of the market. With an in-service withdrawal, even while still working, your client may be able to move a portion of his or her current 401(k) (depending on plan rules) as a direct rollover to purchase a fixed indexed annuity established

as an Individual Retirement Annuity (IRA). This can help protect those retirement assets from the downside of market volatility and create a guaranteed stream of retirement income. By educating your client about the ways that annuities can help protect their hard-earned 401(k) assets from market volatility, while enabling growth potential for those assets, you can overcome this common objection.


Annuities are for older, conservative investors … not for someone like me. Many consumers in their late 40s or early 50s may think they are too young to own an annuity. They may tend to view annuities as offering one main benefit: guaranteed income. What many don’t yet recognize is that annuities also can provide a platform to accumulate and grow assets on a tax-advantaged basis. The benefits of creating more guaranteed income often appeal to a more mature audience. However, by educating those still in their prime working years about the role that an annuity can play as an accumulation vehicle and alternative to traditional fixed income options such as bond mutual funds, you can address potential concerns that these products are only suited for older individuals. In general, annuities are often misunderstood by many consumers. Annuities, and in particular indexed annuities, provide a range of benefits that are not generally offered by other financial products: no explicit fees to own the product and lower fees than most alternatives if an optional income rider is selected; opportunity to create guarantees for hard-earned 401(k) assets, even while continuing to work; higher yields and growth potential than offered by traditionally “conservative” products, and better access to contract value than some conservative alternatives. Helping your clients understand the facts about annuities can demonstrate your value as an advisor and create new opportunities to grow your business. Eric Taylor is national sales manager for annuities with Genworth Financial. Contact him at

November 2013 » InsuranceNewsNet Magazine



Private exchanges offer broker opportunity

And They’re Off! Well, Sort of … Remember back in college when it was time to register for classes and everyone went online as soon as registration opened at midnight so that they could get a jump on signing up for that required class that didn’t meet until 11 a.m. and so many students got online at the same time that the system crashed? OK, now you have some idea of what happened when online signup for health insurance under the Affordable Care Act (ACA) went live on Oct. 1. The system hiccupped, sputtered and wheezed throughout the first four days of its operation. The result was that only a small percentage of those who attempted to search for health care options online actually ended up signing up for coverage.

Technology experts sprang into action, taking the website down in an attempt to repair glitches that frustrated millions who attempted to complete online registration for health coverage. Meanwhile, President Barack Obama sounded almost like David Soul singing “Don’t give up on us baaaa-by” in an interview with the Associated Press when he urged Americans not to be discouraged with the shaky rollout of the online system. Obama said public interest in signing up for care far exceeded the government’s expectations, causing the glitches.


In the midst of the turmoil surrounding the ACA rollout, insurance advisors are ready to come to the rescue. A recent survey by the National Association of Insurance and Financial Advisors (NAIFA) found that more than half (56 percent) of surveyed NAIFA members who sell health insurance intend to sell health plans through the new exchanges. The survey found many advisors are taking steps to help consumers and businesses through the ACA maze. For instance: 44 percent of the surveyed producers

indicated they are reaching out in their communities, beyond their existing client base, to assist consumers with questions about health insurance and the ACA. At least 10 percent said they have secured referrals from hospitals, pharmacists, DID YOU



doctors and other organizations that believe consumers will need expert advice in the healthcare marketplaces. For instance, a hospital system in Southwest Missouri said it will refer its patients to NAIFA members for advice, and the Tennessee Hospital Association is listing NAIFA members as reliable and trusted resources for consumers. In addition, some members indicated that they are considering participating in the marketplaces. Of those who live in one of the 26 states with federally facilitated marketplaces, for example, half said they have already taken federal training to help them guide consumers through the marketplaces. An additional 30 percent plan to take the training.


Employers are taking a closer look at their employees’ spouses, considering adding a surcharge to cover their health

DESPITE RUMORS THAT CONTINUE TO PERSIST, the Affordable Care Act does not impose an excise tax on hunting and fishing gear. Source: Albany Times-Union

54 InsuranceNewsNet Magazine » November 2013

care expenses or dropping them from the health plan completely. United Parcel Service announced last month that it would exclude spouses from coverage if they are able to obtain insurance through another employer. The University of Virginia also decided to drop coverage for spouses, starting Jan. 1, if the spouse has access to affordable health care through his or her own employer.

Twenty percent of nearly 600 large employers in a survey completed earlier this year charged a spousal surcharge in 2013. An additional 13 percent plan

to do so next year, according to the study, which was conducted by benefits consultant Towers Watson and the nonprofit National Business Group on Health. Those surcharges average about $100 a month, or roughly double what they averaged a couple years ago. The study also found that 4 percent of companies excluded spouses from their health plans when similar coverage was available through the spouse’s employer. Another 8 percent planned to do so next year.


Women are more worried about health care costs in retirement than men, and potentially with good reason, according to a report from Allsup. “Women are more likely to live longer, have fewer financial resources and rely on Social Security as their primary source of income in retirement, so their financial risks are greater as they age,” said Mary Dale Walters, senior vice president, Allsup Medicare Advisor. “Living longer usually means greater healthcare expenses in retirement, such as more premiums.”

A woman turning 65 today can expect to live until age 86 on average, which is two years longer than the average life expectancy of a 65-year-old man; about one in every four 65-year-olds today will live past age 90, according to the Social Security Administration. “In addition, both women and men are unlikely to talk to their financial advisors about Medicare and their health care costs, which can add to their financial risk in retirement,” Walters said.


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Hybrid Policies Add to the LCTi Market Challenge H  ybrid policies are entering the market to traditional long-term care insurance. Will they help or hinder this market segment?




New premium (millions)

$645 $603




2004 2005 2006


2008 2009 2010










$465 372

his month’s observance of Long-Term Care Insurance Awareness Month finds the industry aware that their product is facing yet another challenge. The LTCi market already has taken a beating from low interest rates combined with a high wave of potential claims and the increasing cost of care. Now the introduction of hybrid or combo products could give traditional LTCi products some competition. These hybrid or combo products combine life insurance or annuity products with a long-term care or critical illness rider. This gives policy holders flexibility at a more affordable rate. “I think the traditional long-term care product will continue to give up market share to the combo policies,” said Aaron Skloff, chief executive officer of Skloff Financial Group in Berkeley Heights, N.J. “I believe the combination life and LTCi policies is a very good solution for people who need the assurance that if they don’t need the long-term care coverage, then their heirs will get the death benefit.” That helps agents and advisors with one of the key objections they hear from prospects. “Consumers don’t like the idea of paying for something they may not use and they may not have a pile of cash to put into a traditional long-term care policy,” said Mark Goldberg, national sales manager with LTC Financial Partners. Multi-purpose is the word of the day with many insurance products. “I think they (hybrid products) are where the industry is heading,” said Mike Baker, director of brokerage and

Buyers (thousands)


By Susan Rupe

2012 Source: LIMRA

affinity markets, Target Insurance Services of Pennsylvania, Lemoyne, Pa. Target is a managing general agency focusing solely on LTCi. “I think we will see more growth in products that serve multiple solutions. The idea of having products that pay out whether you live, die or quit is better than having one product that’s ‘use it or lose it.’ ” Another trend that has appeared is the use of traditional life insurance products to fund long-term care. In 2013, eight states (California, Florida, Kentucky, Louisiana, Maine, New Jer-

56 InsuranceNewsNet Magazine » November 2013

sey, New York and Texas) introduced Medicaid Life Settlement legislation as a way to encourage more use of private pay dollars for long-term care through the conversion of a life insurance policy into a long-term care benefit plan. Among these states, Texas is the first state in the nation to enact this legislation into law. The law grants authority to the Medicaid department to inform and educate citizens that they already have the legal right to convert life insurance policies into a Medicaid qualified longterm care benefit plan and can choose any form of long-term care they want




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November 2013 » InsuranceNewsNet Magazine




instead of abandoning a policy to go straight onto Medicaid. “Seniors have been abandoning their life policies because they can’t afford the premiums and they’re looking at the Medicaid spend-down,” said Chris Orestis, chief executive officer of Life Care Funding. “We are seeing the trend of converting policies – selling them on the secondary market – to pay for care. It’s a great way to keep more people off Medicaid and remain private pay.” He added that the proceeds of this policy conversion are “locked” in a fund that can be used only for long-term care. The U.S. Department of Health and Human Services estimates that at least 70 percent of those over the age of 65 will require some long-term care services at some point in their lives. And every day for the next 16 years, another 10,000 baby boomers will celebrate their 65th birthday. This all adds up to a “silver tsunami” of Americans with a need for care and the funds to pay for it.

So, what is on the horizon for LTCi?

LTCi sales have been creeping upward since reaching a low point in 2009, according to LIMRA figures. Meanwhile, the number of people who will need care in the future is about to explode with the graying of the baby boom generation. Still, experts in the field are optimistic as they describe LTCi as a ship making a course correction. A number of developments have hit the LTCi marketplace in the last few years, with companies such as Prudential exiting the marketplace, companies such as Transamerica and Thrivent re-entering it and others announcing premium hikes and gender-based pricing. Some carriers are refusing to issue new policies to those over the age of 80, and women can expect to pay more in premiums than men, due to the reality that women are likely to outlive men. Underwriting also has become more stringent, with carriers seeking to be more selective in terms of accepting applicants. In August, Genworth, the nation’s largest LTCi carrier, announced it would seek $200-300 million in rate increases on all policies sold between 1974 and 2001, and on one policy sold between 2001 and 2007. Company officials said 58

November is LTCi Awareness Month

You can learn more and download consumer information guides at the American Association for Long-Term Care Insurance website:

the firm also was seeking state approval of changes that would allow Genworth to sell policies that would offer lower daily benefits and shorter benefit periods, with more stringent underwriting standards. “I think the industry overall is still getting comfortable with the amount of risk out there and the amount of pricing on that risk,” Roger Schultz, Genworth vice president of long-term care product development, said in an interview with InsuranceNewsNet. As for the headlines surrounding gender-based pricing, Schultz pointed out that most of those who apply for long-term care insurance are couples. As such, they are eligible for discounts on premiums as opposed to single individuals. He said that about 10 percent of Genworth’s LTCi policy applicants are single women. The risk plus interest rate equals price equation continues to dog the industry. It can take as long as 30 years from the time an LTCi policy is sold until the time an initial claim is made, and during that 30 years, there’s no guarantee of where interest rates on investment of the premium can go while the cost of care continues to climb. The low interest rate environment has led to apprehension and uncertainty about LTCi products, said Bradley Buechler, senior vice president of product performance at Mutual of Omaha. “Adding to the challenges, premiums have essentially doubled from 10 years

InsuranceNewsNet Magazine » November 2013

ago, benefits have been limited and underwriting has become more stringent,” he said. “At the same time, supply has been constrained, consumer demand for LTCi has increased with demographic tailwinds and the lack of a satisfactory government funding solution. The combined impact of these two forces has been that sales have hovered around a half a billion dollars for the past few years, which is half of what they were 10 years ago.” John Hennessey, general manager of American Independent Marketing in Yakima, Wash., described the LTCi industry as “right-sizing and making the necessary adjustments for survival” after being hammered by a decade of low interest rates. “I wish more companies were coming in to the market instead of going out,” he added. “If interest rates would move in the right direction, LTCi would be more attractive to carriers.” One advisor who sees something good coming out of the changes in the market is Mickey Batsell, a 29-year LTCi veteran from Georgetown, Texas. “A number of carriers saw (LTCi) as a market opportunity instead of being in it for the long haul,” he said. “What we’re seeing today is that premiums are now priced more in line with what services actually cost. Carriers now have some experience under their belt so that now they know where the market is going as far as price. It’s a good thing because the better the pricing, the more stable the product.” But no matter which direction rates are headed, and no matter how many new products enter the marketplace, one issue remains the motivating factor on whether consumers buy LTCi. “Having a personal experience with a family member needing care is the single most important event driving sales of long-term care products,” Goldberg said. Susan Rupe is assistant editor for InsuranceNewsNet. She formerly served as communications director for an insurance agents’ association and was an award-winning newspaper reporter and editor. Susan may be reached at


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November 2013 Âť InsuranceNewsNet Magazine



Study Group Evolves into Team of Retirement Experts W  hat started out as a group of women who joined forces to learn more about long-term care issues developed into a team dedicated to educating their community about retirement planning issues. By Vivian P. Gallo


hen it comes to advising on retirement and longterm care issues, five heads are better than one. That was the philosophy behind the founding of the Savvy Retirement Team (SRT), a group of women who combined their commitment to expanding their knowledge base with their passion for helping others plan for a secure future. SRT is an offshoot of a long-term care study group that began with five independent professional advisors, each with more than 25 years working in the areas of life, disability, investment and medical insurance. We became aware of each other as we stood out among our male counterparts at professional gatherings. The common thread we had was that, in addition to our individual specialties, each of us had extensive knowledge of and interest in the rapidly evolving area of long-term care planning. We then became more closely acquainted through our memberships in professional associations such as the National Association of Insurance and Financial Advisors, Society of Financial Service Professionals and the Estate Planning Council. We found ourselves seated together at one of these association meetings. As we talked, we realized that each of us offered a unique perspective, a different background and a wide variety of experiences with long-term care planning. We agreed that we should explore the possibility of sharing our knowledge and experiences as a group, informally working together, while maintaining our individual businesses. We determined that it was difficult 60

to keep up with all the changes taking place in long-term care. By dividing our efforts and sharing our knowledge, we would become better informed and better qualified to help our clients. At our first meeting in 2008, we agreed that over the next several months, each of us would select a company, analyze its long-term care products and present our findings back to the group. What started out as a project expected to take several months turned into several years’ worth of research. We met for an hour or so each month. An agenda kept us focused and enabled us to cover as much material as possible. There was nothing that couldn’t be put on the table for discussion: policy wording, underwriting, case studies, claim filing problems, industry issues, etc. Each of us contributed what she knew to whatever topic was presented. We also invited experts in various areas of senior services to meet with us as “guest speakers” in order for us to benefit from their knowledge. The group dynamic expanded as our respect for each other’s knowledge increased. We shared information on new product developments and product changes. We shared notes from seminars and classes we attended. We shared PowerPoint presentations. No one hesitated to contribute what she had learned from her individual experiences. The more clients in the 55-70 age group that we spoke to, the more we realized that something was missing. Additional issues needed to be addressed by the large number of baby boomers who were approaching retirement and were demanding information in order to make knowledgeable decisions. We discussed the need for overall pre-retirement planning that included Social Security, Medicare, long-term care insurance claims analysis and the need for

InsuranceNewsNet Magazine » November 2013

From left to right: Vivian P. Gallo, Camille A. Cosco and Christine M. McCabe

lifetime income. By the spring of 2012, the long-term care study group began to evolve into the Savvy Retirement Team. We shifted our focus away from our shared knowledge of long-term care and toward the additional distinctive areas that each member already knew well. My niche was that of a long-term disability insurance claims consultant. Christine worked in insurance brokerage, but her knowledge of the Social Security system was exceptional. Camille, an expert in medical insurance for individuals and businesses, had developed in-depth knowledge of Medicare and Medigap in response to repeated client inquiries. Once we had our topics and the specialists to handle them, we faced the task of developing a strategic business plan. We divided additional related topics among ourselves and went to work. Christine analyzed and re-analyzed every detail of Social Security. Camille broadened her knowledge of Medicare, Medicare Advantage, Medigap and Medicaid. Anne, who had an extensive knowledge of investing, developed a presentation on lifetime income options. She found that compliance issues created obstacles too complicated to overcome easily. That caused us to discontinue the segment on lifetime income strategies, so Anne’s role became that of moderator. While each of us delved further into our assigned topics, we scheduled bi-weekly meetings to maintain our enthusiasm and momentum. We prepared presentations and discussed, critiqued and modified them. Once we were satisfied, we decided

STUDY GROUP EVOLVES INTO TEAM OF RETIREMENT EXPERTS to organize a focus group of diverse pro- us received referrals as a result. In addition, fessionals to listen to our presentations and between the team members, we conducted to provide their “honest and brutally blunt eight seminars on one of our specific topfeedback.” And they did! The most import- ics: Social Security, Medicare and extended ant thing the focus group told us was that, care. We all were very busy indeed! although the material we presented was In June, we evaluated our work over the enlightening and interesting, our presen- previous six months and decided that we tations provided far needed to: 1) hire an too much informa- The most important thing outside consultant tion for anyone to for an objective look the focus group told us absorb at one sitting. at our workshops, We went back and was that our presentations 2) hire a graphic simplified our predesigner to design a provided far too much sentations, cutting logo, and 3) develop a them nearly in half. information for anyone to better system for folWe decided to preslowing up with past absorb at one sitting. ent a series of semattendees. inars for attorneys, The consultant accountants and financial planners. The helped us to tighten up the PowerPoint seminar time was set at three hours, which presentations and introduce humor to our included introductions, evaluations, a light sometimes dry topics. dinner, restroom breaks and question/ I renamed my presentation to “Aging answer time. with Dignity,” which now encompasses In the spring of 2013, the Savvy Retire- the need for both planning and claims ment Team offered four pre-retirement consulting. Camille added informaworkshops for attorneys and accountants. tion on the Affordable Care Act into her The sessions were well-attended and all of Medicare presentation, while Christine


incorporated the changes in Social Security spousal benefits for same-sex couples into her presentation. We created a spreadsheet to list the names and contact information of all our workshop attendees. This allows us to send out e-mail blasts about new developments in each of our specific areas of expertise. We also are looking forward to developing a website. From concept to reality, it took more than a year of dedicated teamwork. This has been a way for all of us to position ourselves as experts in the marketplace, form relationships with other professionals who can help us obtain referrals and better serve our existing clients. Becoming a member of such a group in your own community could pay off for you! Vivian P. Gallo, CLU, CSA, AEP, CLTC, a long-term disability claims consultant, is founder and principal of Health Resources Consultants. Contact her at Vivian.



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November 2013 » InsuranceNewsNet Magazine



Crisis Averted: For Now, At Least As this issue of InsuranceNewsNet goes to print, the nation is emerging from the 16-day-long political soap opera that could be called, “As the Government Shuts Down.” But the late-night deal that ended the stare-down Credit: Charles Dharapak/AP Photo between Congress and President Barack Obama only President Obama makes a statement postponed the final episode. On Oct. 17, Obama signed to reporters after lawmakers reached a the bill that will fund the federal government through bipartisan deal to raise the debt ceiling. Jan. 15 and extend the government’s borrowing power through Feb. 7. The bill also calls for a congressional agreement by mid-December on a long-term budget plan. Markets reacted to the news by rallying a bit on Oct. 16 after Senate leaders reached an agreement to raise the debt ceiling and reopen the government. But that euphoria was short-lived, as the Dow Jones Industrial Average was 88 points lower in early morning trading the day the bill was signed. Meanwhile, many corporate executives and analysts say that the biggest risk to the U.S. economy is none other than Congress. Washington’s policy blunders in recent years have significantly slowed economic growth and kept roughly 2 million people out of work, according to recent estimates.


It wasn’t just federal employees who were left hurting financially from the government shutdown. Everyone from the owner of House Speaker John Boehner’s favorite diner to a West Coast pesticide distributor lost money during the 16 days when most government business was suspended. Gum Tong, owner of Pete’s Diner and Carryout on Capitol Hill, told Bloomberg News that his restaurant lost about 80 percent of its business. A charter boat operator at Everglades National Park estimated his financial losses at $1,000 a day during the 16 days. Knoll, an office furniture manufacturer, estimated that it lost $10 million in federal business. Wilbur-Ellis Co., a San Francisco distributor of farm products, said one chemical, used to kill slugs and snails, was held up at a port in the Pacific Northwest while awaiting officials from the Environmental Protection Agency to get back to work. The delay means some seed won’t be protected from the pests this winter. DID YOU




But one segment of the economy apparently received a bit of a boost from the shutdown. Washington Mayor Vincent Gray told Bloomberg News that, although 13,000 fewer hotel rooms were booked during the first week of October than last year and restaurant sales dropped about 8 percent, alcohol sales in the nation’s capital were on the uptick. “People are trying to drown their sorrows in booze,” the mayor said.


Five years after Bernie Madoff made headlines for pulling off history’s biggest Ponzi scheme, five of his employees are on trial for their roles in the fraud that bilked clients out of an estimated $65 billion. At the opening of the trial, a prosecutor told jurors that Madoff could not have done what he did without assistance from the staffers who helped him lie to thousands of investors and to federal regulators. “Nobody is going to dispute that Bernard Madoff told a ton of lies – of course, he did,” Assistant U.S. Attorney Matthew Schwartz


IN 1980, 95 PERCENT OF HOUSEHOLDS used a bank branch. this year. The average increase in the first day (or “pop”) is 13 percent. That numberCapital is 50 percent now. Source: Alix Partners Source: Renaissance

InsuranceNewsNet Magazine » November 2013

Investors prepare for the end of easy money

told jurors in an opening statement at the Manhattan trial of five ex-Madoff employees. “But the evidence will show that these defendants knew exactly what they were doing. ... They did it because Bernard Madoff encouraged it and they were getting rich in the process.” The prosecutor alleged the defendants went to absurd lengths to cover their tracks. He told an anecdote about how in the middle of an audit, three of the employees needed to cook up a fake document quickly. After pulling the document hot off the printer, they put it in a refrigerator to cool it off and tossed it around to make it look older before handing it over to auditors waiting in a conference room at Madoff’s firm, he said. Lawyers for the defendants were expected to insist in their opening statements that their clients were victims of a boss who fooled them just as he did investors and regulators. Madoff is in prison serving his 150 year sentence for 11 federal felonies surrounding the massive fraud.


Janet Yellen could soon find herself as the most powerful woman on the planet, if her nomination JANET YELLEN as the Federal Reserve Board’s next chair is confirmed by the Senate. Yellen serves as vice chairman of the Fed. Before being appointed to the Fed board in 2010, Yellen served for six years as president of the San Francisco Fed, one of the nation’s 12 regional reserve banks. She headed up the White House Council of Economic Advisors from February of 1997 until August of 1999. Before serving in government, Yellen taught economics at Harvard University and the London School of Economics, according to her online biography. Her husband, George Akerlof, co-won the Nobel Prize in Economics in 2001. If confirmed, Yellen would follow Ben Bernanke as Fed chief. How much power did Bernanke have as Fed chair? Apparently, quite a bit, according to Forbes magazine. When Forbes published this year’s list of the 100 most influential people on earth, Bernanke was ranked in sixth place, just behind the Pope.


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Wanted: Retirement Advisors Social Security

A  dvisors have a responsibility to help clients see the risks posed by taking Social Security too early and not anticipating health-care expenses.

Correct Social Security decisions can increase retiree nest eggs dramatically. With little or no information regarding how full retirement age (FRA) affects benefits, many simply choose to claim benefits immediately and fail to investigate more lucrative long-term options. For example, Mary has just turned 62 and wants to claim her benefits. She is set to receive $1,200 per month. Here is what she can expect if she lives to age 92.

By Ron Mastrogiovanni


ver the past several decades, the financial services industry has maintained one steady focus: accumulating investor wealth for retirement through 401(k) plans, individual retirement accounts (IRAs) and IRA rollovers. Although this approach, accompanied by a long-term buy-and-hold philosophy, has worked well for companies and investors, that model is slowly changing.

The elements of financial planning that historically have been ignored are optimizing Social Security, working in retirement, determining out-of-pocket health care costs and planning for longterm care. For current and future retirees to maintain long-term financial stability, advisors must become educated and confident in addressing these pivotal issues facing their clients (who, by the way, hold an estimated $15 trillion in assets). With change comes resistance, and not everyone has accepted the notion that advisors should also become authorities on health care and Social Security. However, an undeniable shift is occurring across many institutions. Fidelity, Merrill Lynch and Nationwide, among others, have written extensively about bringing health care expenses front-and-center in the retirement planning domain. The good news is that advisors do not need to be experts to provide proper guidance on retirement-related issues. It is more a matter of becoming familiar with how the programs work and creating a long-term plan to help clients make the right decisions as they arise.

Understanding True Retirement Age

Gone are the days when workers could retire at 62, collect a pension after 35 years of employment at the same company, supplement their income with Social Security and expect Medicare 64

If Mary claims at...

to take over where employer-sponsored health insurance left off. Disappearing pensions, longer life spans and higher out-of-pocket health care costs have redefined retirement. There is another facet to this evolving paradigm: many baby boomers are choosing to forego the traditional road to retirement and instead are continuing with their current careers or forging into new occupational endeavors. In essence, true retirement age only occurs when a person completely stops working, whether it is 62, 72, 82 or 92.

Life Expectancy

Firms historically have used two life expectancy numbers in the planning process: 95 and 100. However, according to the National Center for Health Statistics, “Life expectancy at birth for the overall U.S. population was 78.7 years in 2011 – 81.1 for women and 76.3 for men.” This rather sizeable disparity between theory and reality results in a long-term planning approach that simply is inadequate. Creating a personalized longevity projection based on individual and family health history provides advisors with a much more effective and accurate measurement tool to determine necessary income and probable expenses throughout retirement. The evidence no longer can be ignored: the longevity variable has the greatest single impact on retirement planning.

InsuranceNewsNet Magazine » November 2013

62 66 70 - 25% penalty

full retirement

+32% bonus for deferring

every month she will receive.. 1,200 $1,600 $2,122 which means every year she gets..








and over 30 years receives in total..

432k $576k $760k


As evidenced by the chart, advisors who understand the impact of FRA on both the recipient and their spouse could augment their clients’ benefits by tens of thousands of dollars throughout retirement. There are more than 2,000 possible claiming strategies based on income, working in retirement, marriage and other variables. Advisors certainly do not need to memorize them all; specific software applications can create “what if” scenarios and perform the necessary

WANTED: RETIREMENT ADVISORS calculations based on individual client needs. The most important thing is for advisors to know that optimizing Social Security is a crucial component to the retirement planning process.

Working in Retirement

The U.S. Department of Commerce shows that more Americans are working beyond age 65, and attributes this trend, in large part, to financial necessity. In fact, most recent articles suggest that because of the market crash of 2008, baby boomers are financially unprepared to stop working at a traditional retirement age. However, research from the Pew Research Foundation suggests that boomers are not only working longer out of necessity. The majority (54 percent) of workers ages 65 and older said the main reason they work is simple: they want to. When asked directly about the impact of the recent recession on their decision to remain in the workplace, only 38 percent cited this as a reason to keep working. So, as stated before, true retirement age begins the day one stops working.

However, the decision whether to work is tightly woven into both Social Security and Medicare. Those who claim Social Security at age 62 face the earnings test, in which $1 is deducted for every $2 earned over $15,120. The year FRA is reached, $1 is deducted for every $3 earned over $40,080. There are no income penalties after FRA is reached. Bottom line: if you clients are going to continue to work, claiming early might not be the best idea.

Medicare Premiums and Means Testing

Working in retirement can also have an effect on Medicare premiums. If a single Medicare recipient earns more than $85,000, he or she is open to paying substantially higher Medicare premiums. This is called Medicare means-testing. Medicare categorizes almost all investment income, which can translate into higher premiums. Savvy advisors who are educated in the realm of health care costs would know that indexed universal life insurance policies and Roth


IRAs do not affect income. Therefore, they might be the best investment option for some clients.

The Future

Integrating these variables into financial planning has been slow to develop, but it is happening. Firms intent on maintaining client relationships understand that knowledge in these key areas will set ambitious and entrepreneurial advisors apart from the rest. Aging consumers are seeking answers as they make the transition into retirement, and those who fail to uncover the solutions will be left far behind. With $15 trillion in the balance, consumers cannot afford to ignore their risks and their advisors certainly can’t either. Ron Mastrogiovanni is president and chief executive officer of HealthView Services. Contact him at Ron. Mastrogiovanni@

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November 2013 » InsuranceNewsNet Magazine



Go to where the money is, such as a Seabourn cruise.

Lessons in Cruising Wealthy Circles Cruise season is an ideal way to mingle with high-net-worth prospects as equals. By Bryce Sanders


he first step in getting to where you want to be is acting as if you are already there.” This age-old advice holds a valuable lesson for successful agents and advisors. You are successful. You’ve built your business. Your economic situation has improved dramatically. Although you live in a great house, drive a luxury car and drop your children off at private school, you feel you are in a rut. Ten years later, you are socializing with the same people. Everyone knows you sell insurance. How do you attract wealthy 66

friends? Live the “Lifestyles of the Rich and Famous”?

It’s Not About Business

You aren’t looking for another prospecting channel. You have a different objective: to mix and mingle with the seriously wealthy, make friends and develop social relationships. If business comes, it has its own timetable. You want access.

The Luxury Cruise Vacation

Years ago, I learned about a financial advisor who built his business by taking exotic vacations priced to attract wealthy travelers. He made great friends, some of whom became clients. Focusing on the friend part first, consider taking a cruise. Once considered the preserve of “the

InsuranceNewsNet Magazine » November 2013

newlywed and nearly dead,” cruising is now hot. In 2012, the Daily Telegraph reported 20.6 million holidaymakers chose cruising, up 10 percent from the previous year. Cruising lets you rub elbows with the wealthy and successful, but choose your cruise wisely. LESSON ONE: Pick the line most likely to attract the crowd you want to meet. Cruise lines have personalities aligned to target audiences. Carnival brings to mind cheap fares, young people and partying. Cunard reminds you of transatlantic elegance and formality. Seabourn is small ship luxury. Please note: All three brands are owned by Carnival Corp. LESSON TWO: Certain routes attract

LESSONS IN CRUISING WEALTHY CIRCLES You aren’t dating, but you want to meet people. Skip hanging out at a bar and asking, “Come here often?” Seek out activities that attract thinking people, such as lectures and shipboard quizzes. Visit the dining room for breakfast and lunch during open seating. Request to be seated at a large table. If the ship has special lounges for passengers traveling in higher grade cabins, visit the ones you can. LESSON FIVE: Give to get. Entertain to get to know people better. Start entertaining. Ships can provide many services few people know about. Host a cocktail party in your cabin before a formal night. The ship can supply flowers and appetizers. Cabin too small? Ask about renting or reserving one of the smaller lounges for your exclusive use. Can they provide music? The ship should be able to provide invitations and hand delivery.

a different clientele who can afford to be away for longer periods. Different routes attract different clientele. In most cases, the longer the trip, the better. Those short “cruises to nowhere” attract more of a partying crowd. Point-to-point trips attract a better heeled crowd because airfare is an additional cost. The same rule applies to voyages departing from foreign ports. LESSON THREE: Look well-groomed and successful. Let’s assume you book a cabin, board the ship and start relaxing. You’re having fun meeting lots of people. Even though you’re on vacation, you must always dress well in clothing appropriate to your body style and age. Elderly European men might wear Speedos by the pool, but it’s not a pretty sight. LESSON FOUR: Focus on meeting people by engaging in thoughtful group activities.

LESSON SIX: Let them talk. “The person talking is the one having a good time.” Listen. The people you will meet are well traveled and like to talk. The wealthy have a travel language all their own. Sharing some of your own stories or confirming details gets you into the game. Where are they going next? If you’ve never been there, express interest. How did they choose that destination? Have they been there before? If you have visited there previously, share details and recommendations. LESSON SEVEN: Treat the staff well. They will respond by showing you the respect normally given to the very wealthy. People will notice. Be nice to the staff. Learn the names of people you see often. Greet them by name. Smile. Remember to tip. In the Old World, one of the signs of good breeding was the respect the wealthy showed to their staff. They will like you if you treat them as peers instead of servants. There are many little things they can do to make your vacation enjoyable. LESSON EIGHT: Establish an enduring bond that will last beyond the vacation. Identify interests in common. The


people you will meet are wine/travel/ cooking/golf fans. If possible, enjoy these pursuits on your vacation. Enthusiasts enjoy sharing their passion with fellow fans regardless of economic status. LESSON NINE: Make promises to do things. Commit yourself. Plan to see your new friends again or keep in touch. You have a great book on a city they plan to visit or a map to pass along. You have a great wine they might like. Take photos of everyone having a good time. Get contact information. LESSON TEN: Make the first move. Deliver on your promises. Establish a new friendship. Reach out afterwards. Print and send those photos. Opening an envelope and handling pictures brings back memories that viewing a computer image doesn’t. Send that book or the article clippings you promised. Call and stay in touch using common interests to get the ball rolling. If they live nearby, plan on getting together. If not, will they be passing through your area or vice versa?

In The Background

Do the wealthy make new friends? Yes. Are they on guard because people want something? Yes. It’s likely they have checked you out. One person we met (retired law enforcement officer) would learn where you lived and quietly check out a satellite photo of your home on Zillow! Google or LinkedIn is the more likely approach they will use early in the trip. They know what you do. You haven’t pushed business or set off alarm bells by asking too many questions. You let them do the talking. If you select an environment populated by wealthy people and you make friends, it’s logical that those new friends also will be wealthy. Bryce Sanders is president of Perceptive Business Solutions in New Hope, Pa. His book Captivating the Wealthy Investor can be found on Bryce can be reached at Bryce.Sanders@

November 2013 » InsuranceNewsNet Magazine



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

Hot Technology for Top Advisors Technology enables you to be more efficient, and to meet your clients’ expectations anytime from anywhere. By J. Leland “Lee” Davis


oday’s successful, highly productive advisor must manage vast amounts of information seamlessly while marketing the practice and managing clients and teammates. Technology allows an advisor to be more effective, but great technology allows the advisor to be greatly effective. Below is a list of current and forthcoming technology that can make running a world-class, modern wealth management practice a reality for you and your team. SmartPhone: The new iPhone 5C and 5S have just been introduced with enhanced Siri (voice enabled) capabilities. These allow a full range of spoken commands, including search, talk to text, voice dialing, e-mail and much more. The Samsung series of smartphones (S4, Galaxy Notes 2&3 or the new “Mini”) offers competing S-Voice, which executes numerous commands and options similar to Siri from the open source Android platform. Today’s new high-touch phones allow you to meet and exceed clients’ expectation anytime, from anywhere. Tablet: You can complete any project successfully with the wide variety of tablets available today, which are great for on-the-go presentations. The Sony Duo 11 Tablet PC is a powerful Windows 8 based tablet and is also a full-featured PC when you open it. There is also a Microsoft Surface tablet with a snapon keyboard. Whether you choose the latest iPad, Galaxy Tab or Windows 8 tablet, they all have a breathtaking array of apps. These apps put immediate web access to your Virtual Private Network (VPN), client data, account values, financial calculators and much more at your fingertips. HD camera: Today’s tablets and smartphones are equipped with highdefinition cameras that have extraordinary resolution and capabilities. In our office, we’ve started uploading 68

high-quality digital videos to YouTube, as well as taking compelling pictures of client events and other items, which we post on our website and in social media. This gives clients visual experiences of all the things we have going on. All-in-one desktop computers: HP, Sony, Lenovo, Asus and many others produce outstanding network-ready hardware that responds to touch, keyboard and even voice. Our team uses wired and wireless notebooks, as well as desktop PCs with multiple HD LCD monitors to manage client accounts, produce marketing materials and provide stunning service. The cloud: Client presentations, documents, account information and everything else can be safely stored for your use in the cloud, whether it’s SkyDrive, Google Drive, Dropbox or any other web storage portal. The cloud allows you to access all of your files virtually, no matter where you are and no matter what device you are using. Compliance is a factor, and due care is imperative to guard sensitive client information properly. Voice-over IP (VOIP) phones: These amazing telephones function with Ethernet connections in the office or at home. They allow clients, teammates, media and others to reach you via the internet at your normal practice extension anywhere in the world you happen to be. I have four Cisco/Linksys VOIP phones in my Colorado and Arizona offices. All of those phones, as well as my smartphone, ring when my extension is dialed, making it easy to stay in touch with clients and colleagues no matter where I am. Conferencing software: About 60 percent of our client meetings are done via web conferencing applications, such as Skype and GoToMeeting. Web conferencing allows several people to be on the line while being in different locations worldwide. These programs give the sense of “in person” meetings. Pick the programs you decide are easiest for your presentations, but don’t forget to consider ease of use on the client end.

InsuranceNewsNet Magazine » November 2013

In addition to the technology above, some of the greatest technology tools I received are through my membership in the Million Dollar Round Table (MDRT): MDRT Talk: These are short on-thego audio segments straight from experienced MDRT veterans. I’ve learned new productivity ideas, tips to master best practices and much more in 4-5 minute audio recordings. These help those new to the industry, as well as the more seasoned advisors, learn new techniques to leverage processes. MDRT Connect: This tool provides live video streaming and exhibitor resources for members to strengthen relationships and boost business. This gives members exclusive content on demand to help them better serve their clients, advance their careers and lead more satisfying lives. MDRT Network: The MDRT Network enables members to search for fellow members, topics, documents or groups worldwide. This dynamic platform encourages interaction and the exchange of ideas in a private, controlled environment. It helps members to share intellectual capital and experience camaraderie. Technology should not be intimidating, but it should complement and enhance everyday business practices. Taken one step at a time, each element can be simple for you and your team to implement with a little effort, some patience, and perhaps a competent IT professional. Combining great technology with your unique talent for finding and taking care of clients can take you to the next level in record time. J. Leland “Lee” Davis, LUTCF is co-owner of J.L. Davis Financial Corp., headquartered in Greenwood Village, Colo. A 24-year member of MDRT, Lee is a Top of the Table qualifying advisor who specializes in comprehensive wealth management for high-net-worth business owners. Contact him at Lee.Davis@


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.

Advisors Are Helping Their Clients Navigate the Intricacies of ACA A  s implementation of the Affordable Care Act (ACA) moves forward, insurance professionals have been reaching out to offer their expertise. By John Nichols


ention the Affordable Care Act to many people, and you will likely elicit some strong opinions. Whether you love it or hate it, everyone can agree that the law is making fundamental changes to America’s healthcare landscape – changes that are not always easy to understand. On Oct. 1, the health insurance exchanges opened for business. Despite numerous technical glitches on the government’s website,, and on some of the state-run health insurance exchanges, Americans are now shopping for and enrolling in health plans. The Congressional Budget Office estimates that the exchanges could attract 7 million consumers in 2014. Throughout the summer, the states have been training “navigators” to help consumers purchase plans off the exchanges, but most people will require much more advice than navigators will be permitted or able to give. No matter what our opinion of ACA, this is the reality that we as agents and brokers face.

NAIFA Members to the Rescue

Fortunately, insurance professionals with years of experience are stepping up to help those affected by the law. A new NAIFA survey shows that more than half of our members who sell health insurance will provide plans through their state or federally facilitated marketplaces. Others are still considering whether to participate in the marketplaces. Of those who live in one of the 26 states with federally facilitated marketplaces, half have participated in federal training programs to help them guide consumers through the marketplaces, and an additional 30 percent plan to take the training.

These are brokers and agents who have dedicated their careers to helping people get the right coverage and good value for their health insurance dollar. They also provide ongoing customer service after selling a plan by, for example, helping clients get procedures approved or assisting them with claims. The ACA, itself, runs nearly 1,000 pages and has spawned numerous additional regulations. Consumers need advisors now more than ever.

More than four out of 10 insurance professionals said they have spoken at town hall meetings or visited churches, senior centers and other community organizations to educate people about the law. One NAIFA member tells us: “Most small-business owners are so confused and discouraged that they don’t know what to ask, other than, ‘How much will it cost me?’” Another says, “Many consumers simply don’t know much about the ACA. Not much information is getting to them unless it comes from my office.” As implementation of the ACA moves forward, insurance professionals have been reaching out to offer their expertise in their communities. More than four out of 10 said they have spoken at town hall meetings or visited churches, senior centers and other community organizations to educate people about the law, according to the NAIFA survey. In Southwest Missouri, for example, one hospital system is referring its patients to NAIFA members for advice. Similarly, the Tennessee Hospital Asso-

ciation has listed NAIFA members as a reliable and trusted resource for consumers. I know that many agents and brokers are less than enthusiastic about the ACA. I believe even the law’s proponents will admit it is far from perfect. NAIFA continues to encourage Congress to fix the most troublesome parts of the law. “We hope that by adding sugar to the lemons,” NAIFA’s vice president of government relations Diane Boyle told attendees at NAIFA’s 2013 Career Conference and Annual Meeting, “we can make lemonade.” “NAIFA’s goal,” she added, “is to ensure that NAIFA members can continue to serve their clients and be fairly compensated for their important work.” NAIFA also continues to educate those who are drawing up the ACA regulations, and we can claim some success in that arena. We are past the early days when a regulator asked a NAIFA contingent if it would make sense to prohibit agents and brokers from speaking with clients after enrolling them in a plan. In fact, the government’s website,, now includes information on the benefits brokers and agents provide to consumers. We look forward to future success with legislators and regulators. One thing is certain about those of us in the insurance business: We are realists. We understand that the ACA is affecting our clients and other consumers right now. It is important for these businesses and individuals to know that they are not alone. The same agents and brokers who have helped them for decades are willing and able to help now. John Nichols, MSM, CLU, is the president of NAIFA and president of Disability Resource Group Inc. in Chicago. Contact him at John.

November 2013 » InsuranceNewsNet Magazine


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


Multiple-Line Exclusive Agent Channel Poised for Growth C  ompanies that use the multiple-line exclusive-agent (MLEA) distribution channel have numerous advantages over their competitors. By Laura Murach


ince the economic crash of 2008, insurance sales in the MLEA distribution channel have grown nearly 10 percent. Companies that use MLEA distribution remain in the forefront of the industry with the highest agent retention, a younger field force, large client base and cutting-edge technology. Yet as the industry continues to evolve, how will MLEA distribution adapt in a constantly changing environment? LIMRA surveyed nearly 200 multiple-line exclusive agents to explore their profile and preferences of current business, as well as their plans for the future. For companies that are forward-thinking and willing to embrace change, the future is bright. One advantage MLEAs have over other channels is tenure. The average number of years an MLEA has been with their current company is higher than that of agents with other distribution channels. Despite a recent decline, MLEAs continue to be leaders in actual four-year retention. The aging of the sales force, however, continues to confound the industry. MLEA companies have a slightly younger field force compared to other channels, yet overall there are fewer new agents entering and staying in the industry to replace those leaving or retiring. Agents’ books of business represent gold mines for additional sales. The average number of clients per agent is 1,480, and only 50 percent of those clients have auto and homeowners coverage with their agent. (See chart.) The first barrier to cross-selling is product awareness. LIMRA research has found that half of the individuals who own life 70

insurance with a company other than their property-casualty company do not even know they can purchase life insurance with their auto insurance company. Companies and their agents who break that knowledge barrier are positioned for great future growth. Most agents are satisfied with their current companies. But there are outstanding opportunities for companies to strengthen the company-agent relationship. Currently, companies invest significant financial resources to provide support to the field, but some of those services do not provide enough value to agents. A more prudent approach is to excel at the right combination of services to position the company as truly different and to attract the type of talent that the company desires. For example, companies that invest in cutting-edge technology could align their recruiting and training processes to attract individuals who flourish with advanced technology. The multi-channel and customer-centric environment has greatly influenced the agent’s practice model. How customers engage in the future will greatly affect how an MLEA will conduct business. Agents surveyed by

InsuranceNewsNet Magazine » November 2013

LIMRA said they expect to increase their use of technology to solicit, acquire and service clients. In the next three years, their use of social networking, Skype services, and video conferencing will more than double, and the percentage of new clients found via social media will triple. As the director of LIMRA’s MLEA research for the past 18 years, I have a natural affinity to this part of the industry. MLEAs are unique amid the myriad of insurance and financial services distribution channels. Today’s MLEA companies recognize the changing landscape. They are poised to adapt to the realities of multi-channel distribution and to the constantly evolving technology innovations that are part of today’s landscape. Along with all the challenges comes a limitless set of opportunities for growth in this special and distinctive distribution channel. Laura Murach, ACS, ALMI, is associate research director, distribution research, with LIMRA. As part of LIMRA’s Distribution Research Department, she is responsible for research pertaining to independent distribution intermediaries. Contact her at


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November 2013 » InsuranceNewsNet Magazine



Put Down the Device and Read! If you spend a little less time watching TV, and spend a little more time reading about financial issues, you will be ahead of your competitors in your knowledge of what is important to your clients. By Larry Barton


s a professor serving our industry, I’m often surprised – although I shouldn’t be – that so many well-intentioned and smart agents will spend so many hours each day reading company and client emails that they lose touch with important economic and investment trends around them. Each person has their own preference about knowledge sources that will empower their practice, and obviously no two advisors are alike. But as I look across the landscape, let me challenge you with a few questions, just to see if you find them interesting – and tell you why these questions may have impact for your clients. [1] What’s the number one for-profit company that has a three-year waiting list for the education it provides to grade school children in China? [2] What government bonds are in such deep trouble that some have recently traded for 60 cents on the dollar, and a complete default could trigger widespread alarm for all muni and government bonds? [3] What well-known U.S. insurance company derives more than 70 percent of all of its revenue from Japan? Don’t cheat! Read the rest of this column and we’ll give the answers at the end. So, back to the classroom. Here’s my “must read” list for any insurance advisor who intends to remain competitive and knowledgeable today and in the future: [1] The Wall Street Journal. Read every word on the front page, even if the brief summaries deal with industries, geopolitical issues or topics that don’t have an 72

impact on you. At a minimum, it will make you a better informed – and, yes, you may be tempted to turn the page. [2] Barron’s. There is no way any active person with a balanced home life can read the entire publication, but to read their Roundtables provides, in my opinion, the most provocative and candid insight from the best money managers around. Their columnists are balanced and brutal about companies that are underperforming as well as companies that are about to flourish. [3] Fortune. No other magazine spends so much time and so many resources to research facts and trends in so many disparate industries. They do their homework and take no prisoners. Many of their stories later become case studies in colleges and universities for a reason – their periscope tends to identify problem products, sales techniques, regulatory issues or other topics months before other media report on them. [4] InsuranceNewsNet. This publication and its sister website keep you up to date with your industry in a manner that is forward-looking. The writers are engaged. And no, I receive no compensation for writing this column. I think they sent me cookies last Christmas, but if not, this is a shameless attempt to suggest such to the editor. [5] and The Wealth Channel Magazine. Unbiased, updated daily and with more than 2,000 interviews with the best minds in retirement, estate planning, life insurance and philanthropy. If you don’t spend 30 minutes each week looking at the website and reading the magazine published by The American College, you are cheating yourself. This is part of our role as a public service to keep everyone informed and engaged – and if you want to see what the competition is up to, this is competitive intelligence at its very best. Audio books? Great! Kindle? Perfect! But with this column, I’m asking that

InsuranceNewsNet Magazine » November 2013

you stretch yourself even further beyond books. If you spent one hour a week less on The Food Network or ESPN, and read what your clients are reading – Kiplinger’s, Money and Wired, for example – you will be ahead of others on issues that transcend investments, retirement planning and the technology that is rapidly transforming how products will be sold and underwritten in the years ahead. So, back to the quiz. The largest for-profit educator in China is The Walt Disney Co. Go figure. Disney University already trains hundreds of thousands of managers in the U.S. and abroad each year on management and customer service as well as logistics, human relations and diversity. It makes sense that with a diamond brand that they expand that reach into education. Many experts who I read and respect believe that Puerto Rican government bonds, already under high scrutiny by the U.S. Treasury and elsewhere, are at a very high risk for default. That will be a disaster for all bonds and especially for pension funds that rely upon them for “guarantees.” We’ll be hearing more about this in the future. The company that quacks and makes us smile with each commercial, Aflac, is still driven with success because of unparalleled market share in Japan. The company is navigating Obamacare with insight on their website that is downright smart. As they learn to transition from being a benefits company to one with a broader reach, this industry, and your competitive landscape, will change. Read. Spend the money to subscribe to a few select publications or websites that you find compelling. And enjoy the journey. What you read and retain, and how you embed that information in client presentations, can be a true, distinguishing feature of your practice. Larry Barton, Ph.D., CAP, is president, CEO of The American College and holder of the O. Alfred Granum Chair in Management at The American College, based in Bryn Mawr, PA. Contact Larry Barton at Larry.Barton@


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The Tech Issue: How mobile technology can connect you to success.

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