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March 2018

ALSO INSIDE Train Your Brain for Sales Success with Daniel Goleman PAGE 10

Five Myths About Selling Final Expense Life Insurance PAGE 26

How to Reach the Emerging Millionaires Next Door PAGE 42


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March 2018



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The Flight to Fees By Susan Rupe

Health insurance commissions are evaporating, so what’s a broker to do? Read how some are finding success in pursuing a fee-based model.


34 F IA Marketing Shifts to Accumulation

8 F iduciary Standard Advances in Different Government Arenas By John Hilton Besides the Department of Labor, the Securities and Exchange Commission, the National Association of Insurance Commissioners and individual states are piping up with their own standards, but will they harmonize?

By Cyril Tuohy Volatility control indexes have offered advisors an opening to talk about higher returns and better accumulation.


26 Five Misconceptions About Selling Final Expense Life Insurance By David Duford Many agents shy away from selling final expense life insurance, although the target demographic for the product keeps growing.

28 Understanding the Differences: Partnering With P/C Agents


10 Train Your Brain for Sales Success

An interview with Daniel Goleman So much of our time slips through our fingers because we can’t focus. Meditation and mindfulness might be the remedies for our stress-filled, multitasking world. Daniel Goleman, author of Emotional Intelligence and Altered States, tells Publisher Paul Feldman how mindfulness helps advisors be better sellers.


InsuranceNewsNet Magazine » March 2018


By Dan Stanley Working with a property/casualty agent can bring business your way, but you must understand the different sales approach used in the P/C world.


32 W  ealthy Take a Shine to QLACs

By Cyril Tuohy This type of annuity helps shield against longevity while cutting taxes, something that high-net-worth investors are discovering.

38 M  illennials Demand Benefits but Need Choices, Clarity By Christy DeFrain Millennials either aren’t aware of many of their benefit options or are confused by those options.

42 How to Reach the Emerging Millionaires Next Door By Craig Hawley The ranks of the emerging high-networth are growing, and they need advisors who are accessible and responsive to their concerns.

44 Nudging Clients to Rebalance Their Retirement Portfolios By Brian O’Connell Clients’ casual attitudes toward their retirement finances could backfire when it’s time to leave the working world behind.

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48 MDRT: Clients Come First – The Rest Takes Care of Itself By Rao Garuda Seeing clients succeed is the biggest incentive in creating a thriving practice.


52 LIMRA: Generation Z Is Waiting in the Wings By Nilufer R. Ahmed The youngest generation is getting ready to make its mark on the world, and they need information on money management.

49 N  AIFA: What Top Producers Believe About Success By Thomas W. Young and Danny O’Connell Passion and identifying your ideal client are two factors leading to advisor success.


46 Boosters and Reducers: Curing Your Negative Self-Talk

50 THE AMERICAN COLLEGE: When #MeToo Meets Industry Conferences

By Jack Singer Much of our stress does not come from the events around us; it comes from inside ourselves.

By Jocelyn Wright Sexual misconduct isn’t confined to the office.

EVERY ISSUE 6 Editor’s Letter 16 NewsWires

24 LifeWires 30 AnnuityWires

36 Health/Benefits Wires 40 AdvisorNews Wires

51 Advertiser Index 51 Marketplace


275 Grandview Ave., Suite 100, Camp Hill, PA 17011 tel: 717.441.9357 fax: 866.381.8630 PUBLISHER Paul Feldman EDITOR-IN-CHIEF Steven A. Morelli MANAGING EDITOR Susan Rupe SENIOR EDITOR John Hilton SENIOR WRITER Cyril Tuohy VP MARKETING Katie Frazier SENIOR CONTENT STRATEGIST Kristi Raynor


John Muscarello James McAndrew Jacob Haas Bernard Uhden Shawn McMillion Doug Cooper Sharon Brtalik


Joaquin Tuazon Ashley McHugh Tim Mader Brad Costolo Samantha Winters Kathleen Fackler Elizabeth Nady

Copyright 2018 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 275 Grandview Ave., Suite 100, Camp Hill, PA 17011, fax 866.381.8630 or call 717.441.9357. Reprints: Copyright permission can be obtained through InsuranceNewsNet at 717.441.9357, Ext. 115, or Editorial Inquiries: You may e-mail or call 717.441.9357, ext. 117. Advertising Inquiries: To access InsuranceNewsNet Magazine’s online media kit, go to or call 717.441.9357, Ext. 115, for a sales representative. Postmaster: Send address changes to InsuranceNewsNet Magazine, 275 Grandview Ave., Suite 100, Camp Hill, PA 17011. Please allow four weeks for completion of changes.

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Nothing But Blue Sky


hat was not me. How often have we heard that? How often have we said it? We were jealous, frightened, angry — or even worse, hangry, that blood-red zone where hunger and anger overlap. We did not mean to say or do the inexplicable things we did. We were not ourselves. We can’t even remember thinking in that painful blur. I was not me. But if that is not me in those moments, am I myself in every other moment? That question might seem to be simply a philosophical exercise, but it is at the center of a growing movement. We are hearing more about mindfulness as a way out of our exasperatingly mindless days and lives. The ideas around mindfulness are seeping into not only personal development but also in all of our endeavors. In fact, the management and marketing experts our publisher, Paul Feldman, interviews will often recommend mindfulness and meditation techniques for better performance. In this month’s discussion, Daniel Goleman, a researcher and author, shares how science shows that mindfulness not only improves every facet of our lives but also restructures our brain. It takes practice to do that. As Goleman says in the interview, no kind of conditioning happens haphazardly. Working out at the gym on occasion will not have a demonstrable effect on your health and physique. But the tricky part with meditation or mindfulness is that you are not practicing to latch on with laser-like focus on something. That focus will elude you. Instead, learn to observe and detach. As thoughts blast you while you meditate, the key is not to push them away but to acknowledge them and let them float away. This is important for a number of reasons. The ostensible one is that it will train your mind to focus on what you want. But even more important, it gets to the essence of you. You learn that your emotions and reactions are not you, but something happening to you. You feel anger, for example, but you are not angry. You are not anger. 6

InsuranceNewsNet Magazine » March 2018

One of the most helpful visuals came to me while using the app Headspace. The host described thoughts and emotions as clouds against a blue sky. No matter how bad the storm is during the day, a broad, beautiful, blue sky is beyond the clouds. If you wait long enough, those nasty thoughts and sharp emotions dissipate, leaving you with a clear view. The question is, how did you react during the storm? Reactivity is almost always self-defeating. Who hasn’t smacked their forehead bloody after reacting badly to something? Maybe it is something yelled at a loved one, a child perhaps, that we and she will never forget and will one day be reverberated to her children and on through the generations. Observe and let go like it’s a balloon and watch it float away. Is something as unsubstantial as that worth destroying a relationship? Can something lighter than air really define us? The more we can separate ourselves from our reactions, the less likely our emotions will be able to drive us. They will not be allowed to grab the steering wheel. Attention is our greatest gift to give. It is what we want from our parents. When we do not get it, we are driven for attention all our lives, coloring desperation into most of our relationships. We can’t offer authentic attention without being present, focusing on the person or task in front of us. Let’s not have those vacant moments when we wonder where the time and the people went. Life happens now, in the middle of this sentence. The next step for us is to understand that these fleeting emotions and reactions do not define others either. If someone is behaving impatiently and brusquely who usually is not, that is a big clue that the behavior is not the person. Perhaps that person is suffering from low blood sugar at that moment and is hitting all your buttons. Rather than reacting, let it go. Help. We all have our hand out at all times, either needing help or giving it, switching in the dance from one to the other and the next. If we are ourselves only in the most optimal conditions, is that really us? And what

conditions created our resting selves? If we are usually anxious, was that a product of an anxious parent? So, is that even us? Everybody sitting across our desk, lunch counter and kitchen table is a version of us formed under different conditions. When we help those people — daughter, customer, stranger — with something as simple as a smile in a greeting, it is a gift to ourselves. Think of all the times in your life when the smallest act of kindness was greater than the grandest intention. Let’s start with ourselves. If we try to meditate, we are kind and not impatient. Gently let the distractions go. If we try to be someone else, let that other person go. You do you. I’ll be me. Steven A. Morelli Editor-in-chief

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Fiduciary Standard Advances in Different Government Arenas AP Photo/John Locher

to get together on a fiduciary standard, so too is the Securities and Exchange Commission trying to coordinate a rule that harmonizes with the final DOL rule. Too many cooks in the kitchen? There are concerns, for sure. “Best-interest standards for consumers are, politically, a very powerful message for a state legislature,” said Howard Mills, global insurance regulatory leader for Deloitte. “So I think there’s almost a bit of a competition between the regulators and the legislators.”

States in Play Republican Gov. Brian Sandoval signs the Nevada fiduciary bill, which extends the state’s fiduciary standard.

Besides the Department of Labor, the Securities and Exchange Commission, the National Association of Insurance Commissioners and individual states are piping up with their own standard, but will they harmonize?

By John Hilton


or several years, Department of Labor regulators were the only significant foes the industry worried about when it came to potential fiduciary rules. Those days are long gone and probably for good. The Obama-era DOL fiduciary rule is still around, but now it competes with other agencies, states and regulators all racing to pass their own fiduciary or best-interest standards. The best-case scenario for the industry has cooperation winning the day and a single set of clear, concise and fair standards being established. Odds of that single set materializing are looking longer 8

InsuranceNewsNet Magazine » March 2018

by the day, analysts say. Start with the states. So far, Nevada passed a law last summer holding all financial advisors to a fiduciary standard. New York and New Jersey are among other states with fiduciary-type standards in the works. This is a particularly vexing approach since an insurer selling nationally could theoretically have 50 different fiduciary standards to navigate. Perhaps most alarming is how state regulators are charging on well ahead of work by the National Association of Insurance Commissioners. The NAIC is developing a model law for a best-interest standard, but the states seemingly don’t want to wait. “The prospects for such conflicting standards are very real,” wrote David J. Stertzer, CEO of the Association for Advanced Life Underwriting, in a comment letter. “There is a flurry of activity addressing the standards for recommending annuities and other insurance products.” While the states and the NAIC try

State regulators have been making noise about tightening the financial advice standard for some time. And nobody was surprised when left-leaning states like New York and California emphasized rulemaking following President Donald J. Trump’s upset win over Hillary Clinton. The seismic jolt hit the following June when Republican Gov. Brian Sandoval signed the Nevada fiduciary bill. Most significantly, the law extends the state’s fiduciary standard to brokers and investment advisors. Jolt No. 2 hit in December when New York Gov. Andrew Cuomo announced a best-interest standard that would cover “all sales of life insurance and annuity products, beyond the types of advice covered by the DOL rule.” The New York version, which was followed by a 60-day public notice and comment period, is the strictest fiduciary standard to date. Although the state has a strong liberal bent, analysts were surprised by the rule’s breadth. The New York proposal imposes “burdensome compliance obligations” and “certain requirements that appear impractical,” the law firm Drinker Biddle & Reath concluded in its analysis. Likewise, the New York standard exceeds the NAIC model law, the law firm added. NAIC model laws are usually the standards that states defer to when

TIMELY ISSUES THAT MATTER TO YOU INFRONT adopting insurance regulation. While the NAIC law applies a “best interest” standard to annuity sales only, the New York proposal applies to sales of both insurance and annuity products. “With the Proposal, New York further cements itself as a unique playing field for the life insurance industry,” Drinker Biddle lawyers wrote. The New York proposal “might be construed to create a continuing duty to monitor and provide advice after the sale,” Drinker Biddle said. “In contrast, the DOL rule allows the person making the recommendation to limit or disclaim a duty to monitor.”

‘More Exposure’

The New York rule “could be interpreted to potentially impose a fiduciary obligation on insurers/annuity writers, even if the producer did not have actual or apparent authority to act on behalf of the insurer/annuity writer — and when the alleged conduct occurs after the point of sale,” the law firm said. “This may create more exposure for insurers/annuity writers in litigation relating to a producer’s alleged misconduct.” Meanwhile, the NAIC received a host of critical comments on its model best-interest standard. Organizations such as the American Council of Life Insurers

and the Insured Retirement Institute said the NAIC has a long way to go. For example, the IRI expressed concern about the vague treatment of “thirdparty producers.” Many of IRI’s insurance company members distribute their annuities through third-party producers over whom they have no direct control. The NAIC draft “will necessarily require subjective and qualitative assessments of each particular client’s circumstances, needs and goals,” wrote Cathy Weatherford, president and CEO of IRI. “Due to the structure and nature of the arrangements between insurers and third-party producers, insurers will not typically have access to all of the information they would need to make their own best interest determinations.” Most of the comment letters urged the NAIC to work with other agencies pursuing best-interest standards, such as the SEC.

Back to Full Strength

That brings us to the SEC, or the agency where many people feel the fiduciary rule debate should have started, stayed and finished. After all, the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 specifically granted fiduciary rule responsibility to the SEC. Unfortunately, the agency struggled

through political wrangling for an extended period. Only recently did the SEC get back to full strength, seating five commissioners for the first time since 2015. The SEC will likely issue its own fiduciary rule proposal in the next few months. But the good news will come if and when the SEC eclipses the DOL as the lead agency on a best-interest standard, Morgan Stanley analyst Nigel Dally wrote in a client update. “As the SEC covers a broader range of products than the Department of Labor, who only governs retirement accounts, we heard concern from some investors that these new standards could emerge as a concern,” Dally wrote. “Our view is somewhat different,” he added. “We view this as a sign that the DOL is passing the regulatory baton to the SEC with respect to individual retirement accounts.” The Labor Department is expected to spend much of 2018 reworking the fiduciary rule. Onerous aspects, such as the Best Interest Contract Exemption, are likely to be weakened in the final version. The fall could see rules put forth by both the SEC and the DOL, Drinker Biddle analysts said during a recent webinar. Given the political harmony across both agencies, it is likely they are working together, said Fred Reish, partner in the law firm. “The industry has long sought standardized rules among various regulatory bodies — SEC, DOL and FINRA — and this, in our view, suggest this may indeed be happening,” Dally wrote. Commissioners Hester M. Peirce and Robert J. Jackson Jr., both Trump nominees, joined SEC commissioners Kara Stein and Michael Piwowar, along with SEC Chairman Jay Clayton. A “fully constituted” SEC will give regulators the opportunity to put into place “a clear, consistent best interest standard for financial professionals,” IRI said in a news release. InsuranceNewsNet Senior Editor John Hilton has covered business and other beats in more than 20 years of daily journalism. John may be reached at john.hilton@ Follow him on Twitter @INNJohnH.





March 2018 » InsuranceNewsNet Magazine


Daniel Goleman reveals why mindfulness is the key to better performance


InsuranceNewsNet Magazine Âť March 2018



ow often do you wonder where the morning went? Maybe the day, week, month, even years? So much of our time slips through our fingers because we can’t focus. It is a very human problem that is amplified by today’s electronics and ever-present noisy distractions. We can’t do the work that’s necessary for our success and even pay attention to the people who are necessary for our happiness. No wonder more people are considering mindfulness as an ancient way to connect with our attention and focus. We have heard about it for years, but the science is catching up and showing that mindfulness training actually restructures the brain to increase focus and calm. And we all can use a big dose of both. This has been an area of study for Daniel Goleman, a professor, researcher and author who has been focused on brain and behavioral science for more than 40 years. He is most associated with his book Emotional Intelligence and his work on the subject. Goleman’s latest book, which he wrote with researcher Richard J. Davidson, is Altered Traits, examining the scientific research into meditation. He has been studying and practicing the subject since the 1970s, when he spent two years in India as a Harvard University graduate student. In this discussion with Publisher Paul Feldman, Goleman reveals not only what the science says about meditation but also how mindfulness helps insurance agents and financial advisors be better sellers. FELDMAN: Many people are skeptical about meditation and the benefits of it. You are a scientist, and you’ve been studying this since the early ’70s. What would you say to the skeptics?

GOLEMAN: I can understand the skepticism. It’s not something that is native to this culture. It comes from Asia. The idea that you can even train the mind is an import. We put a lot of energy into physical fitness. We put zero energy into mental fitness training. And meditation or mindfulness, in essence, are mental fitness workouts. When I first got into this in the ’70s at Harvard, my faculty advisors were extremely skeptical. There was nothing then in psychological science to support this. Brain science didn’t even really exist then. It was very rudimentary. But when I did my dissertation, there were three articles on this in the peer-reviewed literature. Now there are more than 6,000. So the data supporting this is extremely strong. When I wrote the book Altered Traits with the neuroscientist Richard Davidson, who is at University of Wisconsin, we sorted through the 6,000 and identified the 60 strongest findings. That 1 percent is what the book is about. And it supports, very strongly, the notion that mindfulness enhances focus enormously. It makes you better able to concentrate. Your mind wanders less. You can sustain that focus as needed. It also, interestingly, makes you calmer. You’re less emotionally reactive. So this means you can think more clearly, make better decisions in the moment. FELDMAN: Many of our readers, like many Americans, are Type A’s who would say they don’t have time for meditation and don’t see the value. But there is clearly value, so how do you get that across to people? GOLEMAN: Language is very important. In those cases, I probably wouldn’t use the word mindfulness. I would say focus. And

I would say there is new science showing that focus helps you in whatever this person is doing. FELDMAN: Through your research, you have scientifically proven that mindfulness training can actually change the brain’s circuitry. How does that work? GOLEMAN: The training affects circuits between the prefrontal cortex, controlling executive function, and the amygdala, which is a radar for threat and the emotional circuitry of the brain. But another thing — it’s very important for anyone in the insurance field or financial advisors, which essentially is our relationship businesses. It’s very important for them to understand the empathy. It trains a completely different set of neural circuits. There are three kinds of empathy. The first is cognitive empathy, understanding how the other person thinks. This is really important because it means you can put things in terms they will understand. It makes for effective communication. The second kind, and this is a different set of neural circuits, is emotional empathy, which means you feel with that person. It happens instantaneously, but it means to know where they’re going emotionally, which makes your message doubly powerful. But I think the third kind of empathy is the most important for finance and insurance. That’s called empathic concern — for me to actually care about people and they feel cared about. This is what creates trust in a relationship. This is what creates rapport. It’s when you have that kind of chemistry that things go best in any communication, particularly in insurance and in giving financial advice. FELDMAN: Your book Altered Traits is not just about meditating. It’s about creating lasting change. But everyone wants a quick fix. GOLEMAN: So the best analogy is cardiovascular fitness. If you go to the gym once and you work out as strongly as you can, and you never go again, you’re not going to get cardiovascular fitness. Cardiovascular fitness is an ongoing trait of your biology. It’s the same with mindfulness. If you March 2018 » InsuranceNewsNet Magazine


INTERVIEW TRAIN YOUR BRAIN FOR SALES SUCCESS do it now and then and then stop, nothing much is going to happen. But if you do it in a daily dose, just like you go to the gym several times a week, you’re going to find that slowly the brain changes. The sharpening of attention and the calming of emotional reactivity become traits. That’s who you are not just when you’re doing mindfulness but in your daily life.

being aware of your thoughts and feelings, not just run by them, which is the standard way of living. This gives you more internal choice, but it doesn’t happen right at the outset. At the outset, you’re going to notice how mad and crazy you are. They use a metaphor of a wild monkey jumping from branch to branch in Asia. That’s the way

How to Start Meditating 1. S  it comfortably, but with a straight spine, either cross-legged on a cushion or in a chair with feet flat on the floor. Place your hands loosely one atop the other in your lap or on your legs. 2. Close your eyes. 3.  Do not control your breathing. Simply breathe naturally. 4.  Focus your attention on your breath and on how your body moves with each inhalation and exhalation. Notice the movement of your body as you breathe. Observe your chest, shoulders, rib cage and belly. Simply focus your attention on your breath without controlling its pace or intensity. If your mind wanders, gently return your focus back to your breath. Start with two to three minutes, building up to five to 10 minutes. We call this a dose-response relationship in medicine. Dose-response means the more you do, the better the benefits. That seems to hold across the board for every outcome of meditation. The longer someone has been a regular meditator, the stronger the benefits become.

our minds are every day. We just don’t notice it. So, once you meditate, when you try to manage your attention, you see it for the first time. Many people say, “Well, I can’t do it,” and stop. But actually, you should keep going.

FELDMAN: Meditating is difficult for a lot of people, including me, because the mind jumps from thought to thought. How do you overcome this?

FELDMAN: That’s the hard thing. I’ve started and stopped doing this many times out of frustration. I’ve gotten apps, and I even had a personal coach who did training in my office. The benefits that I felt from that and I’ve seen are amazing. And yet, I don’t do it regularly. How do you make time to do it?

GOLEMAN: When you start to focus your mind, the thing you notice is you can’t. Your mind wanders all the time. And many people think, “I can do this.” Actually, that’s a good sign. It means that you’re looking inside for the first time. You’re starting to develop what’s called meta-awareness, which means you’re 12

InsuranceNewsNet Magazine » March 2018

GOLEMAN: The next challenge is what are your priorities in the day? We all know we should work out. I’m going to add to that that we should do some mental fitness exercise, too. Why leave it just physical?

Particularly in the game you’re in, because mental sharpness, focus, a good, positive emotional set and empathy, turning into the person you’re with, the client, are absolutely essential. I would say that this should be a part of the normal routine for people in your field because it enhances the fundamental skills you need. FELDMAN: I find it fascinating how well this research ties into your work with emotional intelligence and your book Focus, which is critical to anyone who sells, runs or owns a business. GOLEMAN: There was data collected at American Express back when they had a financial advisors unit that showed that people who are more emotionally intelligent did better as financial advisors. When I look at that in terms of what we’re talking about, there are two halves to emotional intelligence. One is self-management, which means self-awareness and handling yourself, motivating yourself. The second is relationships, which start with empathy and then go into things like being able to influence people or persuade them. I would say that the meditation I described, the mindfulness that helps you focus and maintain a good emotional state, and then the empathy training, which by the way, is different than mindfulness. It’s a cousin of mindfulness. In this, you cultivate an attitude of kindness or caring about people — people who have been kind to you, your family, people you love and care about. Then you extend it to strangers and beyond; finally, to everyone. That turns out to strengthen the circuitry for empathic concern so that you more naturally and spontaneously feel that you care about the well-being of the person you’re with. It’s absolutely foundational to have the people you’re with, your clients, feel you care about them and you’re going to find the best match for their needs. Research I’m familiar with on star salespeople shows they see themselves as advisors to their clients. They might give up a sale that is not really best for the client, which is pretty radical. But what it says is that they have such a close relationship with that person, who reciprocally trusts them and sees them as an advisor. The


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INTERVIEW TRAIN YOUR BRAIN FOR SALES SUCCESS advisor would sacrifice a bit in order to be sure that person got the best thing. And what advisors are doing, it probably means finding the best fit for the person. But doing it in a way where the person actually feels cared about. Not just, “Oh, I’m going to get a commission,” but “this person is going to be happy with what they’re getting.”

mind wanders, bringing it back. It’s very much like going to the gym and working out. It’s not that you necessarily are going to feel great. You may feel like, “Oh, man, I would rather not be doing this.” But you keep doing it because you know that the benefit is going to be good. It may be hard, as you say. The idea

What the Research Says About Different Kinds of Meditation • M  indfulness meditation: Clearly, if your goal is to increase your ability to focus and ignore distractions, mindfulness meditation strengthens the brain’s ability to do that. Mindfulness also makes us more resilient under stress. •  Mindfulness-Based Stress Reduction (MBSR): You don’t have to be a long-term expert meditator to reap benefits from meditation. The amygdala, the “fight or flight” part of our brains, is less reactive after 30 or so hours over eight weeks of MBSR practice. • L  oving-Kindness Meditation: With loving-kindness meditation, as few as seven total hours over two weeks increases connections in the brain for empathy and positive feelings. This impact is strong enough to show up outside the meditation state. •  Retreat: Meditating in a retreat setting has a different impact than a daily at-home practice ‚ for instance meditators who did retreats had a slower breathing rate, an indicator of a more relaxed metabolism. The medical establishment was surprised by findings that seasoned meditators lessened levels of activity in inflammatory genes after a daylong retreat. Each of us has our own reasons for meditating, and we make our own choices of which form to practice. The good news is that whether we go deep in retreat or wide in a home practice, meditation has payoffs. — Daniel Goleman

That is a fundamental foundation in emotional intelligence skills that you need for the business. FELDMAN: It took me a while in meditation to understand that the term “practice” actually means something — you are always practicing. There isn’t necessarily an endpoint. GOLEMAN: The point is not that you feel a particular way during your practice sessions. Like, “Oh, I feel great. I’m relaxed. In bliss.” It’s about doing the work, which is watching your breath, and then when your 14

is that it doesn’t matter what it feels like while you are doing it, but do you do it. There is a saying — the very best meditation is the one you will do. FELDMAN: Another thing I had to learn was to bring my attention back gently. I was kind of yelling at myself — “You will never get this right” and “There you go again” — kind of thing. GOLEMAN: Well, actually, that voice, that yelling, is something that you drop and bring your mind back from. It’s just another distraction, that judgment.

InsuranceNewsNet Magazine » March 2018

And, by the way, people who are very good at their game are often perfectionists, meaning they push themselves to get it right and focus on what could be better, not how well they did. That’s a very dangerous attitude to bring to your own focusing session because it means you’re going to be yelling at yourself every time your mind wanders, which is inevitable. So another thing to watch for and not be swayed by is your own judgments. FELDMAN: How does meditation affect your memory and ability to learn? GOLEMAN: Actually, that’s another scientific finding — memory and learning improve. The study was at the University of California, where students were assigned mindfulness to focus the mind and enhance memory. Then it turned out they got much higher scores on the graduate school entrance exam. So that’s just proof that it helps you learn as well as remember. The two are inextricably related. Your ability to be completely present improves. I know you can’t imagine in the beginning that you will want to do a day of meditation. But more experienced practitioners will do that on retreat. When you do that much meditation, your inflammatory genes go quiet throughout your body. That lowers inflammation, which, as you probably know, is cause for everything from diabetes and arthritis to cancer and heart disease. So, a lot of benefits show up the more you do it. FELDMAN: Openness is a key component of emotional intelligence, which was something that you described when you worked with the Dalai Lama and the other Tibetan monks you studied. GOLEMAN: The Dalai Lama embodies a kind of natural emotional intelligence that I really admire. I would like to have that someday, but I don’t know if I will. One thing that’s very interesting about him is that when you’re with him, you feel good and you feel that he cares about you. Those are very positive qualities for anyone, but they also are critically good qualities in the folks you are writing for.

TRAIN YOUR BRAIN FOR SALES SUCCESS INTERVIEW FELDMAN: Did you do any MRIs or any other tests on him? GOLEMAN: No, he’s never been studied that way. It would be poor etiquette to ask him, although he is always interested in the research. But we have done brain studies of people who have done almost as much lifetime practice as him. We calculate that he has probably done more than 100,000 lifetime hours of meditation. He gets up at 3:30 every morning and does five hours of spiritual practice. I don’t know exactly what he does, but I’m sure there was a lot of meditation in there. He goes to bed at 7 p.m., by the way. Don’t try this at home, kids. You’ve got to have a different routine. He’s probably the person that I know with the most meditation practice over the course of their life. He is in his 80s

the electrical signals of the brain]. A gamma wave appears when we have creative insight, such as when we solve a problem or when we have a particularly vivid memory. It lasts about a quarter or half second. But in these yogis, we found there was a lot of gamma in the brainwave when they weren’t doing anything in particular. That’s never been seen in neuroscience. FELDMAN: Do gamma waves relate to emotional intelligence? GOLEMAN: Well, I think that the gamma probably relates to openness. When we asked the yogis about it, they say it’s the sense of being prepared for anything, ready for everything, completely open and flexible and adaptable. It is shown in research done by my colleague Richard Boyatzis, who is a professor in the business school at Case Western

to bring to you, but you have to be ready for anything. FELDMAN: People imagine they have to meditate for an hour. How much time should they do it? GOLEMAN: It could be five to 10 minutes. Then you can make it longer gradually as you are comfortable. Keep challenging yourself. FELDMAN: Of course, even just 10 minutes could be a challenge. GOLEMAN: Well, that’s what we were talking about. You see how much your mind wanders. But every time it wanders, it’s an opportunity to bring it back if you spot it. The idea is not that for five or 10 minutes that you’re going to be perfectly still

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Daniel Goleman is working on an online venture combining mindfulness with emotional intelligence. It is an online coaching program that includes coaching certification. He is working on the project with Key Step Media. Some of the most recommended mindfulness apps are:

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now. But we’ve done research with someone who is at 62,000 hours, and we found really spectacular differences. FELDMAN: Did he and the other monks you studied possess similar traits? GOLEMAN: Yes. Very present, very caring and very positive. The classical literature says that’s what happens. So in a way, it’s no surprise. It was predicted millennia ago. On the other hand, science now seems to be bearing it out. One of the things we found with people in this category was really never seen before by brain science. That’s the gamma finding. Gamma usually shows up in our brain’s EEG [electroencephalogram, a test that records



Reserve. He and I developed the emotional intelligence instrument ESCI [emotional and social competence inventory], which is for developing these kinds of emotional intelligence abilities. Richard was doing longitudinal research with the ESCI using his MBA students. We found that the one competence that predicted this career success in life satisfaction was adaptability, which is the same thing we’re talking about with the yogis. The more adaptable you are, the more flexible, the more ready for whatever comes along, the easier things are for you, the better life goes. And I would say I’m sure it is true in sales and financial advice. You don’t know what the person is going

and concentrate on your breath. It’s that every time your mind wanders, you’re going to bring it back. That’s the action. That’s what strengthens the circuitry. FELDMAN: That strong circuitry leads to strong focus. Which is key to being a great leader, a great connector or, for that matter, being highly successful in life. GOLEMAN: Well, we’ve been talking about business, but the brain does not distinguish between your teenager and your direct report. The benefits accrue across your life, and you carry them with you wherever you go.

March 2018 » InsuranceNewsNet Magazine



Will Work for Medicaid The rumbling over Medicaid recipients being required to work

for their benefits is no longer out in the distance. The Centers for Medicare & Medicaid Services (CMS) has opened the gate for states that wish to impose work requirements on able-bodied Medicaid recipients. CMS is allowing states to refuse Medicaid benefits to recipients unless they have a job, are in school, volunteer, serve as a caregiver or take part in some sort of “community engagement.” Nine states — Maine, New Hampshire, Wisconsin, Indiana, North Carolina, Arkansas, Kansas, Utah and Arizona — already want the feds to approve work requirements. Kentucky received permission, and a lawsuit seeking to halt the requirements was filed soon after. There are no work requirements for those who are elderly, disabled, pregnant, caretakers or volunteers.


The tax cut package signed into law at the end of 2017 is expected to propel the economy – but not by much, a Federal Reserve Bank economist cautioned. David Altig, director of research at the Atlanta Fed, predicted the tax cuts will give only a slight 0.18 percent boost in the growth pace of the economy. Fed surveys found about a third of businesses said tax reform will encourage them to boost capital spending this year, but the rest don’t expect the tax cuts will make much difference. YAH! YA With population H! G growth slowing and moveet oan ! more baby boomers retiring, Altig said it is more difficult than in the past to achieve the robust growth rates the United States had during the 1980s and 1990s.

Per capita health spending for workers was $5,407 in 2016, a 4.6% increase over 2015.


Americans who receive health insurance through their jobs are using it less but spending more, according to a study. Health spending for the more than 150 million people who have employer-based coverage was $5,407 per person in 2016. That is a 4.6 percent increase over 2015, even though people’s use of almost every broad category of care dropped or stayed the same over a five-year period, according to a new analysis by the Health Care Cost Institute.


It’s still being looked at. But not with the intensity it was. — Sen. Shelley Moore Capito, R-W.Va., on the chances of an ACA repeal in Congress.

The high price tag was fueled by soaring costs for emergency room visits, surgeries and drugs administered in doctors’ offices. For example, the average price of an emergency room visit increased 31 percent, to $1,917. Admissions to the hospital for surgery averaged $41,702, a 30 percent jump over the previous year.


Janet Yellen didn’t take any time off after her term as head of the Federal Reserve ended. Three days after her last day at the Fed, she began her new duties at the Brookings Institution. The former Fed chief joined the institution’s Hutchins Center on Fiscal and Monetary Policy as a distinguished fellow in residence. Apparently moving from the Fed to being a fellow at Brookings is a thing for former Fed chiefs. One of Yellen’s Brookings colleagues will be her predecessor, former Chairman Ben Bernanke, who joined Brookings in 2014 when he stepped down from the Fed. Yellen left the Fed after serving one term as its chair. President Donald Trump decided against offering her a second term and instead tapped Fed board member Jerome Powell.


KNOW After the tax overhaul became law, 2 percent of Americans said they



received a bonus or a raise.

InsuranceNewsNet Magazine » March 2018

Source: Reuters/Ipsos poll

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Health insurance brokers are finding the shift to a fee-based practice is preserving what diminishing commissions took away. BY SUSAN RUPE 18

InsuranceNewsNet Magazine Âť March 2018



ary Franke was in the middle of a meeting with the Washington state health exchange’s CEO when he received a text that ultimately changed the direction of his practice. “It said we’re getting paid zero percent from Group Health Cooperative for their PPO plans,” Franke said. Because they were losing money on these plans, Group Health stopped paying commissions for new business. Up to that point, Franke said, he had been thinking about charging a broker fee instead of relying solely on commissions. But when he first raised the issue to a group of his peers, he didn’t receive much encouragement. “I started a Facebook group for more than 100 health insurance brokers in the Seattle area,” he said. “When I said I was thinking about charging a broker fee and I asked everyone what they thought about it, people said, ‘Good luck with that. Tell us how that works.’” But Franke was undaunted in his effort to move to a fee-based practice. Today, when you visit the website for Franke’s agency, Achieve Alpha Insurance in Bellevue, Wash., you can watch a video on enrolling in health insurance, book an appointment online and view a list of the fees Franke charges. The list of fees is simple and straightforward: » Option 1: No fee if a prospect enrolls in coverage using Franke’s online video web platform as their own, provided that the prospect lists Franke as their broker. Despite this option being fee-free, Franke says his company is still available to support clients with any needs they have during the year. » Option 2: If Franke or his staff helps a prospect sign up and enroll in coverage, the fee is $99 for one person or $198 for two or more people. » Option 3: If a prospect buys a life insurance or disability insurance policy from Franke, he will waive the broker fee for one year. Franke’s move to a fee-based practice comes as health insurance brokers try to adapt to a world where commissions on individual plans are evaporating. Before the Affordable Care Act

implemented the medical loss ratio (MLR) on insurers, broker commissions averaged 5 percent based on monthly premiums for individual plans, according to a Modern Healthcare report. Today, many Blue Cross plans as well as four of the nation’s largest health carriers have reduced or eliminat-

Gary Franke ed commissions for individual plans. In a 2016 survey of its members who sell health insurance, the National Association of Insurance and Financial Advisors (NAIFA) found 93 percent experienced reduced or eliminated commissions on the sale of individual health plans. More brokers are looking at moving to fees as a way to get paid to serve their clients, according to another NAIFA member study. More than half of the NAIFA members surveyed said they would charge fees if commissions continue to remain low.

Move With Confidence

For the past two years, Franke has charged a fee to enroll people in individual health insurance. He said that he started the move to fees “with confidence.” He informed people in advance of his plan by writing a blog about it and sending it to his clients. He also added information about fees to his PowerPoint slide deck and created a YouTube video on the subject. Prospects who call his office receive a voicemail message in which he spells out the fees. Most clients responded positively to the move, he said. “About 45 percent said, ‘OK, fine, you probably should have charged this years ago. We didn’t know how you got

paid, and we didn’t want to ask,’” he said. “Another 25 percent said, ‘Well, OK, fine, that’ll work.’ The third 25 percent were like, ‘Well, I don’t know.’” Now that he has wound up his second year of charging fees, Franke said. “People know what to expect. They said, ‘Yeah, we know you have a fee. Yeah, I’m willing to pay it.’” One reason many clients were willing to pay the fee, Franke said, is because so many brokers in his area have left the individual market. In addition, Franke’s practice serves many workers who serve as independent contractors to the technology industry, so they have to buy their own health insurance. “Consumers are saying they want help, they have issues,” he said. “Mainly, we’re getting more people who have problems. Or we’re seeing people who don’t want to deal with it; they’re saying, ‘Dude, just figure it out for me and do whatever.’” Franke estimated that he lost about 5 percent of his clients when he switched to a fee-based practice. But he made about $24,000 in broker fees during his first year of charging fees and made between $25,000 and $26,000 in fees in 2017. That amount might not seem like a lot of money, but Franke said by charging a fee for individual health insurance clients, “at least we cover our overhead and make some money on it, and then we cross-sell life and disability and accident plans.” Franke said one result of moving to a fee-based practice is “it gave me a more unbiased approach to health insurance. People like that because they’re paying me to find them the best coverage.” As an example, he mentioned that some brokers in his area had stopped selling one particular health plan in favor of another one that was more expensive. “I didn’t think it was ethical for me to do that. Let’s say it might cost the client an extra $600 for the year for a roughly similar plan. From that perspective, if I charge a $200 fee and the plan would have cost them an extra $600, then I just saved them $400.”

A Work in Progress

For Cathy Bajkowski, moving to a feebased practice for her clients is “a work in progress.” Bajkowski is owner of CB Health Insurance in Elmhurst, Ill., specializing in health insurance for individuals and employer groups of 50 or fewer.

March 2018 » InsuranceNewsNet Magazine


COVER STORY THE FLIGHT TO FEES Bajkowski made the move toward fees in September 2016 after watching commissions decrease since 2010 and wondering “When will it end?” After being inundated with phone calls one month and realizing that enrolling a client in coverage can take up to five hours, Bajkowski said she “hit a wall.” “I realized that my time is worth more than this,” she said. “I’m not doing this for free.” Two years ago, Bajkowski said, she began charging a fee to those she helped sign up for coverage outside open enrollment periods. From there, the decision was made to move to a fee-based practice. “We initially were concerned we would lose some clients, but we gained time and control over our practice,” Bajkowski said. “And we signed 45 new groups during this most recent open enrollment period.” CB Health Insurance’s website includes an explanation of why fees are charged. The explanation describes how agent commissions have been cut since 2010 as a result of the MLR. The website also notes that most Illinois health insurers aren’t paying agent commissions for individual policies sold outside open enrollment, while many group health insurance carriers have cut their commissions by 40 percent. “For those who would like the expert advice of more than 25 years in the health

Her advice to a broker who wants to move to fee-based? “Don’t be afraid to do it. You have value, and you provide a service that’s worth something.” The impact of implementing fees “has been very positive,” she said. “Nobody we helped has come back to us later and said, ‘Oh my gosh, that wasn’t a good value.’”

The First Step Is Mental

Cathy Bajkowski insurance business, we are confident that you will find the fee is worth it for the time saved and peace of mind that you have the coverage you need!” the website states. Bajkowski charges $250 to individuals to run quotes and check provider networks. For groups, she charges a one-time setup fee of $250 for groups of one to four members, $500 for groups between five and nine members, and no fee for groups of 10 or more. She will do a free 20-minute initial consultation to determine whether she is able to help a client obtain coverage.


InsuranceNewsNet Magazine » March 2018

The first step in moving to a fee-based practice is a mental one, according to a consultant who has advised many brokers along this journey. Karen Kirkpatrick is owner of On Your Mark Consulting in Bronson, Mich., and has conducted a number of industry seminars on making the switch. “It starts with the mental shift to change from the known to the unknown,” she said. “Brokers have been so geared to receiving commissions, to letting someone else make their mind up about what they can sell, to whom they can sell it, how long they can sell it and how much they’re able to earn from those restrictions that they’re like a bunch of sheep walking around.” Everyone at the agency must be on board with the change to fee-based, Kirkpatrick said. After the decision to change is made, the next step is realignment. “You have to realign your resources, your staff, your producers to be able to support this model,” she said. At the root of establishing a fee structure is determining each client’s return on investment (ROI) to the agency, Kirkpatrick said. “Most brokers don’t know what their profit per individual is on their individual market book of business,” she said. “They don’t know what their return on investment is for the agency per producer, per account executive — even per client.” In addition to determining ROI, the broker must determine their value proposition to retain those clients with the highest ROI and to cross-sell those clients whose ROI isn’t as high and get them higher. “You can take an independent agent with six employer clients, representing 3,000 lives, and they could be good with those six clients and double their revenue simply by cross-selling other products,” Kirkpatrick said. Kirkpatrick recommends having everyone in the agency do time tracking to determine how much of the agency’s

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COVER STORY THE FLIGHT TO FEES resources go to each client. “I have them select one or two clients in four different categories: the smallest and largest clients with the most product lines and the smallest and largest clients in terms of revenue. They need to pass sheets out to everyone in the office who touches that client and keep track of how much time they spend on that client.”

Educated Guessing Game

Green, Yellow and Red

Kirkpatrick said the combination of determining ROI and using time tracking will help a broker assign their clients into one of three categories: green, yellow and red. “Your highest ROI are your green clients, then the yellow and then anything under 25 or 30 percent ROI falls into the red category,” she explained. “That means when a green client calls or sends an email, that’s high alert — the agency addresses it right away. Yellow clients have a 24-hour turnaround. Red clients, the agency will organize its calendar to manage their administrative needs.” Most agencies, she said, “are doing it backward.” “Everyone allocates their resources based on size of client or high name exposure of the client, and it’s done wrong,” she said.

Karen Kirkpatrick more products and services. So if that isn’t backwards, I don’t know what is.” The next step is for brokers to determine a goal for their agency’s earnings, Kirkpatrick said. “Some say, ‘I would like to make what we made five years ago.’ Some say, ‘I would like to make what we made 10 years ago.’ Some say, ‘I just want to double where we are right now.’ And it’s a little bit of a guessing game when you are establishing the fees

Establishing fees amounts to an “educated guessing game,” Kirkpatrick said. It takes into consideration all of the products and services a broker offers, the broker’s commissions data, the time tracking, and ROI per client. “And then you start to do potential revenue breakdowns based on those fees,” she said. “It could be anywhere from $20 per employee per month up to $100 per employee per month. And someone might look at that and say that’s not even possible. Well, it is, because we see in the PEO [professional employer organization] industry that on average it’s $75 per employee per month. And that is for all coverage, for payroll, for HR. You know many brokers are getting into all those spaces with all the extras they provide to their clients.” Offering workers’ compensation insurance is another feature that brokers could partner with a property/casualty agent or bring in the P/C side of their agency, if they have one, to add to their group client offerings, Kirkpatrick said. “So, outside of the ‘we’ll hire and fire and do employee terminations for you’ — you could do everything else from a PEO model. So why wouldn’t you be able to charge and demand $60, $70, $90 a month per employee if you’re offering those goods and services?” If a health insurance broker is working with a P/C agent or the P/C side of their agency, then they could come up with a three-tiered fee structure depending on what services they will offer to their clients, Kirkpatrick said. But for brokers who are working only with life and health insurance, she said, a good start is to establish what she called a “Tier 1 model,” where the baseline is an amount that covers operational costs with perhaps a 10 or 15 percent profit, and then decide what will be included in that fee. “Do you remove all commissions from all products? Or just remove commissions from health insurance and then you still get commissions on ancillary products? Are you going to include a basic HR service, basic benefits administration, COBRA flex, plan documents, 5500s, full-blown

“Brokers have been so geared to receiving commissions, to letting someone else make up their mind about what they can sell … that they’re like a bunch of sheep walking around.” Kirkpatrick said brokers also need to know the agency’s operating costs, which will be taken into consideration when determining ROI. Commission earnings also are a factor. “If you’re looking at 2017 commissions to get an estimate of ROI for a client, then you want to look at five years prior and see what your commissions were and see what kind of a hit you’ve taken,” she said. “Most of my clients, when they’ve done this, see they’ve probably taken a 40-50 percent hit in their commissions, yet they’re including 22

but you are taking into consideration the ROI and the commissions earned for that client.” In coming up with a number to charge for a fee, Kirkpatrick recommended starting out with establishing a per employee/ per month fee for group clients. “This will allow you to consolidate and provide a flatrate fee if a group client wants an all-inclusive monthly fee or an annual fee or whatever. But at least you have the hardest part done, which is determining the per-employee fee.”

InsuranceNewsNet Magazine » March 2018

THE FLIGHT TO FEES COVER STORY human capital solutions with payroll and talent management and all those things? So that could be the difference from Tier 1 to Tier 3, [and it] could be anything from $22 per employee per month to $80 per employee per month.”

Selling Fees to Clients

How difficult is it to explain the fee-based structure to clients? Kirkpatrick said it’s not difficult as long as the broker is transparent with the client. Here are her suggestions for approaching the subject. Tell the client that although you receive commissions from a carrier, you don’t always agree with that carrier’s product offerings. You would like to be able to present the client with different products that may be better for them but may not always come with commissions. You cannot work for free. So although you are being paid by the carrier to sell insurance, that payment is only for selling the product. What about all the client meetings, enrollment assistance and HR assistance — who is paying for that?

Rob Krieg and Woody, a health benefits firm serving midsize employers in Durham, N.C. In setting a fee for group clients, Krieg said his staff first estimates the resources that their firm will use for a particular client over the next 12 months.

commissions usually go to offset a consulting fee agreement his firm has with its clients. The employer clients get a choice, Krieg said. Does the client want Krieg’s firm to carve out all the commissions and have the client pay the firm directly? Or does the client want to have the commissions offset the consulting fee? Although Krieg said his clients have responded favorably to the shift his firm made to fee-based over the past five years, some clients needed to be educated about the reasons behind the move. “Our long-standing clients remember the days when we provided all these services and we were paid from our carrier, and they ask, ‘Why do we have to sign this fee agreement?’ So we try to codify it to them: Here is what we provide, here is what we get paid, here is the dollar amount on a peremployee/per-month basis.”

From Brokerage to Consultant

Krieg said his firm’s move toward charging fees came along with its shift in focus from being a benefits broker to being an employer consultant. His advice to others who are thinking about moving to a fee-based practice is not to be afraid to have the “consultant conversation” with clients. “We want to be consultants for our clients, and the best way to show them we are acting in their best interest, that we are their trusted advisor, is by having an agreement with that client where they are compensating us,” he said. “Our allegiance must be with our clients. And moving to a fee-based structure really helps demonstrate that. It removes any conflict of interest.”

You cannot work for free. What about all the client meetings, enrollment assistance and HR assistance — who is paying for that? An alternative way she suggested to approach the subject would be to tell the client that the carrier commission covers the cost of holding an enrollment meeting for health insurance and helping the client determine the plan that is best for them. But if the client needs the broker to do enrollment assistance or claims advocacy, then there will be a fee.

Setting the Pricing Calculator

A variety of factors go into what Rob Krieg called “the internal pricing calculator” that determines the fees his firm charges its group clients. That fee usually is set up as a per-employee/per-month amount. Krieg is area vice president for health and welfare consulting with Hill, Chesson

“That could be how much of our time and resources will be needed for our underwriting team, or our health management team, their communication needs, how many live enrollment meetings will they need us to lead, how aggressive of a health management or wellness program will they need us to lead or create for them,” he said. “We’ll look at factors such as the size of the group, their location. A variety of factors to go into this pricing calculator to create a price that we would then translate into the per-employee/permonth fee.” Krieg said his firm has experienced diminished commissions, much as other brokers have seen. But although they are still receiving carrier commissions, those

Susan Rupe is managing editor for InsuranceNewsNet. She formerly served as communications director for an insurance agents’ association and was an award-winning newspaper reporter and editor. Contact her at Susan.Rupe@innfeedback. com. Follow her on Twitter @INNsusan.

March 2018 » InsuranceNewsNet Magazine




SEC Looks at MetLife The Securities and

Exchange Commission is looking into MetLife’s failure to pay some workers’ pensions. The insurer said it is responding to the SEC’s questions and is not aware of any intentional wrongdoing in connection with this matter. The SEC has inquired about payments that MetLife failed to make for people who receive a type of annuity benefit from the company via its retirement business. Less than 5 percent of 600,000 people are affected, MetLife said. In December, MetLife announced that it was undertaking a review of practices and procedures used to estimate its reserves related to certain group annuitants who MetLife said have been unresponsive or missing over time.

Percentage of age groups shopping online for life insurance:


Baby Boomers




Gen X


The baby boomers didn’t grow up with the internet, but that isn’t stopping them from using the web to find information on life insurance, according to LIMRA research. LIMRA found that baby boomers are more likely than those of younger generations to say they used at least one online information source when shopping for life insurance. Younger generations – Generation X and millennials – may be perceived as more computer savvy than their elders, but LIMRA found these DID YOU




younger consumers were more likely to turn to friends and family to learn about life insurance. LIMRA also found millennials are more likely than older generations to work with a financial professional. This follows a life industry trend that shows younger buyers don’t often have much knowledge of the product, and so they are more likely to depend on a professional for guidance.


Artificial intelligence – or AI – continues to gain ground in the underwriting process, according to the Society of Actuaries (SOA). An SOA report concluded that allowing machines to take over basic functions means underwriters can be redeployed to more valuable jobs such as building new underwriting rules and data fields. And AI is speeding up policy delivery,

Brooks Tingle was named CEO of John Hancock Insurance. Source: John Hancock Insurance

InsuranceNewsNet Magazine » March 2018

Everything we’re doing now and even the older stuff is becoming mobile-enable. — Jim Galli, executive vice president of business strategy and innovation at Legal & General America

too. One-quarter of insurers said they sent the policy electronically to the agent or broker/dealer, and 21 percent of companies sent the policy electronically directly to the policyholder, the SOA found.


News of the sale of one company’s life operations and mergers within two other life companies hit the industry in the past month. Liberty Mutual announced it is selling Liberty Life to Lincoln Financial Group for about $3.3 billion. The sale will allow Liberty Mutual to focus on its property/casualty business, company officials said. MetLife announced it will merge its subsidiary, General American Life, into another subsidiary, Metropolitan Tower Life. Metropolitan Tower will continue as the surviving entity after the merger. American National Insurance announced it merged two of its subsidiaries. American National Life Insurance Co. of New York merged into Farm Family Life. The merged company will continue operating under the American National Life Insurance Co. of New York name.

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Five Misconceptions About Selling Final Expense Life Insurance The target demographic for final expense life insurance is growing, although many agents shy away from selling it. By David Duford


ith 10,000 baby boomers turning 65 each day until 2030, this age group is a growing and popular market for final expense life insurance. However, with the number of television and junk mail advertising hawking “no questions asked” final expense insurance, it’s easy to understand why some life agents aren’t exactly sure whether selling final expense life insurance is a legitimate, long-term opportunity. I have sold final expense exclusively 26

since 2011, so I want to help life insurance advisors determine whether this market fits their personality type, and whether the final expense business is a viable longterm career path for them.

Misconception 1

Final expense is difficult to sell because prospects are older and not in good health. Final expense life insurance is normally sold to people 50 and older, most of whom are on a fixed income. Understanding that final expense prospects skew older, some life agents believe these prospects are not in good health, thus difficult to qualify for coverage. However, if the new final expense agent sets up his business appropriately, older age and health issues are not problematic

InsuranceNewsNet Magazine » March 2018

to cover. I recommend that agents who are new to final expense broker different carriers. Representing multiple insurance companies allows the final expense agent to offer the coverage most optimally designed for the prospect’s health. In the final expense business, no two carriers underwrite identically. Even more, final expense products allow for underwriting flexibility normally not found in fully underwritten products. For example, final expense brokers can cover chronic obstructive pulmonary disease, diabetes, heart disease and cancer as well as mental health issues. This opens the opportunity to provide quality coverage to a variety of people who are in poorer health.


The phrase, “The policy that stays is the policy that pays,” is the philosophy all final expense agents follow. Therefore, if you’re interested in selling final expense, you’ll find your carriers provide fully underwritten coverage to more prospects who normally are declined. And insuring more prospects helps more people and increases your production.

Misconception 2

Final expense prospects are on a fixed income and thus are not good prospects. Most agents who are not involved in the final expense market are interested in selling exclusively to white-collar prospects. These prospects have more discretionary income and more problems that life insurance can solve. When looking at blue-collar prospects — specifically those in the final expense demographic — many life agents struggle to understand the market opportunity. Agents wonder how they can make a living from selling to prospects who take home a monthly Social Security check that ranges between $1,000 and $1,500 a month. As in business, what you make isn’t as important as what you keep after expenses. In many cases, our government subsidizes final expense prospects, allowing them to keep more of their monthly check. For example, programs exist to help older Americans reduce the costs associated with health care, rent and other bills. The result is more discretionary money for the prospect to spend on things such as final expense coverage. Additionally, final expense prospects are extremely motivated to buy. Why? It’s because someone they loved died recently, thus they recognize their own mortality. A loved one’s death amplifies and justifies the need for final expense coverage, especially in the sad circumstances where the loved one did not have life insurance in place.

Misconception 3

The market for selling final expense is extremely saturated, leaving little opportunity. More insurance agents in other lines are transitioning into final expense. For example, many agents are leaving the Medicare, mortgage protection and health insurance markets to sell final expense. Due in part to the growing interest in selling final expense, response rates for direct mail lead generation have decreased. Because of these factors, agents interested in final expense think, “With more agents selling final expense, how likely will I achieve success?” Luckily, despite more interest, final expense is still a great career opportunity. Agents can overcome saturation concerns by keeping high levels of prospecting activity. Additionally, final expense is not a technical product. Final expense is simple to explain to prospects. And if you’re halfway good at presenting and finding a quality plan for your prospect, the odds are high they’ll buy. Final expense prospects rarely shop your rates.

Misconception 4

All final expense coverage is overpriced, suboptimal coverage. Agents who have a cursory understanding of final expense draw their experience from TV and junk mail ads. When investigating these final expense products, agents find these products don’t offer full coverage, or are increasing term policies. Therefore, they conclude that final expense products are generally low quality. Thankfully for the final expense agent, this is true only of the “brand name” carriers who market via TV and junk mail. Independent final expense agents

representing multiple carriers have access to products that do basic, simplified issue underwriting, while offering full first-day coverage at rates substantially lower than the brand-name carriers offered on TV and through the mail.

Misconception 5

Only high-pressure sales tactics work to convince prospects to buy final expense. Many agents interested in selling final expense insurance worry that they will have to sacrifice their values and browbeat their prospects into submission before they buy. While there are agents who aggressively push final expense onto their prospects, the final expense agents who close a lot of business consistently follow a more educationally driven approach to closing business. Final expense agents who focus on soberly describing how the product works relative to those products advertised on TV and in junk mail convert prospects who are higher in quality and keep their coverage longer. Plus, the agent’s new client appreciates the time and care they took to educate the client on his options, thus increasing loyalty to the agent. The phrase, “The policy that stays is the policy that pays,” is the philosophy all final expense agents follow. And although they’re concerned with high production, final expense agents are focused on selling a policy that’s both easily affordable and matches the prospect’s insurance needs. David Duford is the owner of Final Expense Agent Mentor, Chattanooga, Tenn. David may be contacted at david.

March 2018 » InsuranceNewsNet Magazine



Understanding the Differences: Partnering With P/C Agents Recognize the different approach to a sales mindset when partnering with property and casualty agents. By Dan Stanley


very agent understands the importance of customer retention and the value of cross-selling multiple products. Failure to create a successful cross-selling culture is not unique to life agencies or property/casualty firms; however, I believe a great opportunity to build a cross-selling platform lies in partnering with a P/C agency. Many P/C agencies find it difficult to generate significant life revenue. Significant life revenue could be defined differently by many people. Based on my experience with P/C firms, the average business-owner client represents a minimum of $20,000 in life commissions. Is this worth pursuing? A P/C firm with 200 business-owner clients has $4 million of potential life revenue sitting on the sidelines. Is this revenue meaningful enough? More important, these clients face significant unfunded liabilities. As risk managers, P/C agents have a responsibility to identify these liabilities and look at ways of solving these complicated problems. If they do not build a strategy to approach these business owners, someone else will. With such an opportunity, why is there such a struggle to build successful cross-selling platforms? To answer this question, we need to better understand some of the challenges preventing success.

The Sales Psychology

The dynamics of the sale are uniquely different, and the approach by the producer is remarkably different. P/C insurance is generally a needs purchase. P/C agents are selling a product that clients generally agree they must have. Clients processing information from the position of “need” take on an entirely different perspective. 28

While service, experience and reputation always matter, the sale to a new customer is heavily price-driven. In fact, the renewal can be generally price-driven as well. Life insurance is a voluntary purchase, which requires a different approach. The purchase is very personal, sensitive and generally for the benefit of everyone but the insured. The process is much longer and requires constant attention along the way. Not only do you have medical and financial underwriting hurdles, but the client may require some tax and legal work to finalize the transaction. Successful life insurance agents do not sell life insurance. Rather, they identify

The risk of losing their core business is far too great for some P/C agents to begin approaching clients about other services; therefore, avoidance is at times the most common tactic. Ironically, this eventually exposes their business to outside advisors who eventually will discuss life insurance solutions with their clients.


I have not met an insurance advisor unwilling or uncommitted to building their practice. The fact is that everyone would like to experience organic growth. The lack of commitment has less to do with desire and more to do with trust. The

A P/C firm with 200 business-owner clients has $4 million of potential life revenue sitting on the sidelines. Is this revenue meaningful enough? problems that businesses or families have and offer solutions to fix those problems. The life agent must move the client from a voluntary position to a needs mindset. Until the client believes this requires attention, nothing will be done. This is why a majority of life insurance sold within a P/C firm is what I call “ticket taking.” Clients determined somewhere along the way that they “require” $5 million of term insurance. They call looking for options, and the agent ends up filling that ticket order.

Knowledge Insecurity

P/C agents can face a number of difficulties in selling life insurance, including a lack of knowledge about life insurance products, their uses, funding methods and design methods. This lack of understanding and overall insecurity will prevent P/C agents from approaching their clients about life insurance.

InsuranceNewsNet Magazine » March 2018

P/C agent must trust the life insurance advisor to complement the work the P/C agent already does for their clients. The life advisor must be able to work within the P/C agent’s company culture. The P/C agent must be sure that the life advisor is competent to present solutions to the P/C clients. These issues must be addressed and confidence must be established before implementing a cross-selling plan. Whether a P/C agent engages with a life insurance advisory firm or hires their own independent life producer, it is critical that all parties understand the P/C agent’s company culture. If you decide that working with a P/C agent to build a new revenue model is important to your practice’s future, the new business model should get the same attention and concern as your core business. It should never be treated as a hobby.

UNDERSTANDING THE DIFFERENCES: PARTNERING WITH P/C AGENTS LIFE with specific problems and unique solutions designed specifically for them. In addition, this focused approach not only educates the P/C agent’s client, but also allows you to improve your implementation of client-specific strategies. Clients also may be ranked according to earnings, creditworthiness or size. This all depends on the information you have available.

Both the life agent and the P/C agent should define the rules of engagement.

Creating a Successful Partnership

Life insurance advisors and P/C advisors have unique skill sets and approaches to selling insurance. Unlike the P/C sale, leading with product and price never leads to a life sale. Unless mandated by a bank, divorce decree or some other directive, a life insurance purchase is a voluntary one. As a result, agents will not find success in pushing product without exposing the need. The following suggestions will provide some guidance on how to create a meaningful life revenue model.

1. Create dynamic customer profiles.

The first step in the life and P/C agent partnership is to build dynamic customer profiles for the P/C agent’s new and existing customers. These profiles are the cornerstone for engaging clients in a meaningful way. Information needed from the P/C agent’s new and existing customers includes:

» Type of entity. » Number/ages of owners. » Gross revenue. » Current income.

3. Create/manage a plan. Now that you

» Personal real estate holdings. » Inventory of in-force life, disability and

long-term care insurance (business and personal).

» Copies of wills and trusts. » Copies of buy/sell agreements. » Family information (married, divorced, remarried, children, grandchildren).


» Advisors’ names (CPA, attorney). 2. Identify opportunity. With the P/C

agent, categorize the P/C agent’s clients (partnerships, C corporations, limited liability corporations, etc.) and organize them for identification. Once you have this information organized, you can begin discussions about a particular group and work together to build a plan to identify strategies that can help those types of business owners. The life agent should be looking at how the P/C agent engages the client and should discuss how they may approach the client in a meaningful way. Look at “case study” email campaigns. These campaigns should target specific client types,

have decided to make this happen, it is time to build the business plan and establish roles and responsibilities. First, identify a P/C firm you wish to partner with. Next, build a business plan consistent with your current company culture and a compensation model proportionate to the work provided. The compensation model should be created in a manner that incentivizes the behaviors you need from all parties involved. The P/C firm should compile a list of one group of clients to approach first. After that, a designated number of clients should be approached over the next 12 months. In preparing to approach clients, be sure to create your content, method of communication and engagement process. Don’t forget to communicate the broader message with your staff. Both the life agent and the P/C agent should define the rules of engagement. Hold regular sales meetings where you share successes and deconstruct losses. Create a process for dispute resolution over compensation, communication and overall client engagement. This information is simply a starting point. Each firm is unique and should adjust according to market conditions, client profiles and staff limitations. When you begin working with P/C agents or firms, I recommend both parties complete a feasibility study. Come up with an overview of services provided and a revenue forecast based on a sample of client analytics. Appropriate vetting of the agent or firm you partner with will serve you well. Dan Stanley is chief underwriter, IPS Advisors, Dallas. Dan may be contacted at dan.

March 2018 » InsuranceNewsNet Magazine



Bill Would Open Door to Annuities in Employer Plans


Lawmakers want to help employers offer annuities in their retirement plans. The Increasing Access to a Secure Retirement Act was introduced in Congress by Reps. Tim Walberg, R-Mich., and Lisa Blunt Rochester, D-Del. The bill would ensure employers abide by their fiduciary duty when offering products with guaranteed lifetime income in their retirement plans. In addition, the bill would require employers to conduct a thorough search for insurers financially capable of meeting their obligations and ensure the products’ relative costs are reasonable. The proposed legislation would not require employers to choose the lowestpriced products, but they would be required to conduct periodic reviews.


Morgan Stanley and an advisor who was its employee won a lawsuit filed against them by three annuity beneficiaries over their disbursement options. The beneficiaries claimed that as a result of the advice, they cashed out their annuities in a lump-sum payout that caused them to take a tax hit of nearly $300,000. Judge Paula Xinis of the U.S. District Court for the District of Maryland said the financial advisor, who was a Morgan Stanley employee, breached his duty because he didn’t research the beneficiaries’ disbursement options and advise them accordingly. But Morgan Stanley and the advisor ultimately weren’t liable because the beneficiaries themselves were negligent in failing to read the annuity forms or obtain independent tax advice before opting to get their benefits in a lump-sum distribution, Xinis said in her decision. DID YOU




The beneficiaries who filed the lawsuit weren’t exactly novices when it came to annuities. According to the judge’s decision, the beneficiaries had years of prior experience with annuities and access to documents and contracts, which expressly described their distribution options in addition to the lump-sum distribution. One of the beneficiaries even admitted that if he had contacted the annuity companies or consulted his other financial and tax advisors, he would have learned of the other disbursement options, and that failing to do so was imprudent, Xinis said.


Carriers have been busy bringing new annuity products into the marketplace. Here’s a rundown on some of them. Prudential has launched the PruSecure Fixed Indexed Annuity. This is a single-premium, long-term protection solution that earns interest based on stock market performance and/or a fixed rate, with zero exposure to market downturns. Security Benefit Life has introduced a version of its RateTrack floating-rate annuity that adds a lifetime income benefit. The

There aredon’t 11 companies People want offering to QLAC (qualifying longevity annuity lock in for fear that rates contract) products. While this is won’t move. a small and new part of the DIA market, we expect to see an uptick — Douglas Wolff, CEO of Security Benefit Life in sales in 2016.

launch of the RateTrack Plus Annuity comes nearly two years after the carrier debuted RateTrack, a floating-rate fixed annuity. Insurance agents and financial advisors with clients living in New York can offer those clients a new annuity from AIG. Assured Edge Income Builder-NY is the first fixed annuity with a guaranteed lifetime withdrawal benefit offered in New York.


What are investors doing with the premium they put into annuities? Using it for income, of course! LIMRA research found that half of the money ($84.5 billion) invested in annuities in 2016 was used to purchase products that offer guaranteed income — either immediately or for the future. The research identified annuity buyers having one of three investment objectives when purchasing an annuity: market accumulation, principal preservation or creation of guaranteed income. In addition to those seeking guaranteed income, more than a third of the 2016 annuity premium was invested in annuities that provide principal preservation with growth opportunity, and 15 percent went toward market accumulation products. Yet a booming equities market may be shifting buyers’ priorities. In 2016, annuities purchased with an investment goal of principal preservation and growth rose 17 percent, compared with 2015 ($52.1 billion to $58.7 billion). In contrast, new premium received in guaranteed income for later investment objective declined 16 percent from $89.8 billion in 2015 to $75.3 billion in 2016.

Owning an annuity is not enough to improve retirement confidence, unless that annuity is part of a formal retirement plan, researchers say. Source: LIMRA

InsuranceNewsNet Magazine » March 2018

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Wealthy Take A Shine To QLACs High-net-worth individuals are finding that investing in this type of annuity gives them protection against longevity while cutting taxes. By Cyril Tuohy


obert Klein has sold his fair share of qualified longevity annuity contracts (QLACs) over the past three-and-a-half years, and every sale has been to a high-networth client. “The primary purpose of each sale has been to provide sustainable lifetime income later in life,” said Klein. He is the founder and president of Retirement Income Center, a registered investment advisory in Newport Beach, one of Southern California’s wealthiest enclaves. Klein said he has been bringing up the subject of QLACs more frequently; and he has seen an uptick in interest in QLACs, a special kind of deferred income annuity (DIA). He’s not alone. Nearly four years after the U.S. Treasury Department authorized QLACs for the 401(k) and the individual retirement account (IRA) markets to help workers save for retirement, advisors seem to be expressing a warming curiosity about DIAs, according to quotation data. Last year, 34.8 percent of income annuity quotes were for income annuities with a start date of 13 months or more, according to CANNEX USA, an annuity quotation tracking service. In 2016, an estimated 32.1 percent of income annuity quotes were for DIAs with a start date of 13 months or more. Contrast that with the previous year, when only 28.3 percent of quotes were for DIAs with a start date of 13 months or more, CANNEX USA reported.


QLACs Larger Than Income Annuities

When Treasury Department officials authorized the launch of QLACs in July 2014, the idea was to give middle-market buyers an incentive to create their own pension by moving a portion of their retirement assets into a product they could never outlive. That may be happening, annuity experts say, especially since consumers can

fund a QLAC in installments prior to retirement, similar to the way they fund a 401(k). “But there’s a second application that’s emerged and that is with the high-networth [segment] — that’s what I hear from some of our clients with regard to the increase in QLAC quotes,” said Gary Baker, CANNEX president and CEO. The average size of QLAC policies sold to date tends to be larger than that of regular income annuities in general. This is a sign that annuity specialists are using QLACs to develop tax strategies, he added. Maximum premium contributions

InsuranceNewsNet Magazine » March 2018

into a QLAC for 2018 are set at $130,000, slightly higher than the $125,000 limit allowed in 2017. Meanwhile, average premiums for traditional single-life income annuities hover in the $90,000-$100,000 range, depending on the distribution channel, Baker said. The amount of deferred income annuity quotes continues to grow at CANNEX USA. But, Baker said, QLAC searches now are beginning to increase in the retail advisor channel compared with the traditional direct and rollover channels for these products. Recent quoting activity aside, DIA sales for now still represent a tiny sliver of the fixed annuity market, which sold $25 billion worth of fixed annuities in the third quarter. Third-quarter DIA sales fell 14 percent to $520 million compared with the year-ago period, according to LIMRA Secure Retirement Institute. For DIA sales to take off, they would need a boost from more buyers in the vast middle market. However, QLACs are not an easy sell because those buyers tend to be skittish about putting large amounts of retirement capital into a product to which they don’t have immediate access. Tying up 25 percent of a $200,000 retirement portfolio means $50,000 is unavailable for emergencies, capital inaccessible to replace a lost pension or to provide an income floor should something happen to Social Security, said financial planner Sandra Adams. For a middle-market buyer, “They say, that’s too much risk for me,” said Adams, a partner with the Center for Financial Planning in Southfield, Mich.

Taxes, RMDs and Deferrals

Buyers with retirement assets in the $500,000 to $2 million range, also known as the emerging affluent, are key prospects

WEALTHY TAKE A SHINE TO QLACS ANNUITY for QLACs. Investing in a QLAC with anything much less than the $130,000 maximum, however, doesn’t generate enough lifetime income, advisors say. QLACs offer several advantages to those for whom $130,000 isn’t going to break the bank. QLACs can cut taxes by reducing the required minimum distribution (RMD), said Alexander Koury, a financial advisor with ValuesQuest in Phoenix. A $1 million IRA could easily fund a $130,000 QLAC. With $130,000 “off the table,” the new RMD would be calculated on $870,000 as QLACs are excluded from RMDs since they have no cash value. Many retirees today already have income guarantees thanks to Social Security, pensions and even other annuities. Those income streams should provide more than enough income, so the RMD is forcing retirees at the age of 70.5 to take income they don’t need, money taxed at higher marginal tax rates, Koury said. QLAC income streams become taxable at a future date. If the retiree passes away

before taking income, the principal is returned to the beneficiaries. High-net-worth buyers don’t need to solve for income as much as they need to solve for longevity. So investing $130,000 to help fund life expectancy to the age of 95 or older, at a time when interest rates are back on the rise, is why wealthy buyers are interested in QLACs, advisors say. Other advisors, such as Klein, say the fixed payments issued by QLACs make it easier for retirees to plan and budget for medical expenses, prescription drugs and long-term care. Fluctuating RMDs make it difficult to project annual withdrawal amounts compared with projected retirement income needs, he said. At the end of the day, mass affluent and wealthy retirees collecting Social Security and lucky enough to benefit from a pension don’t sweat market swings, don’t obsess over return on investment, and rarely lose sleep over basis points of rising and falling interest rates. Grandparents would prefer doting on their grandchildren who are running

around the baseball diamond or performing in a dance recital. Deferring the RMD — which QLAC owners can do as late as age 85 — isn’t nearly as exciting as generating dependable income, especially if buyers give their QLAC time to grow, Klein said. People say setting aside $130,000 in a QLAC isn’t that much to begin with, but it depends on when you buy it and the number of years of deferral, he said. “If you buy it in your late 40s and defer until you are 80, you can get a sizeable income,” Klein said. InsuranceNewsNet Senior Writer Cyril Tuohy has covered the financial services industry for more than 15 years. Cyril may be reached at

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FIA Marketing Shifts to Accumulation The question is how and when the tide shifts between marketing an annuity for accumulation, as agents seem to be doing now, and marketing an annuity for income, as agents are likely to do again in the future. By Cyril Tuohy


n the fixed indexed annuity market, the buzz around accumulation continues to get louder. “Independent agents continued to shift their emphasis from guaranteed income to accumulation products focused on upside potential,” said John Matovina, CEO of American Equity Investment Life, one of the nation’s largest sellers of indexed annuities. “We addressed this shift by placing more emphasis in our marketing efforts on our Choice Series at American Equity Life,” Matovina told analysts. “The Choice Series accounted for 22 percent of American Equity Life’s sales in the third quarter of 2017 versus 17 percent in the second quarter.” Why the shift in emphasis by agents?

Volatility Indexes Part of Conversation

Volatility control indexes have offered agents an opening to talk about higher returns and better accumulation, according to industry experts. Participation rates and spreads on volatility control indexes are considerably more attractive than those offered on plain vanilla indexes like the Standard & Poor’s 500 index, said Sheryl J. Moore, president and CEO of Moore Market Intelligence and Wink Inc. Volatility control indexes, as the very name suggests, smooth out the highs and lows of the market to earn a more consistent return. While the jury is still out on whether these newer indexes will return more interest than the indexes used over the past 20 years, they are anticipated to return interest more consistently. So instead of traditional indexes, where a contract holder typically may earn 0 34

percent one year and 6 percent the next, volatility control indexes give the contract holder a greater likelihood of earning 3 percent one year and 3 percent the next. While the opportunity for unlimited gain may be true theoretically, unlimited gains aren’t realistic. This is because indexed annuities themselves are self-limiting. Indexed annuities prevent buyers from losing principal, therefore limiting loss. But indexed annuities also limit gains by imposing caps, reining in participation rates and assigning assets to specific allocations.

A LIMRA study identified annuity buyers as having one of three investment objectives when purchasing an annuity ... 1. Market accumulation. 2. Principal preservation. 3. Creation of guaranteed income. From an agent perspective, talking about higher potential for returns — upside potential — is a more compelling story than talking about caps when interest rates are still relatively low.

GLWBs a More Complicated Sell

The focus on the accumulation potential of indexed annuities also is taking place because the guaranteed lifetime withdrawal benefit (GLWB) story has become more complicated, experts said. Shortly after GLWBs were launched for indexed annuities in 2006, interest rates dropped. Agents selling indexed annuities switched from emphasizing the cap rates on the annuity to emphasizing the roll-up rate on the lifetime withdrawal benefit rider. “People were saying, ‘I can’t sell a 4 percent cap on an indexed annuity, but I can sell a 7 percent roll-up on a GLWB rider,’ so several years ago we saw the focus switch from accumulation to income,” Moore said. But now the tables have turned. After indexed annuity sellers entered

InsuranceNewsNet Magazine » March 2018

an arms race with roll-up rates as high as 7.5 or 8 percent, GLWBs became commoditized and “spread sheeted.” Ultimately, roll-up rates became harder to price. In lieu of offering roll-ups, companies have switched to increasing their benefit base value through other methods, such as crediting that value with any fixed or indexed interest earned on the annuity. While this may provide no less value, it is more difficult to “guarantee X percent” without a roll-up. As a result, the income story gradually ceded ground to the accumulation story.

Delay Taking Income

Buyers prefer to lock in equity gains, protect their principal and delay taking income, said Brian Kroll, head of annuities solutions for Lincoln Financial. “This shift [to accumulation] is being driven by our clients’ demands,” Kroll said. Every deferred annuity is sold with income and accumulation potential, but depending on the direction of other variables in the market, agents may want to stress a different feature of the indexed annuity.” The question is how and when the tide shifts between marketing an annuity for accumulation, as agents seem to be doing now, and marketing an annuity for income, as agents did several years ago and are likely to do again in the future. For advisors, the fact remains that Americans are terrified of running out of money in retirement. For the moment, pre-retirees and retirees may be more concerned with accumulation at a time of seemingly impregnable stock market increases and low interest rates. But for insurers and distributors, it’s only a matter of time before the conversation around indexed annuities shifts back toward income. InsuranceNewsNet Senior Writer Cyril Tuohy has covered the financial services industry for more than 15 years. Cyril may be reached at cyril.



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March 2018 » InsuranceNewsNet Magazine



ACA Repeal Is Dead After last year’s failed effort to repeal the Affordable

Care Act (ACA), Republicans in both houses of Congress appear to be throwing in the towel on making another repeal effort in 2018. At a Republican congressional retreat in February, GOP leaders in both the House and Senate indicated the votes to get rid of the health care bill just aren’t there. With an ACA repeal unlikely this year, Congress is turning its sights to stabilizing the marketplace. Top House Republicans are said to be interested in funding reinsurance. The money could be included in a bipartisan government funding deal or in another legislative vehicle. Rep. Ryan Costello, R-Pa., is sponsoring a bill to provide ACA stability funding in 2019 and 2020. Another attempt to stabilize the ACA marketplace is the Alexander-Murray Bill. The bill, sponsored by Sen. Lamar Alexander, R-Tenn., and Sen. Patty Murray, D-Wash., would fund cost-sharing reductions to insurers for giving discounts to low-income enrollees. Whether the project will expand beyond the three companies that are creating it is unknown.


What do Amazon, Berkshire Hathaway and JPMorgan Chase have in common? In a word, “disruption” — particularly in employee health care. Leaders of these three corporations announced they will team up to create a company that will help their workers find health care at what they call “a reasonable cost.” Details of the plan are vague at this point, but the corporate bigwigs behind it say the new venture will be independent and “free from profit-making incentives and constraints,” and its initial focus will be on technology. DID YOU




Idaho is blazing a trail away from ACA compliance. The Gem State is believed to be the first state to be making plans to allow insurance companies to sell cheap policies that ditch key provisions of the ACA. Idaho Department of Insurance Director Dean Cameron said the move is necessary to make cheaper plans available to more people. It’s a step that he said would keep the state’s individual health


The ballooning costs of [health care] act as a hungry tapeworm on the American economy. — Warren Buffett, Berkshire Hathaway CEO

insurance marketplace from collapsing as healthy residents choose to go uninsured rather than pay for expensive plans that comply with the federal law. The plan would make it possible for insurance companies to offer cheaper plans that might be more attractive to people who have to buy their own insurance and do not benefit from the ACA subsidies. The catch is that those plans might not cover pre-existing conditions, cap out-of-pocket expenses or comply with the ACA’s 10 essential benefits.


Mutual of Omaha is teaming up with Lumeris to enter the Medicare Advantage market. Lumeris is the operator of one of the country’s largest health plans founded by physicians. Beginning in 2019, Mutual and Lumeris plan to offer a Medicare Advantage plan with prescription drug coverage in select markets. The two companies are entering an area poised for growth. According to the Kaiser Family Foundation, one in three people with Medicare is currently enrolled in a Medicare Advantage plan, and by 2027 that number is expected to climb to 41 percent.

Asthma costs the U.S. economy $80 billion annually. Source: : American Thoracic Society

InsuranceNewsNet Magazine » March 2018

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Examining generational differences confirms millennials’ interest extends beyond technology and they are looking for ways to improve their experience, generally. For instance, millennials are far more interested than boomers in consultations with a patient advocate and financial-planning services. They also are more interested in the opportunity to interact with or learn from patients who have similar conditions.


Millennials Demand Benefits But Need Choices, Clarity The best ways to determine what types of benefits millennials want and how to communicate with them about those benefits.

Millennials are interested in By Christy DeFrain both high-tech great deal has been andof attention high-touch devoted to millennials in the last year or so. Millennials are offerings.


the largest generation in today’s workforce and certainly the most complicated. Employers and brokers aren’t the only ones trying to figure them out — so are recruiters, retailers and just about anyone for whom they are a target audience. Millennials are stereotyped in many ways. They are perceived as having a sense of entitlement, tied to their smartphones, selfie obsessed, job hoppers, digitally addicted and much more. Recruiting and keeping this generation isn’t about pampering them and “giving in.” Instead, it’s about understanding what motivates them, and addressing their differences. As for their employee benefits, millennials have low participation rates and are less likely to know about their employee benefits than other generations are. Millennials either aren’t aware of many of their benefit options, or are confused by those options — so they just don’t use them. How can our industry — specifically employers and brokers — be successful in presenting employee benefits thisWyman genCopyright © 2017to Oliver eration? To attract millennials, we must abandon one-size-fits-all benefits programs and one-size-fits-all, one-and-done methods of communicating about those benefits.

Benefits Millennials Want

The benefits and perks that employees truly care about are those that offer greater flexibility and autonomy as well as provide the ability to lead a better life. Millennials want benefits and perks that directly impact their lives and the lives of their family members, and they show a greater willingness to switch jobs to secure 38

Taken together, millennials’ responses indicate that they expect to engage with the healthcare system in a routine, potentially pleasing way, rather than only during crisis. As example, more than half of millennials want retail clinics and access to alternative services like massage. These are not traditional sick-care services, but rather health and wellness services that can be incorporated into everyday life. This expectation could explain why millennials are more concerned with quality than their older counterparts, who are more wedded to the sick-care model and just want it delivered as cheaply as possible. (More than 40 percent of millennials have at least one quality or access concern; in contrast, just 28 these elements, according to Gallup’s State Further, social support matters to percent of boomers have those concerns.)

of the Workplace Report. millennials just as much as technology In fact, a surprising number of millennidoes, as millennial respondents ranked The survey findings shed light on the reality that millennials don’t simply want today’s als will change jobs for a particular bene- the desire for an in-person consultation legacy healthcare experience delivered through an iPhone screen. They see technology as fit or perk. A 2017 Anthem Life Insurance with a patient advocate expert the same a way to deliver that convenience; but theyworkalso seekas guidance and they the opportunity survey revealed 1 in 3 millennial they ranked thewant desire for wearables to interact with patients like them. A healthcare organization that delivers these services ers has turned down a job offer due to that monitor their health and wellness. will develop much deeper relationships with millennial consumers than those that focus insufficient or lackluster health insurance. More than half (55 percent) of millenniSo what benefits are important to als surveyed in that study said their most exclusively on the technology channel as an end in itself. millennials? desired health care offering is to obtain WHAT CONSUMERS ARE WILLING TO PAY FOR VARIES bY GENERATION Highest-rated new offering, by percentage of respondents




Guaranteed appointments with a specialist within a week

Same-day appointments with a family doctor

Home visits from a healthcare professional, such as a doctor or nurse




Source: Oliver Wyman and Fortune Knowledge Group analysis

» As millennials age, the more traditional

benefits become increasingly important to them. In addition, millennials want more than the usual benefit mix of medical, vision and dental coverage. As more millennials begin to get married, purchase homes and start families, they slowly are warming to the idea of disability coverage.

» Millennials expect a broader range of

health care services than is offered to them currently. They are not opposed to paying for high-tech and high-touch health care experiences, such as an on-camera visit with a doctor or an app that enables a consultation with specialists, according to an Oliver Wyman study.

InsuranceNewsNet Magazine » March 2018

guaranteed appointments with a specialist within a week. 10

» Being an “on-demand” generation, mil-

lennials have an affinity for being offered lots of options and being able to choose what they want. This certainly applies to their employee benefits as well. By offering a variety of voluntary benefits, employers can provide a means for millennials to customize their benefits package, choosing options that are important to them. Among the voluntary benefits that appeal to millennials are identity theft protection, critical illness insurance, student loan repayment programs, pet insurance and employee purchase programs.


that most millennials carry, it’s no wonder that student loan repayment programs are a powerful incentive for their recruitment and retention, yet only 4 percent of employers offer this assistance, according to the Society for Human Resource Management (SHRM).

35% of millennials have turned down a job offer because they were dissatisfied with insurance offerings, compared with 27 percent of U.S. workers overall. Source: 2017 Anthem Life Insurance survey

52% of employers surveyed have implemented or are considering implementing a financial wellness program as part of a comprehensive workplace benefits and compensation package.

» Of all the generations, millennials are the

most amenable to participating in financial education programs. SHRM reported that 92 percent of millennial employees surveyed said they would use such a wellness program at work if offered one. This presents a great opportunity for employers and for brokers to bring to their attention. Although financial wellness programs have not yet reached the level of penetration of other long-standing benefit offerings, a Charles Schwab study showed that 52 percent of employers have implemented or are considering implementing a financial wellness program, and 44 percent believe that a financial wellness program is becoming a “must-have” benefit in order to be competitive. In addition to financial education programs on budgeting, debt management, buying a home and starting a savings plan, benefits such as employee purchase programs and employee discount programs help millennials access products and services they need and want in a more financially disciplined manner.

Communicate to Engage Millennials

Because participation in employee benefit programs is generally lower among millennials than other age groups, employers and brokers must use benefits communications methods that appeal to millennials. It’s also important to communicate frequently with millennials throughout the year, not just during open enrollment time. Tailoring communication messages specifically for millennials involves providing information in bite-sized portions. Plus, millennials need more than information — they need to see the value. Offering an explanation or illustration on why a particular benefit matters and how it will help them now or in the future goes a long way toward showing the value to millennials. In addition, providing total compensation statements can increase millennials’

Source: Charles Schwab study

benefit usage by creating a clear understanding of the package value. Millennials won’t pay much attention to some of the usual ways companies share benefit information, such as mass email and direct mail. Unlike other generations, for which “push” communications worked just fine, millennials want “pull” communications. And it’s no surprise that technology is the key to communicating benefits with millennials. They want access to information all the time, via mobile, techfriendly products that fit with their lifestyles. They want to self-service their benefits on their time and in their own way. Millennials also value personal conversation and content coming from familiar sources — such as managers and peers. Millennials will pay far more attention to communication from their peers and managers than they will from their company’s CEO or vice president of human resources.

Communications Their Way

Millennials have limited attention spans. Since they spend so much time on their smartphones, the best way to make an impact with benefits communications is to keep it simple and use methods that they can easily access on these devices. Here are five tips to getting your benefits message across to millennials:

1. Highlight benefits that make the most

sense for millennials, and provide the information in bite-sized portions. Lay out content so it is easily scannable.

information, give it to them in their daily social media platforms and feeds where they can quickly scan and click embedded links to a site where they can take action. Capture their attention via texts, ad tiles, banners and videos.

3. Personalize and humanize messages

as much as possible. Address millennials directly, using the word “you,” rather than in the third person. Include real-life benefit examples that allow millennials to better understand. Hearing from their peers can make an impact, so create a brief video of a millennial employee talking about a specific benefit.

4. When communicating benefits to mil-

lennials, highlight ease of use and digital mobility features. For example, many may not realize that some consumer-directed benefits, including health savings accounts and flexible spending accounts, can be easily managed by downloading an app.

5. Reach out to millennials using communication methods and technology that they use — such as text messages, gaming and videos. Christy DeFrain is vice president, sales and account management, at Purchasing Power, a voluntary benefit provider of an employee purchase program. Christy may be contacted at

2. Since millennials like bite-sized pieces of March 2018 » InsuranceNewsNet Magazine



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Retirement Savings Shaping Up

Some good news on the state of Americans’ retirement savings: More of us are on track with our retirement savings goals than in a decade. That’s the word from Fidelity Investments, which reported the typical saver is on track 8.8% to have 80 percent of the income they’ll 2018 Typical retirement need to cover retirement costs. That’s the savings rate has highest score since Fidelity’s surveys began in 2005, when it was at 62 percent. 3.6% doubled since just In figuring how much Americans are 2006 a decade ago. saving for retirement, Fidelity considered how much people were saving in their 401(k) accounts, as well as their expected Social Security benefits and other assets. A surging stock market, as well as workers saving more of their pay each year, are the factors behind the improved retirement savings picture.


Banks are back on the RIA prowl. Banks bought 13 registered investment advisors (RIAs) last year, nearly three times the number of RIAs they bought in 2016. Lower tax rates signed into law at the end of 2017 could encourage banks to buy still more RIAs in 2018, a market analyst said. Banks, along with some private equity deals, were responsible for about 8 percent of the 153 RIA acquisitions last year, RIA Deal Book reported. Overall RIA acquisitions rose 6 percent last year over those in 2016.

Banks bought 13 RIAs in 2017, nearly three times higher than during 2016.





PASSION, NOT PROFIT, DRIVES COLLECTIBLE INVESTING You know those boxes full of vintage comic books or the cellars filled with fine wines that your clients have accumulated through the years? Chances are your clients never had them appraised, according to a UBS Wealth Management report. The report said 39 percent of collectibles investors don’t know the value of their collections. Why? Because most wealthy investors are driven by their passion for collecting and not by any possible financial gain, the UBS report concluded. In addition, many collectors “do not even know the full value of their collections nor have had them insured,” UBS reported. Even though some collections may be worth big bucks, investors may find their treasured items aren’t worth much in the eyes of their heirs. The report said that

78 percent of registered investment advisors expect their firm’s assets under management to rise in 2018.

InsuranceNewsNet Magazine » March 2018

Source: LIMRA

Source: TD Ameritrade

What I’m worried about in 2018 is the lack of fear that I have and so many others have. — Jason Furman, former White House chief economist under President Barack Obama

although 81 percent of collectors intend to leave their collections to heirs, only 35 percent of heirs were interested in the collection and intended to keep it.

ADVISORS GROWING WARY OF TAMPS Assets in turnkey asset management programs (TAMPs) have grown significantly in recent years, but new investment options threaten to put an end to the party. With new asset allocation models and robotics-themed portfolio tools, analysts are debating whether there is still a viable place for third-party, turnkey asset management programs at investment advisory firms. But although advisors warmed up to third-party TAMPs, and enjoyed the increased free time they had to focus on their clients, growth has leveled off in the past year, according to Tiburon Strategic Advisors. That’s primarily due to fintech-themed alternative products like robo-advisory services, which increasingly handle traditional trading and managing of client investments that back offices used to own.

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How to Reach the Emerging Millionaires Next Door Serving the growing emerging high-net-worth market can help build a foundation for your firm’s future growth. • Craig Hawley


he emerging high-net-worth market in the United States is thriving and poised for greater growth. With investable assets ranging between $500,000 and $1 million, the emerging high-net-worth segment represents roughly 12 million households — close to 10 percent of all households. As members of this group focused on building more wealth, their average net worth increased by 23 percent from 2013 to 2016, making them one of the fastestgrowing net-worth segments, according to Federal Reserve data. In our Advisor Authority special report, we focused on the emerging high-net-worth consumers to help advisors at every level move the needle for their practices, enhance their current profitability and build a foundation for their firms’ future growth.

Future Millionaires

Today’s emerging high-net-worth individuals are poised to be the future “millionaires next door.” The United States continues to be home to the largest number of millionaires — and the number continues to increase. According to global consultancy firm Capgemini, the number of 42 42

high-net-worth and ultra-high-net-worth individuals with investable assets of $1 million or more has grown to 4.8 million people in 2016. This represents a 7.6 percent increase from 4.5 million in 2015, and nearly double from 2.5 million in 2008. According to Credit Suisse, the United States accounts for 41 percent of the world’s millionaires, has six times more ultra-high-net-worth individuals than the next closest country, and has the highest number of individuals in the top 1 percent global wealth group. Clearly, the opportunity for advisors is huge.

Preferences, Priorities and Concerns

Advisors have an opportunity to target this valuable segment of emerging high-networth investors by understanding their top preferences, priorities and concerns now — and how these will shift as they accumulate more wealth. What keeps the emerging high-net-worth and other affluent clients up at night — and how can advisors better align to provide the right solutions? An optimistic outlook: The future is bright. Emerging high-net-worth investors say their financial outlook is more

InsuranceNewsNet Magazine Magazine »» March March 2018 2018 InsuranceNewsNet

Hidey- ho neighbor!

optimistic than many wealth segments — and year over year, this percentage has increased, to 63 percent who said they were optimistic in 2017 from 47 percent in 2016. Creating confidence is key: Roughly two-thirds (64 percent) of emerging highnet-worth investors have an advisor — and the primary reason by a wide margin is to feel more confident in their financial future (43 percent), with concerns about saving enough for retirement (11 percent) at a distant second. Protecting assets is a top concern: When asked to rate their top three financial concerns, emerging high-net-worth investors said protecting assets was No. 1 at 43 percent in 2017. The cost of health care was rated second in 2017 at 30 percent. Focused on their bottom lines and their portfolios, taxes were rated third in 2017. Washington politics affect investing: Washington politics (34 percent) was rated the No. 1 trend in 2017 that will impact the investing approach of emerging high-networth investors. Concern about domestic economic performance (30 percent) was rated second, Federal Reserve policy (29 percent) was rated third and changes to the tax code (25 percent) was rated fourth. Access and responsiveness are

their Emerging HNW and affluentimpact investors inapproach their practice, should be sure to address t Many advisors say U.S. Fed clients, Policy (32%) willthe haveother the number-one on their to investingadvisors in 2017. But to help reassure their Emerging politics HNW clients, the other gridlock affluent investors their practice,investing advisors should be sure towith address the clients. impact of An increased focu Washington andandongoing whenindiscussing strategies their Washington politics and ongoing gridlock when discussing investing strategies with their clients. An increased focus on tax-efficient HOW TOfor REACH THE affluent EMERGING MILLIONAIRES NEXTasDOOR investing would also be beneficial their more clients—and their practice well. investing would also be beneficial for their more affluent clients—and their practice as well. TOP TRENDS THAT WILL IMPACT INVESTING OVER THE NEXT 12 MONTHS TOP TRENDS THAT WILL IMPACT INVESTING OVER THE NEXT 12 MONTHS Emerging HNW


Emerging 36% HNW


Washington politics Domestic economic performance



US Fed policy (e.g. interest rates, monetary policy)



Washington politics

Changes to the tax code

Domestic Low returns oneconomic investments US Fed policy (e.g.


30% 21%

performance 23%

Ongoing volatility interest rates, monetary

20% policy)

17% Changes to the tax code


Instability in Chinese Social market discord

volatility 13%






in6%the U.S.

13% 3%


4% International economic performance






Threat of terrorism



Regulatory changes (such as the DOL fiduciary standard)


Instability in Chinese market





9% 7%









23 17%







6% 7%










12% 3%





















3% 9%











Geopolitical tension None

*Coded Responses less than 2% not displayed











Instability in European markets Monetary policies abroad

20% 18%

23% 9%

Geopolitical tension 12% Energy prices (e.g., oil, gas, etc.) Threat of terrorism



returns on investments SocialLow discord in the U.S. 13%

Regulatory changes (such as the DOL fiduciary standard)





All Inve


24% 28%


All Advisors

Ultra HNW 33%

20% 34%



International economic performance Ongoing

HNW 30%

16% 29%

Energy prices (e.g., oil, gas, etc.)

All Investors

Ultra HNW


Source: ADVISOR AUTHORITY 2017: The Future of Advice 7%




important: Emerging high-net-worth percent in 2017 from 24 percent in 2016). attribute that is most important to them Instability in European markets 7% 9% 5% 4% and other affluent investors value access But to better align with emerging high- in their relationships with their advisors. Monetary policies abroad 1% 5% 7% 5% and responsiveness. When asked to se- net-worth investors, advisors should also Advisors also say trust comes first (44 None "It’s about a very deep sense of purpose to makethat a difference to truly an impact. 10% 11%prioritize good com7% 7% lect their preferred formhaving of communicaprioritize solutions can helpand these cli- make percent), and Again, they understand what's really important to your client and remember, they aretaxes. your top munication priority." tion with an advisor, emerging high-netents 1) protect assets and 2) manage (11 percent) and good listen*Codedinvestors Responses lessphone than 2% notfirst displayed worth rate calls (40 Likewise, many advisors say U.S. Fed ing skills (9 percent) as important attripercent) and face-to-face meetings a very policy (32 percent) will have the most butes of the advisor/investor relationship. Paul A. Pagnato, Founder and CEO, close second (39 percent). impact on their approach to investing in However, when working with the emergExperience,PagnatoKarp fee-based fiduciary stan- 2017. But to help reassure their emerg- ing high-net-worth individuals, be aware dard and personalized holistic plan- ing high-net-worth clients and the other — and be prepared — to address your ning: When asked to select the top three affluent investors in their practices, advi- track record and your approach to adding factors that influence them to work with sors should be sure to address the impact greater value. "It’s about having a very deep sense of purpose to make a difference and to truly make an impact. Ag an advisor, these investors rate advisor ex- of Washington politics and ongoing gridThese investors look for a depth of reunderstand what's to your client strategies and remember, they are your priority." perience first (54 percent). Compared withreally lockimportant when discussing investing lationship and level of top engagement with other more affluent investors, the emerging with their clients. An increased focus on an experienced advisor who can provide high-net-worth place greater importance on tax-efficient investing would be beneficial greater value and can put their clients’ Paul A. Pagnato, Report a fee-based fiduciary standard, rating it sec- for their more affluent clients — and their bestAdvisor interestsAuthority first. These affluent investors Founder and CEO, ond (31 percent), followed by personalized practices as well. recognize and see greater value in guided PagnatoKarp holistic planning, rating it third (22 percent). When targeting these investors, less- advice. They appreciate transparency, high Relationships matter most to emerg- experienced advisors should consider value, low cost and more choice in their ing high net worth: These investors say partnering with more-experienced advi- products and services. personal one-on-one relationships matter sors within their firms and building mulAs we have seen year over year, regismost (52 percent) to a successful customer tigenerational teams. To be consistent tered investment advisors and fee-based experience, while quality of communica- with a fee-based fiduciary standard, all advisors rate the pursuit of profitability as tion comes second (38 percent). They are advisors should make greater transpar- their single most important practice manclear that products and strategies should ency and greater choice a top priority. To agement issue. The push for new clients, be transparent (26 percent), low-cost (25 provide more personalized and holistic such as the emerging high-net-worth marpercent), high-value (22 percent), and of- planning, consider partnerships with spe- ket, will be an important focus in order to fer more choice (17 percent) to contribute cialists such as CPAs, trust attorneys and drive success for their firms’ futures. Advisor Auth to the success of the customer experience. estate planners. Craig Hawley is head A personal one-on-one relationship is a Jefferson National, Aligning With Affluent Investors top priority for emerging high-net-worth of Nationwide’s advisory soluMany advisors say that saving enough for investors. And to ensure that these rela- tions business. Craig may be retirement (39 percent) is their clients’ top tionships will work, trust must come first. contacted at craig.hawley@ concern, and the cost of health care has In fact, trust is rated first by the emerg- increased in importance year over year (33 ing high-net-worth (44 percent) as the


March 2018 2018 »» InsuranceNewsNet InsuranceNewsNet Magazine Magazine March

43 43

Remembe happened r what wit tech bubbleh the …

Nudging Clients to Rebalance Their Retirement Portfolios Here is how a well-timed nudge from an advisor could save the day. • Brian O’Connell


mericans are way too lax on tracking their retirement investing portfolios, and that could cost them big time when that work paycheck stops hitting their bank accounts. This casual attitude toward retirement finances is likely playing a huge role in leaving many people unprepared to retire, a new study found. “Despite industrywide advice, investor portfolios remain stagnant, blindly unaware of all of the dollars they could be leaving on the table,” concluded the study by Wells Fargo and Gallup. “It is critical that investors begin to evaluate their portfolios and consider rebalancing. The current bull market, 44 44

which strategists believe to be overinflated, is predicted to correct in the near future.” This correction could leave some investors scrambling as they lose significant gains they made in the last three quarters. Here’s just how far rebalancing has fallen on investor priority lists, according to Wells Fargo: » Nearly 60 percent of investors feel that their financial situation would be hurt — moderately to a lot — if a major market correction were to occur. » Only 40 percent of investors plan to consider rebalancing by year’s end. » Less than half (48 percent) are consulting with a financial advisor. Roughly the same number (49 percent) would

InsuranceNewsNet Magazine Magazine »» March March 2018 2018 InsuranceNewsNet

consult with a professional financial advisor to help them through a market correction. “It’s noteworthy that investors say their financial situation would be hurt by a market correction and yet they’re still not highly prepared,” said Heather HuntRuddy, head of client experience and growth at Wells Fargo Advisors. “This underscores the need for professional financial advice or, at the least, a written investment plan and regular rebalancing of one’s portfolio.”

‘It Always Amazes Me’

Yet ask an investment advisor about rebalancing and you’ll likely hear a great deal on how much risk investors take when they don’t rebalance. “I’ve been working with retirement clients for the past 20 years, and it always


chosen by the client, is to use an investment platform that automates this process, Ryon said. “The client, with help from the advisor, will determine their risk profile and choose an appropriate investment model,” he noted. “These models can be made of individual securities, mutual funds, exchange-traded funds or a combination of investment vehicles.”

Diversification is often key when it comes to successful investing, but a recent Wells Fargo/Gallup poll finds that investors themselves are diverse in their approaches. Given four ways to describe their investing style, the majority of U.S. investors (55 percent) consider themselves “listeners” who know where to find good advice and usually follow it. Another 10 percent are self-proclaimed “pros” who do their own research and are confident in their abilities. Investors who take a more informal approach either describe themselves as “snoozers” who rarely look at their portfolios (24 percent) or as “instinctive investors” who say they mostly wing it (8 percent).

Automatic Rebalancing

Investors’ Descriptions of Their Overall Investing Styles Which of the following descriptions best matches your style as an investor?



A listener who knows where to get good advice, and usually follows it


A snoozer who hardly ever looks at your portfolio


A pro who does your own research and is confident in your abilities


An instinctive investor who mostly wings it


None/No opinion


Source: Wells Fargo/Gallup

amazes me that a 55- or 60-year-old retirement investor is still 100 percent in variables, like mutual funds and stocks, in their long-term investment portfolios,” said Meladee Rudolph, senior consultant at Stryde Savings, a financial advisory in Fenton, Mich. That’s one area where regular retirement portfolio rebalancing can help. “Portfolio rebalancing is a critical risk-mitigating strategy,” said Matthew S. Eads, portfolio manager at Eads & Heald Investment Counsel. “Good companies can turn into bad companies. Or, stocks [or industries] which have been outperforming can eventually turn sour.” A prime example of this is the tech bubble, Eads stated. “Tech stocks skyrocketed during the late 1990s and early 2000s,” he said. “Many people not only allowed their tech stocks to keep growing without trimming, but some also continued adding to those speculative positions.” How can advisors encourage investors to rebalance? By reminding them of how

many investors were whipsawed by the tech bubble bursting. “Many tech bubble investors ended up going back to work, often with a fraction of the savings they once had,” Eads said. “Had they been more apt to rebalance their outsized tech positions, they likely would not have suffered as badly.” When they do sit down with clients to revisit their investments, money managers should have their clients go back to basics to properly rebalance, and deploy effective technology tools, as needed. “The main purpose of rebalancing is to help maintain a client’s original risk objectives,” said William G. Ryon, managing partner at Compass Investment Advisors in Dover, Del. “It’s a way to buy low and sell high by selling off a portion of investments that have gains and reinvesting those proceeds into investments that may not have performed as well since the last rebalancing.” The simplest way for advisors to ensure clients rebalance on a regular basis, as

The models should allocate the client’s dollars, usually on a percentage basis, to predetermined investments. The system automatically rebalances and re-allocates any earnings across the portfolio, Ryon explained. “This prevents any one security from growing too large or small and ultimately changing the risk profile of the portfolio,” he added. It’s also worth noting that clients may not rebalance regularly for a number of reasons — most of them valid in the investor’s busy mind. “In our experience, clients simply do not know what it is until we educate them about it,” Ryon said. “This is where an automated platform can help, because the client will see their portfolio’s structure and performance over time and, as an advisor, I can remind them of what’s happening and its importance to the overall investment plan.” If a client has never rebalanced, the best thing to do is to perform a complete review of the client’s goals, objectives and risks, make any plan adjustments and model the investments to meet the updated objectives, Ryon said. “When implemented, the portfolio will be rebalanced and future rebalancing can be automated or otherwise scheduled,” he said. “It’s really all about education from the advisor.” Brian O’Connell is a former Wall Street bond trader and author of the best-selling books The 401k Millionaire and CNBC’s Guide to Creating Wealth. He’s a regular contributor to major media business platforms. Brian may be contacted at

March 2018 2018 »» InsuranceNewsNet InsuranceNewsNet Magazine Magazine March

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Boosters and Reducers: Curing Your Negative Self-Talk So much of our success or failure hinges on the messages we tell ourselves. Here is how to quell those negative voices in our heads. By Jack Singer


o you consistently unlock the champion performer that lies within you? Are you always able to perform your best when it matters the most? Can you bring your A game to your sales opportunities? The answer to these three questions represents the degree to which you engage your “performance intelligence.” These are the same questions that I have helped world champion and Olympic athletes answer for the past 33 years, and now I am helping insurance advisors answer them. The keys to success are identical. Every one of you is gifted. However, most of you have not unwrapped your gifts because they are buried under layers of self-doubt, lack of self-confidence or fear of failing. My intent is to show you how to tear away these negative psychological layers, to reveal your true potential and help you flourish.

Performance IQ Reducer No. 1: Being trapped in toxic self-talk

Mental health professionals now understand that the stress you experience does not come from adverse, disrupting events that take place in your job, such as the impact of the Department of Labor fiduciary standard, dealing with toxic and demanding clients, or your competition. Whether such circumstances actually cause stress is strictly based on the conversations you have with yourself about those instances. These conversations are based on belief patterns that have been ingrained in your mind for years. Unfortunately, many of us are taught problematic belief patterns by 46

well-meaning parents and other key influencers. Such beliefs always lead to outof-kilter, stressful reactions. For example:

» “If I’m not perfect, I consider myself a failure.”

» “My goal is to always please people,

even if I sacrifice what I want, because I need to be liked.”

» “I should avoid confrontations with my

clients, not assert myself, never take risks and always fly under the radar.” I refer to these kinds of beliefs as “linguistic toxicity.” They always lead to stress-related emotions, such as anxiety, tension, anger, frustration, depression, hopelessness and helplessness.

Performance IQ Booster No. 1: Recognize and reframe your toxic self-talk Peak Performance = Talent + Knowledge + Experience minus Distractions As insurance professionals, you may have the knowledge, the experience and

InsuranceNewsNet Magazine » March 2018

the talent to perform well in your profession. However, the key determinant of whether you maximize peak performance and minimize stress is whether you can recognize and eliminate the distractions (i.e., negative self-talk habits) that knock you down. Put simply, your goal is to recognize thought patterns that trigger stress reactions and how to stop them quickly. You want to move from “linguistic toxicity” to “linguistic nutrition.” Here is an example of a five-step process to deal with this major cause of stress.

1. Recognize a stress-triggering thought: “Will the DOL ruling negatively impact my career and my success?”

2. Have a wide (not tight) rubber band

on your wrist, and snap away to stop that thinking dead in its tracks.

3. Take a few deep, relaxing breaths: in

through your nose to the count of four, hold it for four, and out through your mouth to the count of seven.

4. Counterpunch that toxic thought with healthy, rational thoughts such as, “I can

BOOSTERS AND REDUCERS: CURING YOUR NEGATIVE SELF-TALK BUSINESS use my creative thinking to come up with proactive discussions with clients about how important fiduciary rules are for them and how I fully embrace the rules. I will continually be proud of my honorable career of protecting families from risk and giving them peace of mind.” 5. Anchor this healthy thinking by once again taking a few deep, relaxing breaths: in through your nose to the count of four, hold it for four, and out through your mouth to the count of seven.

Performance IQ Reducer No. 2: Using pessimistic explanations to yourself whenever you have a setback

How do you explain disappointing outcomes, such as a failed sales attempt, to yourself? How do you persevere and remain resilient under such adverse circumstances? Do you view such disappointments as overwhelming disasters or as manageable hurdles that can be overcome? These three questions form the essence of whether your “explanatory style” for adverse events and circumstances is

Pessimistic Explanatory Style

When a disappointing outcome takes place, pessimistically oriented people tend to blame themselves (internal cause), believe these events will continue to plague them (permanence), and see this situation as just another example of their inability to be successful (pervasive). Pessimistic thinkers believe these failures will continue to happen, feel helpless to do anything about it, and see this event as an example of their overall ineptitude. Pessimistically oriented folks do not take credit when they are successful. They explain this success in a negative way, such as, “That was a lucky break for me because the client was really in need of a product like this.” They see their success as a fluke, unlikely to repeat itself.

Performance IQ Booster No. 2: Whenever you experience disappointments, give yourself an optimistic explanation

Scientific research has found that, compared with pessimistically oriented life insurance professionals, optimistically

The good news is that you are not a prisoner of your past thinking. You are in charge of whether you will have optimistic or pessimistic self-talk after disappointing situations, and you can train yourself to change your thinking and expectations.

Performance IQ Reducer No. 3: Continuing your self-defeating habits

One of my biggest challenges with both athletes and insurance professionals is helping them develop and maintain new habits that will lead to maximized success. The key to maximizing your Performance IQ and permanently developing healthy thinking habits is what I call the “4-R” process.

Performance IQ Booster No. 3: Write down a 4-R plan for increasing your own performance IQ, and stick to it

Sample plan: (Write down these four steps and share them with a coworker, spouse, or friend as a partner to help you stick to them.)

1. “I will Recognize my toxic self-talk

habits and share them with my partner. Whenever I catch myself engaging in those self-defeating habits, I will immediately stop them, using the process described above.”

Pessimistically oriented folks do not take credit when they are successful. They explain this success in a negative way, such as, “That was a lucky break for me because the client was really in need of a product like this.”

2. “As part of the process, I will always Reframe toxic self-talk with nutritious self-talk, telling myself that there are always healthier explanations and descriptions of disappointments that I can give to myself.”

3. “As part of this process, I will Release optimistic or pessimistic. Your explanatory style represents one of the most powerful determinants of your job success or failure. Explanatory style is broken down into three components:

» Your perception of the cause of the unfortunate event or outcome.

» Your perception of the permanence of the unfortunate outcome in your view.

» How pervasive you view this outcome, relative to your overall abilities and skills.

oriented ones had half the burnout rates in their first year and made 37 percent more sales.

Optimistic Explanatory Style

When they are successful, optimistically oriented folks take full credit, believing, “Good things happen to me because of my work ethic and skills.” They believe good things will continue to happen to them for these reasons, and they see this outcome as an example of many areas of their lives where they have the skills and talent to be successful.

the negative energy of the past experience that can distract me from the positive energy of the present.”

4. “Whenever I recognize myself inter-

preting unfortunate events in a pessimistic way, I will Re-energize myself with optimistic self-talk.” Jack Singer is the author of The Financial Advisor’s Ultimate Stress Mastery Guide, and the president of He may be contacted at jack.

March 2018 » InsuranceNewsNet Magazine


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


Clients Come First – The Rest Takes Care of Itself Some advisors will need to make a difficult mental shift under the new fee-based structure and use client satisfaction and well-being as their motivation. By Rao Garuda


he financial services market shift from the product commission model toward fee-based consulting will test advisors’ capacity for survival and success. In order to thrive in the change, advisors must exhibit strength, smarts and adaptability. Much like Charles Darwin theorized that those who survive are the ones who are able to adapt and adjust to a changing environment, all three traits build off each other to help practices adapt and remain profitable without sacrificing quality for clients.

Smarts Come From Experience

Cultivate Strength To Endure Change

Selective Adaptability

The shift in pay structure is only one of several important factors shaping the financial services industry and advisors. In order to endure the pressure and succeed, advisors need emotional, ethical, and professional strength and personal resolve. This strength is built up by confidence. It stems from competence, professional experience and access to resources such as mentors and best-practices materials. Advisors must be prepared to let go of the industry’s fundamental structure. Some view commissions as a direct reward system to compensate them for hard work and results. Those advisors will need to make a difficult mental shift under the new structure and use client satisfaction and well-being as motivation. Advisors who have always operated under this principle will have no problem achieving success in the new structure. They understand the simple answer to financial success — the golden rule. It’s the belief that clients come first and the rest will take care of itself. 48

Advisors need to be smart in addition to intelligent in order to succeed. Smart means so much more than intelligent — it draws on experience, success and failure rather than education. Experience is more impactful because it flows from firsthand knowledge and is tied to the emotions of situations as well as the lessons learned. This includes the negative and positive feelings of trial and error — getting burned, seeing clients succeed, etc. — which are more effective and immediate instructors than a lecturer or an article. Without adaptability, advisors may exhaust their strength and smarts only to excel at obsolete tactics. The pay structure shift will be the first exercise in adaptability for American advisors. There is a worldwide movement away from commissions and toward fees. With this, we can look to other countries for insights and to set expectations. Once mandatory fees are a requirement in the U.S., advisors will do well to voluntarily charge a significant, but not prohibitive, fee for services and advice. The next step in mastering adaptability is less direct, but just as important — selecting when to change. Advisors must be able to refuse adaptation if it doesn’t make sense for them. Over the past three decades, the industry embraced technology with open arms as a tool to simplify operations. On the other hand, intrusive technologies that create electronic processes that used to be done manually open the door to advisor irrelevance and consumer reliance on doit-yourself technology. For example, computer-generated

InsuranceNewsNet Magazine » March 2018

algorithms drew us away from needs- and values-based client relationships. Rather, we focused on numerical projections based on our knowledge of the client and the market. If the numbers look good in the eyes of our client, they can elicit an emotional response almost as strong as those words and diagrams describing deeply held values once did. Impressive returns and numbers are an effective buying motivation. They are simpler and faster but easily replicated by machines. This automated, or robo-advisor, accessibility pushes advisors toward irrelevance and removes our indispensability. We can combat this by showing our clients how our knowledge and customization are indispensable when compared to a computer-generated algorithm. Fee-based advising is the latest in a long line of challenges advisors have had to overcome on the path to success. In order to remain indispensable to clients and avoid irrelevance, advisors must focus on clients’ well-being as an end goal. Nothing lasts forever in business, even indispensability. However, survival skills such as strength, smarts and adaptability will endure to ensure continued success. Keep up with your skills by learning best practices from fellow advisors and mentors. Rao Garuda, ChFC, CLU, is a 35-year MDRT member, with 24 Top of the Table and 24 Court of the Table qualifications. He is the author of several books, including The Meaning of Money: Creating Not Just Wealth on Your Balance Sheet But Significance in Your Life. Rao may be contacted at rao.


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.

What Top Producers Believe About Success Passion for helping clients achieve their financial goals will lead you to lasting relationships and a successful practice. By Thomas W. Young and Danny O’Connell


s we looked for ways to help you achieve success in 2018 and beyond, we decided to “pick the brains” of a few advisors who know a thing or two about success. Here is what a couple of them had to say.

Success Hinges on Passion Thomas W. Young

One of the most effective ways you can sustain a high level of production and success as an independent advisor is to shift the focus away from your bottom line and toward your clients’ best interests. Your clients’ financial well-being and literacy should be your chief concern. Aim to educate them and build meaningful relationships. With a focus on client service, the goal will be their success, which in turn can bring you success as well. True success in the financial services industry likely hinges upon passion on both sides of the relationship. As an advisor, you’re passionate about helping clients protect their finances. Likewise, most people — especially those who work with an advisor — are just as interested in attaining financial security. People from many income levels generally have the same financial concerns; they face the same financial problems and obligations. By using the right tools to get your prospects’ attention, you can show them their financial goals are within reach. Client education is the first step toward establishing a strong, lasting relationship. Once clients understand money management basics, you can work together to find money they lose out on unknowingly and turn that money into a stream of retirement income. Key concepts, such as efficiency of money and cash flow, can help clients take

control of their financial lives on a granular level. I help clients approach their family finances in the same way the chief financial officer tackles a company’s balance sheet. It may be in everyone’s best interest to get rid of debt. I don’t believe there’s such a thing as “good debt.” Not only does debt draw funds away from retirement plans every month, but financing costs also drain purchasing power. Once all debts are settled, money previously budgeted for monthly payments can be funneled into financial planning and retirement. From there, clients will be better capitalized to potentially secure their futures with the products or investments that make the most sense for them.

Identify a Niche Market Danny O’Connell

Passion and the pursuit of what you love are the cornerstones of success in business. I let passion guide me to open my own practice and develop my support system. The tactics we used to achieve our preliminary goals have scaled our practice growth and are instrumental in creating a continuous referral pipeline. Similar methods can be adapted and applied to any growing practice. Start with a targeted goal as your primary focus. Identify a niche market segment or geographic focus area as a way to streamline your energies. For example, I targeted my new practice to serve small businesses in the greater Dallas area. I provide employee benefits such as 401(k) plans and life and disability insurance to locally based businesses with five to 100 employees. Tailor your communication to your clients’ unique perspectives. It helps to put yourself in your clients’ position and view products through their eyes. To attract entrepreneurs as clients, I address their most common concerns, such as cost control, employee retention and their competitive edge in the market. Employee benefits are a cost-effective way for entrepreneurs

to add value to the bottom line and operations. Once you identify it, articulate your key differentiator in a way prospects can understand. Help them comprehend the basics of your services and earn their trust as a partner who is looking after their best interests. Cultivate a supportive culture within your practice, and work with your team to achieve a defined mission. Share your passion and goals with your employees, and let them know how they fit into your overall plan. It’s best to connect one-on-one with employees to discuss goals and motivate growth. Your staff will look to you to maintain the culture, and, over time, you’ll need to make changes and investments to stay on track. Once the team has bought into your vision, they will be instrumental in helping you achieve success. As your practice and your team grow, you’ll find you are making a positive difference in the lives of your clients and employees and in your community. I’ve learned that success itself isn’t the most important thing; rather, what’s most important is the meaningful impact you make on people’s lives. Thomas W. Young, CLU, ChFC, is a NAIFA member and a 24year Million Dollar Round Table member, with Top of the Table and Court of the Table qualifications. He is the founder and president of 1st Consultants, and is a certified life coach and human behavior consultant. Thomas may be contacted at Danny O’Connell, MBA, is the CEO of Next Level Insurance Agency, which focuses on employee benefits, life and disability insurance, and retirement planning. He has served on the NAIFA-Dallas board since 2013 and on the NAIFA-Texas board for the past two years. He is also a life and qualifying member of MDRT, with seven Top of the Table qualifications and one Court of the Table qualification. Danny may be contacted at doconnell@

March 2018 » InsuranceNewsNet Magazine



With over 90 years of experience, The American College is passionate about helping students expand their knowledge and opportunities as financial professionals.

When #MeToo Meets Industry Conferences Industry conferences can be fertile ground for misconduct and inappropriate behavior. By Jocelyn Wright


uring a recent conversation I had with a young woman, she shared an unpleasant experience she had had while attending an industry conference. After hearing her story, I felt angry and sad. Angry because someone she respected and who was old enough to be her father would do such a thing and sad that there wasn’t another woman (a conference buddy) present who possibly could have protected her from such a situation. After the incident, she did not leave the profession completely. However, she left the firm where she would have had to interact with the creep. How many other stories are there of women in our industry who, already few in number, have been subjected to inappropriate behavior or, God forbid, even worse?

conference app to allow attendees to report misconduct. The impact of this statement coming directly from Kitces and Moore cannot be overstated. When messages come from the top, there is no mistaking the seriousness of the matter. Talk about zero tolerance!

Not Only At Conferences

A code of conduct such as this is not only appropriate for conference attendance but also important in general practice. If we have rules and policies in place for how we will deal with clients, we are well past the time to include rules on how we will deal with one another. Industry conferences can be fertile ground for misconduct and inappropriate behavior. Is there a more male-dominated venue in our profession? There is opportunity; people are more relaxed in a seemingly social environment, especially when you add in alcohol. However, it would be naïve of us to think that such behavior happens only when people are away from the office. It is safe to say that if it happens at conferences, it is also happening in the office. Therefore, we must make it a point to implement this code of conduct at events and reinforce it at home. Moore stated, “If harassment happens at a conference, the individual isn’t likely to come to another one. This keeps the industry unbalanced; the connection with other financial advisors is then broken.” This also applies beyond the conference. When we talk about the lack of women in financial services, we typically attribute it to lack of awareness, limited female role models or few women interested in STEM fields. Have we had a serious conversation about the impact of harassment? Could this help explain the issue of retaining women in the industry? All too often, the reaction is for the victim to leave the firm where the harassment

It is safe to say that if it happens at conferences, it is also happening in the office. In an attempt to address such issues, Michael Kitces and Alan Moore, cofounders of XY Planning Network, announced an anti-harassment code of conduct during their opening remarks at the XYPN annual conference in August. The policy was created by the network’s Diversity Committee, which is made up entirely of volunteer members. The policy states in part, “Conference participants violating these rules may be sanctioned or expelled from the conference without a refund at the discretion of the conference organizers.” XYPN also went so far as to include a feature in the 50

InsuranceNewsNet Magazine » March 2018

took place for fear of speaking up and jeopardizing one’s career. However, not everyone who experiences harassment has the ability to simply change jobs. There is a certain level of privilege that goes along with leaving. Instead, many women will end up enduring in their jobs while hoping that the behavior will end. When someone leaves without reporting the incident, the guilty party goes unchecked and is likely to continue the behavior. Moreover, in cases where the harasser is a high performer, those in charge may turn a blind eye and ignore the situation in order to protect the bottom line. However, thanks in large part to the #MeToo movement, women are now empowered to tell their story without the fear that prevented so many from coming forward in the past. As Oprah Winfrey said during her Golden Globe acceptance speech, “I want all the girls watching … to know that a new day is on the horizon. And when that new day finally dawns, it will be because of a lot of magnificent women … and some pretty phenomenal men fighting hard to make sure that they become the leaders who take us to the time when nobody ever has to say #MeToo again!” Jocelyn Wright is the chair of The State Farm Center for Women and Financial Services at The American College. Jocelyn may be contacted at jocelyn.





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


Generation Z Is Waiting in the Wings They are years away from being clients, but those born in 2000 or later need help with their financial decision-making now if they are to be prepared for their futures. By Nilufer R. Ahmed


here’s a new generation at the table, and it presents a huge opportunity for the financial services world, if the industry plays its cards right. Recent U.S. Census Bureau data indicates that there are currently 74 million members of Generation Z, forming about a quarter of the total U.S. population. Although they are probably years away from being clients (LIMRA defines Gen Z as those born in 2000 or later), there is evidence that their financial personalities are formed early in life. It may be in the industry’s best interest to help influence Gen Z’s financial decision-making and financial behaviors now rather than wait until later. This implies that with a basic financial education today, and with a little help from millennial experiences, Gen Z will be better prepared for their financial futures. In 2017, LIMRA surveyed those members of Gen Z who are high school students ages 16 or 17 in order to better understand what financial advice and tools would help them prepare for their futures. Not surprisingly, the most important topic they want to learn about is financing options for their postsecondary education (see chart). Gen Z is also aware (but to a lesser extent) that they need information on money management, including budget creation and saving strategies.

Strong Advice From Their ‘Elders’

Speaking from experience, millennial college-age students (18 to 22 years old) had strong advice for Gen Z in the hope that their successors could learn from what they now understand about finances. All felt that Gen Z should save while in high school and continue saving in college. Most felt strongly that money management skills were essential before starting college. A typical quote by millennials who did not have the opportunity to take a course related to finances in high school is: 52

“I would have appreciated a better understanding of handling personal finances as early as my junior year of high school. … I would have needed most of this information when I started college.” Other millennials chimed in: “Be careful with your money. Save it, and be careful what you purchase. Before making purchases … think to yourself, ‘Will I still need or want this tomorrow, or am I buying on a whim?’” “Create a budget and stick to it. Find ways to make money and start saving early. … And most importantly, just because you have $1.25 in your pocket, you do not always have to buy that soda!” “Credit cards are like taking money out of your pocket, so don’t think it is free money and max out the card. You will have to pay for it.” Considering this hindsight from millennials, we can determine what topics should be included in a financial education course for Gen Z. These topics may result in less financial stress for Gen Z and can provide the foundation for more stable financial futures. So how can financial professionals help those in Gen Z about to enter the real world of financial management? Here are a few suggestions. » Start all your finance conversations with Gen Z by discussing financing options for college. This topic is highly relevant to Gen Z now, and they will find that money management skills (including budget creation) and saving are all interlinked.

InsuranceNewsNet Magazine » March 2018

» Proactively reach out to those clients who have children in high school. Provide parents with financial information (through a link to online material, for example) they can give to their children. » Develop a short discussion guide about student loans. This is critical, as many (if not most) students will end up with some student loans. A 2015 survey of young consumers who have student loans found that many were confused about their repayment options and by the paperwork needed to repay loans. » Start a local program to educate high school students. Besides providing information to Gen Z, the program can prove to be an effective way of increasing your client base should these students’ parents contact you. Nilufer R. Ahmed, Ph.D., is LIMRA senior research director, insurance research — markets. She is responsible for conducting and reporting on research related to unique markets such as women, multicultural groups and the generations. She has authored reports on marketing to Hispanics, Chinese Americans, Asian Indians and African Americans; women in the U.S. and Canada; and Generations X, Y and Z. Nilufer may be contacted at nilufer.ahmed@

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The Flight to Fees: Health agents in a post-commission world