JUST the FACTS 1st QUARTER 2011
NEW YEAR’S RESOLUTIONS
For
100% Independently Owned Rates available 24/7
Contact us today for details!
800 710-1115 www.greatplainsannuity.com
PAGE 2
JUST the FACTS | 1st QUARTER 2011
INSIDE… 6
1st QUARTER 2011
WHAT’S THE BEST INCOME RIDER FOR MY CLIENTS?
How can you determine which Guaranteed Income Benefit is the best for your clients seeking reliable retirement income? Learn how Great Plains can help you become the Income Planning Expert!
10
THE NEW NAIC ANNUITY SUITABILITY REGS: A CLOSER LOOK
12
NEW YEAR’S RESOLUTIONS FOR MORE SALES
How the new suitability regulations will impact your annuity sales
PRINCIPALS
Rich Hellerich
Robb Edwards
ANNUITY MARKETING Andy Amborn Brad Allen Brian Dixon Cindy Nelson Kara Langdon Michael Lair
LIFE MARKETING Dick Reynolds Tim Edwards Mary Pierce
Resolve to increase your fixed/indexed annuity and life sales this year with help from Great Plains!
ADMINISTRATION
14
A SIMPLE ROTH FIA SALES PRESENTATION
Karen Brooks
16
GETTING DOWN TO BUSINESS IN 2011
20
THE DOWNSIDE OF NO-LAPSE GUARANTEED UL
22
INCORPORATE THE “WIIFT” PRINCIPAL IN YOUR MARKETING
Show younger prospects how to build an important leg of retirement security, tax savings and financial flexibility with this easy-to-present concept.
Cris Larson
Kathy Putnam Naomi Mayekawa
Small business owners need your help! The recent recession and impact on America’s small business owners have created opportunity in this under-served market.
Educating your clients and asking the right questions now can avoid a potentially painful conversation down the road.
Forget the “What’s in it for me” message and tell prospects and clients “What’s in it for THEM”!
JUST the FACTS | 1st QUARTER 2011
11900 W. 87th St., Ste. 115 Lenexa, KS 66215 Toll Free: 800-710-1115 Local: 913-492-9994 • Fax: 913-492-9998 http://www.greatplainsannuity.com JUST the FACTS is published quarterly for the benefit of independent insurance agents and brokers contracted with Great Plains Annuity & Life Marketing. Great Plains assumes no responsibility for the professional training or continuing education of agents. This publication is for agent use only, and not to be used to solicit sales from the general public. Products noted may not be available in all states. Great Plains does not offer tax, investment or legal advice. While every effort is made to confirm accuracy, published rate and product information is subject to change. Material herein may not be reproduced in any form without permission.
PAGE 3
JUST the FACTS Have you made your 2011 New Year’s resolutions and completed your marketing plan yet? Looking back on the past year, we certainly have experienced many ups and downs in the fixed annuity and life markets, and expect that while the New Year will bring even more challenges, it is also ripe with opportunity. Clients and prospects are looking for guarantees when it comes to their retirement assets, and we can help you provide them! Whether you are looking for a solution to creating reliable retirement income or effective wealth transfer, we have the annuity and life insurance products and presentation concepts to help you. I want to thank all our Great Plains Annuity and Life Marketing producers for creating our biggest production year and company growth ever. We appreciate your relationship with GPALM, and your trust in us for your annuity and life insurance needs. I am more thankful than ever that we are 100% independently owned and represent over 60 insurance carriers. Recent announcements of carriers either being purchased or leaving the annuity market, product withdrawals, and commission and rate reductions seem to be more prevalent than ever. We have the experience and resources to help you overcome these changes when theyaffect your business. Your GPALM Marketing Advisor is an invaluable resource to help you minimize these disruptions. We are watching the flurry of carrier announcements regarding the new annuity suitability regulations that are being phased in between January 1, 2011 and 2013. See the suitability article in this issue (page 8), and be sure you are monitoring your state Department of Insurance web site and other information resources to avoid unexpected problems PAGE 4
with case submissions. We have seen that some carriers have announced, or are considering implementing these new procedures nationwide, likely prior to your state’s DOI implementation. A new, four hour annuity training program is required for all agents in addition to specific training on the various products you may sell. Don’t allow yourself to be blindsided by these new regulations! We will pass additional information as it becomes available! In this issue of Just the Facts, you’ll find information that can help you create your marketing plan for the coming year and enable you hit the ground running. Visit www.greatplainsannuity.com, go to the Marketing Resources tab, and select 2011 Marketing plan. Complete the short survey online, and your GPALM Marketing Advisor and Robb Edwards will follow up with you to build an effective marketing program for the coming year. We have added new marketing and advertising resources for GPALM producers, including: • GraphixTech: Advertising resources, printing and web site development • Financial Help Centers: Book Marketing for lead generation and painless referrals Visit with your GPALM Marketing Consultant or Robb Edwards to take advantage of these and other GPAM tools to design a marketing program to ensure your success in the coming year. I hope you had the opportunity to enjoy your family and friends this holiday season. I thank you again for your relationship with us, and wish you great success for the coming year. Rich Hellerich, President JUST the FACTS | 1st QUARTER 2011
- After-Market Fixed Term Income Annuities -
5.00% - 6.75% Guaranteed All Years! (Not an Income Rider)
The After-Market Fixed Term Annuity offers guaranteed future payments from highly rated insurance carriers but with a significantly higher rate of return than found with a new direct purchase.
e the t a t i l i c Fa our y r o f e s purcha urchase rp client o account! n your ow
• Priced to yield 5.00% to 6.75% Guaranteed All Years, Regardless of Duration • Originally Issued by Highly Rated Insurance Carriers A - AAA
(800) 710-1115 www.greatplainsannuity.com
JUST the FACTS | 1st QUARTER 2011
PAGE 5
What’s the BEST Income Rider for My Client? It has long been said “You get what you pay for”. With so many Guaranteed Lifetime Income Benefit riders available, it can be a daunting task to run carrier quotes to find the GLIB rider that gives your client the most for their money.
Introducing the Great Plains Annuity and Life Marketing’s Income Rider Comparison Worksheet! With just one phone call, your GPALM Marketing Advisor can send you a color worksheet and graph that shows which company provides the greatest income for your client. This worksheet can solve for single or joint income, whether you want to solve for income or the premium needed to generate a desired income, and shows you which is the best rider for each year of deferral for up to 20 years. If the thought of completing the tasks above with just a few carriers seems daunting, Great Plains Annuity & Life Marketing can help you like never before! We track all the major GLIB providers, and can give you a graphic presentation for your client’s specific needs quickly with our new Income Rider Comparison tool. This comparison will help make your client presentation easy, with a spreadsheet for your “leftbrain” engineer type clients, and a color graph that paints a picture for your “right-brain” creative types.
Great Plains can help you become an Income Planning Expert!
Brad Allen Annuity Marketing Consultant
A picture (and a spreadsheet) can be worth a thousand words and position you as the Income Planning Expert! Call your GPALM Marketing Advisor now at 800-710-1115 and receive a sample illustration showing how this tool can help you close more annuity sales, and make you the trusted advisor when creating reliable lifetime retirement income!
PAGE 6
JUST the FACTS | 1st QUARTER 2011
Our Insurance Advisor helps us sleep better at night! “We finally found someone more concerned about our dreams, desires and goals for retirement than pushing a particular product. When he showed us the IncomePLUS strategies he had prepared, we were able to create dependable, tax-advantaged retirement income, plan for potential financial issues later
in life, and build legacy gifts to our children, grandchildren and charity. We feel like we have clarified our needs and goals for retirement, with better control over our financial future. We’re also sleeping better at night knowing we have a plan in place with flexibility to adapt to the future.”
Bring your clients more than just a product solution.
Help them control their financial future!
Call 800-710-1115 today for details! JUST the FACTS | 1st QUARTER 2011
PAGE 7
The New NAIC Model Annuity Suitability Regulation: A Closer Look The National Association of Insurance Commissioners (“NAIC”) has adopted a new Suitability in Annuity Transactions Model Regulation (Model Reg). As expected, state activity has already begun: Wisconsin adopted the Model Reg with a few minor changes (effective date: May 1, 2011); and the Iowa Insurance Division has proposed a rule which is substantially similar to the Model Reg (proposed effective date: January 1, 2011). More states are expected to follow. We have begun to receive notices from our Annuity Carriers that more information will be coming later this year regarding their individual interpretation and application of the new Suitability Regs. One carrier has already announced that they will be applying the model regs nationwide, effective January 1, 2011, regardless of whether the state you are in has enacted them or not. WE ENCOURAGE YOU TO PAY CLOSE ATTENTION TO ALL SUITABILITY ANNOUNCEMENTS YOU RECEIVE! This will minimize interruption or delays of your annuity business, and the potential of having to complete additional requirements for your annuity cases to be issued and receive commissions! GPALM will be proactive in helping you adopt sales practices and procedures to meet the NAIC suitability regulations and specific company requirements. We have taken the body of this article from one of our recent carrier announcements to give you information regarding coming suitability changes and requirements. Here is an overview of five key provisions.
1. Training Producers must take (and the carrier must confirm that you’ve taken) at least four hours of continuing education credits of specialized training in annuities. Both the course and course provider must be PAGE 8
approved by the applicable state department of insurance. This is a one-time requirement and must be completed within six months of the Model Reg becoming law in your state. Additionally, the (Company) will be responsible for providing training and training materials to its producers which explain (1) “all material features” of its annuity products and (2) the Model Reg.
Suitability Analysis during the Sales Process –12 Items to Consider In making a recommendation, the producer must have “reasonable grounds for believing that the recommendation is suitable on the basis of facts disclosed during the sales process” – the list of which has been expanded to include: 1. Age 2. Annual income 3. Financial situation and needs, including financial resources used for the funding of the annuity 4. Financial experience 5. Financial objectives 6. Intended use of the annuity 7. Financial time horizon 8. Existing assets, including investment and life insurance holdings 9. Liquidity needs 10. Liquid net worth 11. Risk tolerance 12. Tax status (Continued on page 10) JUST the FACTS | 1st QUARTER 2011
Breaking News... MarketTen Bonus Index is Back! TM
New-Design Bonus Index Annuity. Return of Premium Guarantee at NO Cost! MarketTen Bonus Index
Also Features
• Available in Most States
• Income For Life Rider Available
• 6% Premium Bonus for first 5 years
• Full Accumulation Value at Death - No Annuitization Required
• 10-Year Design • 6% MGA Commission
• 10% Penalty-free Withdrawals for ALL Issue Ages • Variety of Index Strategies with Competitive Rates • Flexible Premiums
Questions? Call us today!
800.710.1115
Surrender of the contract may be subject to surrender charge or market value adjustment. Withdrawals before age 59 1/2 may result in 10% IRS penalty. Withdrawals do not participate in index growth. Product not available in all states. Contract and rider availability may vary by state. Nursing Home Waiver not available in MA. Contract issued on Contract Form Series ET-MTB-2000(06-07). Group Certificates issued on Form Series ET-MTB-2000C(06-07). EquiTrust Life Insurance Company, West Des Moines, Iowa. For Producer Use Only. AC10-ET-MTB-1192
JUST the FACTS | 1st QUARTER 2011
PAGE 9
(Continued from page 8)
The New NAIC Model Annuity Suitability Regulation: A Closer Look
3. Suitability Analysis during the Sales Process – What the Producer Must Believe As a result of the suitability analysis, the producer must have a “reasonable basis to believe”: 1. The consumer has been “reasonably informed of the various features of the annuity” – for example, surrender charge period and amounts; potential tax penalties associated with the sale, exchange, surrender or annuitization of the annuity; mortality, expenses and investment advisory fees; potential charges for and features of riders; limitations on interest returns; insurance and investment components and market risk; 2. The consumer would benefit from certain features of the annuity, such as tax-deferred growth, annuitization or death or living benefit; 3. The particular annuity as a whole, the underlying sub-accounts to which funds are allocated at the time of purchase or exchange of the annuity, and riders and similar product enhancements, if any, are suitable (and in the case of an exchange or replacement, the transaction as a whole is suitable) for the particular consumer based on his or her suitability information; and 4. (If applicable) an exchange or replacement is suitable including taking into consideration whether the consumer: a. Will incur a surrender charge, be subject to the commencement of a new surrender period, lose existing benefits (such as death, living or other contractual benefits), or be subject to increased fees, investment advisory fees or charges for riders and similar product enhancements;
4. Post-Application Review The (Company) will implement procedures for “review of each recommendation prior to issuance of an annuity that are designed to ensure that there is a reasonable basis to determine that a recommendation is suitable.” The Model Reg provides for the application of screening techniques to identify selected transactions for additional review.
5. Post-Issuance Review The (Company) will implement “reasonable procedure[s] to detect recommendations that are not suitable. This may include, but is not limited to, confirmation of consumer suitability information, systematic customer surveys, interviews, confirmation letters and programs of internal monitoring.” The Model Reg allows for the application of sampling procedures or confirmation of suitability information after issuance or deliver of the annuity.
Conclusion Remember, this analysis concerns only the Model Reg – specific state rules and carrier interpretation/application may vary. We will continue to keep you up to date as states take action, as well as to notify you of any procedural changes that are implemented. Please be sure your GPALM Marketing Advisor has your current email address, mailing information, and permission to keep you informed. Cindy Nelson, Marketing Advisor
b. Would benefit from producer enhancements and improvements; and c. Has had another annuity exchange or replacement and, in particular, an exchange or replacement within the preceding 36 months.
PAGE 10
JUST the FACTS | 1st QUARTER 2011
TWO ways to protect your clients’ retirement savings regardless of how the market performs... • Return of Premium Guarantee At NO COST! • Premium Bonus for first 5 years • Income for Life Rider Available • Full Account Value at Death— Annuitization NOT Required • 10% Penalty-free Withdrawals for all issue ages • Variety of Strategies with Competitive Rates • Flexible Premiums
• A fixed-indexed annuity with Return of Premium and Bailout • features not found in a CD
• Return of Premium At Any Time No Charge!
• Guaranteed Lifetime Income Option 10% Rollup Credit • Bailout Cap For Indexed Strategies
• 10% penalty-free withdrawals in the first year & each year thereafter • No MVA / Available to Age 85
Team up with Great Plains for access to these and over 60 insurance carriers and hundreds of products. We’re 100% INDEPENDENTLY OWNED to guarantee you access to the fixed annuity and life products you need!
800-710-1115
Call today or visit www.greatplainsannuity.com
JUST the FACTS | 1st QUARTER 2011
PAGE 11
New Year’s Resolutions for successful agents! Here’s a list of ways Great Plains is going to help agents and brokers enjoy a financially rewarding New Year... call your GPALM Marketing Advisor for details. You can also visit our web site and complete an on-line marketing plan that we’ll help you make a reality in 2011! 1. Utilize After Market Annuities – Resolve to get in front of high net worth prospects and set yourself apart with this incredible “door opener”. Offer clients and prospects the opportunity to earn 5.00% to 6.75% or more from highly rated carriers!
2. Sharpening Your Lead Generation Tools – Resolve to review all your advertising and marketing efforts, including all image pieces, point of sale materials, seminars and web site. GPALM can help with advice and programs that include everything from “tweaking” your existing materials to a complete overhaul of your personal and agency image. Visit our web site: www.greatplainsannuity.com for more information. Our in-house advertising department and quality support vendors will help you maximize your efforts to convert leads into clients!
3. Become an Income Planning Specialist – Great Plains can help you write more cases and larger annuities with our IncomePLUS laddered annuity and life insurance planning tool. Become the trusted advisor and close more sales when you show clients and prospects how they can enjoy tax-advantaged and reliable retirement income using our custom presentation tools!
4. Consider Niche Marketing – Great Plains is committed to helping brokers enter and succeed in the small business owner market (see page 16). Is this a market you could excel in with the right support? Think about other markets where you have a competitive advantage or you could focus on during the coming year. We can help with a customized strategy to help you penetrate your niche market!
PAGE 12
JUST the FACTS | 1st QUARTER 2011
Professional, goal-oriented websites, stunning print graphics and distinctive brands focused on building stronger, more effective businesses! Whether you are a new business just starting out or if you need to spruce up your existing “brand”, GraphixTech can can handle it all. Our goal is to provide you with high-quality marketing material that makes a positive impact for your business.
Website Packages: Business Card Website GPAM SPECIAL: $570.00
Yearly Savings of $430.00
• Free Setup • 1 Year Hosting • Up to five email addresses • One Contact Form • Website Maintenance* • Webmail • Free Flash Banner
(Compliments of GPAM - $100 Value)
Branding Packages Design Only: $400.00 Design & Print** $625.00 (500 Each) $710.00 (1000 Each)
• Free Setup • 1 Year Hosting • Up to three email addresses • One Contact Form • Website Maintenance* • Webmail
Five Page Website GPAM SPECIAL: $900.00
Business Packages:
• Logo Design • Business cards • Letterhead • Envelopes
Yearly Savings of $400.00
Complete Packages $1,100.00 (Without Printing) $1,425.00 (Quanity 500) $1,510.00 (Quanity 1000) • 5 Page website • Free Setup • 1 Year Hosting • Up to five email addresses • One Contact Form • Website Maintenance* • Webmail • Identity Branding Package
*Minor text changes / edits only. **Premium Paper Stock available at additional cost. Print items include: Business cards, Letterhead & #10 Envelopes. Domain name is not included in above web packages. Prices as of 1/1/2011 and Subject to change. Additions and modifications to packaged websites available at additional cost. Additional email accounts: $10 Per Account with 500MB of Storage per account.
Call your GPALM Marketing Advisor or Robb Edwards at: 800.710.1115
JUST the FACTS | 1st QUARTER 2011
PAGE 13
A Simple ROTH FIA Sales Presentation for Younger Prospects Consider this simple ROTH IRA presentation for younger prospects or referrals that appeals to their concerns about our current economic uncertainty. Many younger workers worry about unfunded liabilities for government entitlement programs such as Social Security and Medicare, and the impact of current stimulus efforts on their future tax rates. Instead of maximizing contributions to their company 401(k) plan, what if they contributed enough to meet all available matching contributions from their employer, then funded their own Roth IRA with the remaining contributions that would have normally continued into the 401(k)? The comparison of future tax-free withdrawals, when compared to deferring taxes today and paying them in retirement, are dramatic. In addition, your client has access to the other benefits and features offered by a Roth IRA. The chart below shows how younger prospects might embrace the opportunity to build tax-free retirement savings while they can. To learn more contact your Great Plains annuity marketing advisor at 800-710-1115.
Andy Amborn, CAS Annuity Marketing Consultant
Summary: Pay a total of $35,000 less in taxes and receive partial tax free income in retirement! Assumed employer matching of 50% up to $5,000, 30% tax bracket while working, 20% tax bracket in retirement. Contributions made for 30 years, withdrawals for 20 years.
PAGE 14
JUST the FACTS | 1st QUARTER 2011
What’s Your Marketing Plan for 2011? Ask your GPALM Marketing Advisor for our free 2011 Marketing Planner or visit our website: www.greatplainsannuity.com to download your copy. We’ll help you formulate a marketing plan for the coming year (and the rest of 2010) to help you reach your annuity and life sales and commission goals. We’ll also point you to advertising, promotion and sales concepts to turn your plan into a reality. Call us today!
800.710.1115
JUST the FACTS | FALL 2010
PAGE 15
Getting Down to Business in 2011 One of the most important New Year’s resolutions Great Plains Annuity and Life Marketing has made for 2011 is an ongoing commitment to our Small Business Owner marketing program. Being small business owners ourselves, we understand the turmoil the financial downturn of the past several years has caused for millions of business owners across the country. We also appreciate that few of the professional politicians inside Washington’s beltway have ever had to worry about making a payroll, balancing a checkbook or covering expenses. We believe many small business owners are looking for strategies and solutions to accomplish their goals regarding retirement, business perpetuation, successful business transition, and estate planning. We also believe that life insurance is an integral component of those solutions. Defining the Small Business Market According to the U.S. Small Business Administration (SBA), small businesses comprise approximately 44 percent of the total U.S. private-sector payroll. The SBA defines a small business as having fewer than 500 individuals, and small businesses collectively represent nearly 98 percent of all employer firms and half of all private-sector workers in this country. The nearly 30 million small businesses play a vital role in the economic well-being of our country. From 1993 through the third quarter of 2008, smallbusiness owners provided nearly two-thirds of all net new jobs.1 Business Owners Can’t Ignore Important Issues Many owners avoid planning because they think it’s complicated and they don’t want to face certain issues involving the business. It’s easy not to think about challenging issues such as retiring, transitioning to a lesser role in your business, or PAGE 16
facing their mortality. But putting off planning and ignoring these issues isn’t going to give them peace of mind, especially with current economic realities. What could happen if they fail to plan? • Value of the business may plummet if key people critical to success are not retained. Only 27% of businesses proactively manage retention of key employees through funded programs.2 • The business and owner’s legacy may not survive their death. Only 26% of small business owners have a succession plan in place2 and less than 30% of family-owned businesses are transferred successfully to the next generation.3 • They may not have sufficient retirement income if they count on the business to be the primary source of that income. A majority (54%) of business owners are depending on their business to provide most of their retirement income2, and 42% of owners that were surveyed believe that they will not have enough retirement savings.4 • The business may not be able to sufficiently provide for owner’s family after his death. • Owner may not be able to treat non-business children fairly. (Continued on page 18) JUST the FACTS | 1st QUARTER 2011
WE KNOW THE SIX QUESTIONS TO ASK BUSINESS OWNERS How do you think small business owners are sleeping at night with today’s economy? We can give you the tools and marketing support to help them review their existing business continuation plan, and exit strategies that help maximize their financial security and minimize risk and potential taxes. If you have existing small business owner clients, or would like to, call us. We’ll share the six questions that keep business owners up at night. Call today for more information!
(800) 710-1115 Ask for Dick Reynolds, CLU or Tim Edwards JUST the FACTS | 1st QUARTER 2011
PAGE 17
(Continued from page 16) Marketing to small Business Owners Marketing life insurance to small businesses is similar to running a small business itself. The key is in building relationships and trust. The more you know about your small business prospects, the easier it will be to build trust and present strategies that make sense. Your Great Plains Life Advisor can help you do just that, by helping you better understand your small business prospects and help you open the door to this rewarding market. Studies show that small businesses typically go through three distinct phases during their lifetime: • Phase I: Start-Up • Phase II: Growth and Maturity • Phase III: Disposition A key to building stronger relationships with prospects, and making better product recommendations in the process, is to recognize the stage of the business. Identifying your prospect’s stage will allow you to: • Identify specific planning objectives • Offer strategies to help meet their goals • Offer accurate product recommendations A recent small business market study conducted by the Principal Financial Group5 discovered that business owners’ stated priorities often don’t match the benefits they actually possess for the business, themselves, or those offered to their employees. Business owners’ top three priorities address: • Business needs • Employee benefits needs • Personal financial needs The discrepancy between priorities and actions may be a result of an operational focus and limited resources during challenging economic conditions. However, it also may be due to a lack of awareness of possible solutions – revealing a need for education around the needs of business owners and the wide array of solutions available to help them meet those needs.
PAGE 18
Getting Down to Business in 2011 Business owners are trying to balance their personal financial needs with the financial needs of their businesses and employees. While business owners focus on all aspects of their businesses, options exist to offer more employee benefits and to add plans to address their business needs. These plans also may address business owners’ personal financial needs to help ensure the success of their business. Business owners focus more on short-term goals than on planning for the future of their businesses, a practice that may adversely impact their long-term goals. For example, the lack of an exit plan could lead to numerous challenges when business owners are ready or need to transition out of their businesses. In addition, ignoring wealth-transfer planning could lead to negative personal financial outcomes. Business owners also recognize the importance of their key employees. Special benefit packages and plans are designed for key employees to help business owners recruit, retain and reward these employees during and after the recent economic recession. The Opportunity Great Plains offers the marketing resources, life insurance strategies, and quality carriers that can help business owners sleep better at night. We can help you position the strategies for protecting the owners business, key employees and his personal wealth which often result in larger premium cases and additional planning opportunities, including annuities. Call us for more information and details on how we can create a personalized marketing plan for you in serving the lucrative small business market! 1. U.S. Small Business Administration, Office of Advocacy, September 2009 2. “Small Business Owner,” 2005 LIMRA International. 3. J.H. Astrachan and M.C. Shanker, Family Businesses’ Contribution to the U.S. Economy: A Closer Look, Family Business Review (September 2007). 4. PNC Wealth Management Wealth and Values Survey: Business Owners and Their Path to Happiness, February 2008 (page 5). 5. “Business Owner Market Study: A Balancing Act – Priorities vs. Plans”. Principal Financial Group
JUST the FACTS | 1st QUARTER 2011
The complete pension package for your small business clientele!
• 412(i) Defined Benefit Plans • 401(k) Plans • New Comparability Profit Sharing Plans • Complete Plan Administration • Small Plan Specialists • Low Fees (starting at $500/yr.) • New design techniques created by EGTRRA
Call your GPALM Marketing Consultant today for details!
(800) 710.1115
For Agent Use Only; Not Approved For Use With Consumers
JUST the FACTS | 1st QUARTER 2011
PAGE 19
The Downside of No-Lapse Guaranteed Universal Life Having worked in the life insurance industry for over 30 years, I’ve watched the ever changing landscape of product development that has occurred every few years. Driven by competition, reserve requirements, investment returns or a shift in markets, carriers continue to give the buying public something new in the way of life insurance to consider. Several years ago a new product was introduced that is commonly referred to as No-Lapse Guarantee Universal Life. While you might get an additional opinion or two from different companies, make no mistake that the main reason for this new product design was to offset the already large problem facing the industry of under-performing blocks of older universal life policies. By older I mean especially those sold with premiums being solved for when current assumed crediting rates were in the double digits. Exchanges or surrenders became and still are commonplace, so something new was needed. Many carriers have been offering this product in both a single life and survivorship form. The selling appeal was simply a premium that would guarantee the death benefit to age 100 or beyond. This was accomplished by marginally increasing the cash values for a handful of years and then reducing them to zero. Given the fact that buyers were really just buying a death benefit they would not outlive if they paid their premium on time, this lack of cash was not a detriment to them buying this form of policy. That is, not yet. Cash values inside of permanent policies have for years given flexibility and options to policy owners. One of these is the ability to have this cash value pay premiums via a loan if the policy owner could not thus keeping the policy in force at some level and for some period of time. For the owners of a no-lapse guarantee UL, and there are many thousands of them, there will typically not be any cash values in later years. PAGE 20
Additionally, most all were sold with a “full pay” level premium requirement to at least age 100. Given this design, how would each client answer the following two questions? 1. Do you want to leave this benefit to your beneficiary(s) no matter how long you might live? 2. Do you feel you will be able to pay this premium when you reach age 70, 80 or even 90? The second question for many (if not most) is going to be an unknown, and certainly the downside of this product. My suggestion would be to show one or two additional illustrations where premium payments cease at some earlier age but coverage continues OR show a current assumption UL where there is a guarantee out to mortality plus the possibility of some cash value. This way you have not only educated your client, but you may well have kept them from losing coverage when they need it the most.
Make Life Easier! Call 800-710-1115 and ask for Dick Reynolds, CLU
Set Yourself Apart from The Competition! If your prospect needs reliable retirement income, selling an annuity makes sense. However, we know there are many consumers, retired or very near retirement, who have some cash assets they will probably never touch (CD’s, annuities, cash value in life policy, etc.) because they hope to leave a legacy to heirs or charity.
This is where presenting a Single Premium Whole Life plan makes more sense than the annuity. Given the choice, your prospect will agree. Benefits of Single Premium Life • Heirs/Beneficiaries receive significantly more money • Unlike an annuity, the death benefit is 100% free from income taxes • Products provide for 95% to 100% liquidity from day 1 • LTC benefit available with some policy forms
It’s a Simple Sale • Product is very simple for the Client and the Agent to understand • NO EXAMS, blood or urine tests required-simplified issue with a simple application • Underwriting typically completed in a week or less, speeding up commissions
Benefits for the Agent • Commissions are typically higher than for annuities. • Many agents only offer annuities. By offering both, you’ll set yourself apart.
Call (800) 710-1115 today! Ask for Dick Reynolds, CLU or Tim Edwards In 5 minutes we can tell you what to ask a client and how to easily explain the product and its benefits. JUST the FACTS | 1st QUARTER 2011
PAGE 21
INCORPORATE THE “WIIFT” PRINCIPLE IN YOUR MARKETING MESSAGES WIIFM is an acronym for “What’s In It for Me?” Your elevator speech, image brochure, business cards, web site and other branding materials should always approach clients and prospects with the value of working with you using WIIFT, or “What’s in it for THEM.” Instead of sharing what you do, approach them with how they can benefit from a relationship with you. The WIIFT principal can dramatically improve your business success by always telling people what’s in it for them when they do business with you. Never tell people what you do. When you say that we do this, we do that, we, we, we you fail to educate your reader or listener with how you can help them. “Stop we-we-weing all over yourself.” Here’s an example, you meet a married couple and tell them you offer life insurance, annuities and mention you have attained several educational and professional designations. What does that mean to them? Had you told them you help families sleep better at night, knowing they have protected and guaranteed their retirement savings, and created legacies for their children and grandchildren; they might apply that information to their personal PAGE 22
situation. Best of all, approaching them this way, they may wonder, “If he can do that, maybe he can do ________.” Fill in the blank. The resulting conversation may lead to an appointment, yet, you never mentioned selling life insurance and annuities.
verbal and written communication so that it does not attempt to answer every possible question. When you generate questions from your prospects, this grants you access to his or her mind. Begin to utilize the power of creating questions when you are selling, doing, or informing.
When approaching a prospect with your WIIFT approach,
Do you have an advertising question or need branding assistance? Contact your Great Plains Marketing Advisor or Robb Edwards for help at 800-710-1115.
“INSTEAD OF SHARING WHAT YOU DO, APPROACH THEM WITH HOW THEY CAN BENEFIT FROM A RELATIONSHIP WITH YOU.” consider how you craft your message. Appeal to WHO they are, or WHAT they do. Your approach to the couple above and a business owner might offer very different benefits in working with you.
Robb Edwards, Principal
As you can see, creating questions in the mind of potential clients is a powerful technique because we don’t like unanswered questions. Using questions to garner potential client interest is a tried and true technique. It’s in your best interest to construct your JUST the FACTS | 1st QUARTER 2011
Generate 5% to 50% in Warm Leads with Your Own Customized Web Sites and Book Marketing System! Give this valuable financial and retirement planning book for FREE in exchange for warm leads referred to you from existing clients, or sent exclusively to your email address from your customized, lead-generating web sites! This marketing system has been proven to get clients and prospects to "voluntarily" give you between 5% to 50% in referral leads.
"... sent out 25 books , received 17 referrals , and converted 9 to new clients for a total of $15,428 in new commissions..." - RB www.rba.financialhelpcenters.com
SPECIAL PRICING FOR GPALM PRODUCERS! SEE BELOW OR CALL! Go to www.financialhelpcenters.com/about to review the marketing system. Then go to www.financialhelpcenters.net to view the video and create your seven lead-generating web sites! Call your GPALM Marketing Advisor at 800-710-1115 for more information or visit www.greatplainsannuity.com
SPECIAL GPALM OFFER! Receive seven lead-generating web sites, 25 abridged books in paperback, PLUS proven marketing ideas, letters and scripts that have generated agents 5% to 50% in referral leads.
$320.00 Value for just $249.95* Savings of $70.00 Go to www.financialhelpcenters.net and "Create an Account". In the box above the word "activate" type the code "GPAM1" to get the discount, then click "Activate". * Total cost is $249.95 plus $12.95 S&H = $262.90
JUST the FACTS | FALL 2010
PAGE 23
MYGA RATES GOT YOU DOWN? How about
5.00% to 6.75%
GUARANTEED ALL YEARS? A– to AAA Carriers (S&P) Call for details on our After-Market Annuities!
800-710-1115
Have you lost carriers or had products withdrawn during 2010? Team up with Great Plains for access to over 60 insurance carriers and hundreds of products. We’re 100% INDEPENDENTLY OWNED to guarantee you access to the fixed annuity and life products you need! Call today or visit www.greatplainsannuity.com
100% Independently Owned! GPALM PRODUCERS ACCESS ANNUITY & LIFE RATES 24 HOURS A DAY! 11900 West 87th Street, Ste. 115 Lenexa, KS 66215
800.710.1115