Thursday, March 28, 2024

When I’m Sixty-Four

There is not a baby boomer who cannot readily identify the origin of that phrase and have a greater appreciation for it as they continue their march to this milestone age.

Paul McCartney wrote the melody for that now old tune around the age of fourteen back in the Spring of 1956. It was released in 1967 on the Beatles’ Sgt. Pepper’s Lonely Hearts Club Band album, when he was a mere lad of twenty-five, and yours truly was an even younger nine years old. Sixty-four seemed like eons into the future for both of us, because it was.

As the years passed, I passed the key markers along the path, quietly turning thirty, with an accompanying birthday party that featured baby bottles and pampers; forty, when I had completed twenty years of military service, and several of my friends and I had to embrace the realization that we had somehow gone from the young shavetail second lieutenants to being the very “old farts”—the colonels that we had made fun of during physical training. Fifty brought membership into AARP, more frequent prostate checks, and watching calories. Sixty brought on the dreaded colonoscopy, but sixty-four still was off in the distance.

As sixty-four approached, I still thought of it as just another milestone marker along the highway of life, and assumed that I would be just as strong, agile, thin, and have the same full head of hair. Well, sixty-four came and went last year, and while I still workout six days a week, mow the lawn and shovel the snow, I am not nearly as agile as evidenced by the less than graceful landing I achieve when jumping fences; there has definitely been some loss of muscle mass and strength, and the only thing thin about my body is the hair on the back of my head. Nonetheless, I liked sixty-four, and played the song regularly during that year, feeling very blessed to be enjoying a meds-free life, still capable of hiking and biking and keeping up with my grandchildren.

This past year, I had the dubious honor of trading my very cool, retired-military Tricare Prime health insurance for the famous red, white, and blue Medicare card, and Tricare for Life is now my secondary insurance. Thank goodness we will never have to worry about purchasing Medicare Supplements and companion Part D drug plans. Gratefully, the Open Enrollment season with the bombardment of calls from Med Supp salespeople, as well as the never-ending barrage of commercials featuring Joe Namath and William Devane is now over for another year.

Sixty-five is supposed to be the new Fifty, but I am beginning to seriously question that as I talk to my friends who are quietly entering retirement with an assortment of aches and pains, and a rash of doctors’ appointments for newly identified acute and chronic conditions that sometimes threaten to upend their retirement and vacation plans. I also noted that references to shoulder, knee, and hip replacements seemed to have a higher than usual presence in the annual Christmas letters and cards that we received this year. Fortunately, the advances in pharmacology and medical science have made these procedures relatively uneventful, as evidenced by the nine-hour hospital stay that my wife enjoyed this past Fall with her second hip replacement, as opposed to the 30-hour overnight stay that accompanied her first replacement nine years ago. The “warranty” on these replacement parts has also improved over the years, and recipients no longer must plan on a “replacement of the replacement” while still having fun with TSA as they pass through airport security.

In 1900, Teddy Roosevelt was president, and the life expectancy in the United States was only forty-seven years of age. In 1935, when his cousin Franklin Delano Roosevelt signed Social Security into existence, as a supplement to pensions and other retirement income enjoyed by citizens of our country, the life expectancy was up to sixty-three years and benefits would begin at age sixty-five. With sixteen workers for each beneficiary, the system was solvent and the future looked bright. Today, with life expectancy far exceeding that, and in the absence of pensions, and the ratio of workers to beneficiaries down to 2.5:1, there is much debate on the future of Social Security, Medicare, and the other “entitlement” programs.

Prior to COVID-19, the life expectancy in the United States had risen to 78.8. This was an average for both men and women, with women still maintaining an edge in longevity. Today, for those born in 2022 this life expectancy is 77.5 years according to the Centers for Disease Control and Prevention. Some states do have longer life expectancies, with Hawaii leading the way at 81.15, and Mississippi having the shortest at 74.91.

While countries like Japan are seeing their societies continue to age—since 2009 more adult diapers are sold per annum than their infant counterparts—the life expectancy in Japan is now 85.9 according to worldometers.info. In Switzerland, it is 84.4, and in France it is 83.3. The U.S. now enjoys the dubious distinction of being in 42nd place in terms of life expectancy among countries around the world.

What has caused life expectancy in the United States to lag behind other countries? Some experts attribute this to gaps in health insurance coverage or health care access, as well as deeper pockets of urban poverty, as well as an inequality between the “haves” and “have nots” which notoriously rears its ugly head in terms of medicine and health care. It is common knowledge that numbers do not always accurately portray the facts, and to this end, also influencing the “average” or median age in the U.S. is the fact that there is a great disparity in the life expectancies between Caucasian Americans (78.6), African Americans (72.9), Asian Americans (86.3), Hispanics (80.6), and Native Americans (77.4). There are counties in the US where the life expectancy of its residents is 86.3 years or as low as 66.81. The Boeing Study surveyed its own workforce and determined that those who retired at age 55 lived until age 83, while those who retired at age 65 only lived an additional 18 months!

While we still rank first in the world in terms of national net worth, because of the disparity in access to health care, and the above factors, life expectancy in the US is no less than six to seven years behind the world leaders. Further complicating this issue is the recent debate over vaccinations, and the ever-growing trend of deaths attributable to suicide, homicide, accidents, opioids, and fentanyl.

Fear not. There is still hope. I recently read a book recommended to me by my youngest daughter entitled Outlive written by Peter Attia, MD, a prominent longevity expert. In his book, Dr. Attia recounts how he discovered how unhealthy he was in his thirties despite being a marathon swimmer and avid biker. Under the premise that we need to adopt Medicine 3.0 and strive to live longer healthier lives by changing our paradigms about medicine and lifestyle, Dr. Attia methodically presents how we can do this and strive to live longer, healthier lives. He explains why your bloodwork and cholesterol results at your annual physical may be normal, but you might still be unhealthy–because “average” is different from “optimal.” He advocates prevention and early detection, exercise, and a more holistic approach to life. The goal is to feel the impact of acute and chronic conditions at a later age. The key to this is to eat better, sleep better, to remain active, focus on walking, retaining muscle mass, as well as exercising your mind, being mindful about our vision and hearing, as well as regular socialization. I am pleased to report that I had already adopted many of his suggestions prior to reading the book and can attest to observable positive changes in my own life.

Sadly, I have already outlived one of my adult children because of cancer. Nonetheless, I am still shooting for being around for the Tricentennial in 2076. I will be approaching my 118th birthday when it occurs. I hope to still be living on my own, and annoying multiple generations of my family with my own brand of Dad jokes.

In The Workplace: The Case For Long-Term Care Insurance And Disability Insurance

More employers are considering a long-term care insurance benefit for their employees. This additional benefit can help attract and retain great talent and also help employees better plan for their own futures. Since many employers already offer disability insurance (DI), there may be some confusion around the need for long-term care insurance (LTCi) and the differences between disability insurance and LTCi. With May being Disability Insurance Awareness Month, let’s take a moment to learn the differences between DI and long-term care insurance. Both benefits have a place in an employee’s overall financial plan.

Long-term care insurance and disability insurance are both designed to help someone cope with a loss of function but for
different purposes. However, they have some commonalities, including:

  • Group coverage may be available with limited or no health underwriting
  • If purchased as individual coverage with more comprehensive benefits, require health underwriting
  • They both fit into a comprehensive financial plan

Let’s review each type of coverage to better understand the differences.

What is long-term care insurance?
Where disability insurance covers a loss of income, long-term care insurance covers the cost of care for people who need assistance with activities of daily living due to chronic illness, disability, or aging. Long-term care insurance can help protect one’s assets and income from being depleted by expensive bills and provide peace of mind. Reasons why someone would want to purchase long-term care insurance are:

  • To have more choices and control over the type, quality, and location of care they receive, whether it is at home, in a facility, or in a community setting.
  • To avoid relying on family members or friends for caregiving, which can be stressful, time-consuming, and emotionally draining for both parties.
  • To reduce the risk of becoming impoverished or dependent on public programs such as Medicaid, which may have limited coverage and strict eligibility requirements.
  • To take advantage of tax benefits and incentives that may be available for long-term care insurance premiums and benefits.
  • To plan and ensure that they have adequate resources and support to meet their long-term care needs.

Liam’s LTCi Story
Liam had always been a healthy and active person. Even well into his seventies, he maintained an active lifestyle. One day he started feeling tired and nauseous but thought it was just a flu bug. After several weeks, he decided to see his doctor, who ran some tests and delivered the shocking news: Liam had kidney cancer. He needed surgery to remove the tumor, followed by chemotherapy and radiation. It also meant that Liam would need long-term care.

When Liam was 55 years old, he met with a long-term care insurance specialist who suggested he consider adding LTCi to his financial plan. Because Liam was in good health, he was approved for an LTCi policy. Fast forward 20 years and as Liam started chemotherapy and radiation, his LTCi policy gave him the financial means to be able to consider several options for his extended care, including home care and assisted living. He and his family decided on a local assisted living facility that provided him with meals, transportation, and social activities. He felt comfortable and supported in his new environment, and he made friends with other residents who were going through similar challenges.

Long-term care insurance gave Liam and his family peace of mind during a difficult time. It allowed him to choose his care options and maintain his dignity and independence. It also protected his financial security and legacy for the future.

How do you obtain long-term care insurance?
Many people obtain long-term care insurance from a private insurance company. However, more employers are offering a group plan—one of the simplest and most cost effective ways to get coverage. Often these policies are a guaranteed issue group benefit. The enrollment process can be as simple as filling out an enrollment form. Group LTCi or hybrid plans are also portable to an individual plan upon leaving the company or retirement.

Offering employees a base plan allows them to then consider an individual supplemental plan that may provide even greater coverage.

Getting individual coverage can be more complicated but also offers greater benefits overall. There will be an underwriting process that involves responding to health related questions. You will also have to undergo a medical exam. The insurance company will then determine your eligibility and premium based on your age, health, and the level of coverage you want. You can compare different policies and rates from different companies before you make a decision. Individual long-term care insurance can be more expensive than obtaining coverage through an employer, but it can also provide much greater protection. Life insurance with an LTCi rider are hybrid policies that provide a death benefit to beneficiaries if care is never needed. These group hybrids are more commonly offered than group standalone LTCi in the market today.

What is disability insurance?
Disability insurance is a type of insurance product that can protect against a loss of income if a policyholder is prevented from working due to a disability. A disability can be caused by an illness or injury that affects the ability to perform core work functions. Disability insurance can replace a portion of the policyholder’s base salary, usually 40 percent to 70 percent, up to a certain limit. Reasons why someone would purchase disability insurance include:

  • Can provide financial protection and peace of mind for people who rely on their income to support themselves and their families.
  • The risk of becoming disabled for an extended period is higher than many people think. According to the Social Security Administration, more than one in four 20-year-olds will experience a disability for 90 days or more before they reach 67.
  • Without disability insurance, a loss of income due to a disability can have serious consequences, such as difficulty paying bills, saving for retirement, or maintaining a standard of living.

Remember that DI is to protect against loss of income. That means that when employees retire, there is no longer a need for it.

Zoey’s DI Story
Zoey, a software engineer at a major tech company, was driving home from work when a truck ran a red light and hit her car. She was rushed to the hospital with a broken leg and had to undergo multiple surgeries. She was unable to work for three months and faced mounting bills and living expenses. Fortunately, she had taken advantage of the disability insurance offered by her employer. It covered 60 percent of her income while she was recovering. The insurance company also provided her with a case manager who helped her navigate the healthcare system and access the resources she needed. Alice was grateful for the coverage as it protected herself and her family from financial hardship.

How do you obtain disability insurance?
There are two main ways to obtain disability insurance: Through an employer or as individual coverage. Many employers offer short-term and/or long-term disability insurance as part of their employee benefits package. These policies are typically cheaper and easier to qualify for than individual policies, but they may have lower benefits, longer waiting periods, or stricter definitions of disability. They also may not be portable, meaning an employee could lose coverage if they change jobs.

Purchasing disability insurance as an individual can be done directly from a broker. These policies are more expensive than offering it to employees as a group benefit and require medical underwriting. On the other hand, they offer more flexibility and customization. You can choose the benefit amount, duration, waiting period, and definition of disability that suit your needs and budget. You can also keep your coverage as long as you pay the premiums, regardless of your employment status.

The Bottom Line: Peace of Mind and More Options
By now it’s clear that both disability insurance and long-term care insurance have a place in any employee’s financial plan.

Disability insurance and long-term care insurance are two types of policies that can help protect income and assets in case of a serious illness or injury. Disability insurance provides a continuation of income if the policyholder is unable to work due to a covered condition, while long-term care insurance covers the cost of services such as nursing home care, assisted living, or home health care—very real expenses that are not covered by health insurance or disability insurance.

By purchasing both types of insurance, employees can ensure that they are protected for different scenarios that might create tremendous financial hardship in the future.

My “Three Bucket” Approach To Explaining Fixed Annuities

As many of you financial professionals can attest to, annuities have become more “mainstream” in the minds of consumers. So much so that we financial professionals are often prompted for more information about annuities from our clients without us ever even mentioning annuities. The industry-wide sales numbers speak to the increasing popularity of annuities, as last year (2023) was the best year in the history of the annuity business with $380 billion (more than 1/3 of a trillion!) written industry wide. That is more than a 25 percent increase from the year prior—which was also a record.

With that, if you get a phone call from a client and he/she says, “Can you teach me really quick about your fixed annuity offerings?” what would your response be? This conversation can be tricky because if you are like me, your natural tendency is to get in the weeds about all the options, bells, and whistles. However, you obviously have to be succinct and jargon free because clients are busy… As somebody once said, “The best presentations have a good beginning, a good ending, and both of those items as close together as possible.”

So, here is my “bucket approach” that I explain to consumers that gives plenty of information but is not a 30-minute dissertation. Furthermore, the below points are not something I just spout out uninterrupted, as there are always questions along the way that make this a dialogue rather than a monologue. From here, imagine I am speaking with one of my clients.

The three different types of fixed annuities that I offer I will call bucket number one, bucket number two, and bucket number three.

Bucket 1: Guaranteed Rate Annuities
The first bucket is what I call the guaranteed rate annuities. If you are familiar with certificates of deposit, with these annuities the interest is credited just like how it is credited with certificates of deposit. Guaranteed and for the number of years you choose. Also, like CDs, you choose how long you want to have your money in the annuity, which can be anywhere from two years to 10 years. Usually, the interest rate is higher the longer out that you go. Again, the main characteristic here is that the interest rate is guaranteed for the length of the term that you choose.

What If you want your money back by the end of the term? There are generally liquidity provisions, such as interest only withdrawals or 10 percent withdrawals, where you can take money out if the need arises, even during your term. However, if you cash it all out prior to the end of the term, a lot like how you will lose interest with a CD, you will be subject to surrender charges with the annuity. What happens if you die prior to the end of the term? Most of these annuities will pass on to a named beneficiary whatever you put in plus whatever it grew to. Today I can give you a guaranteed interest rate of anywhere from 4.5 up to six percent, depending on the annuity term you choose.

Also, this is very cool about any annuity. Whatever interest you earn over a year you don’t have to pay taxes on, at least until you take your money out! Annuities are tax deferred. So, if you are getting five percent over a year on $100,000, you may get a 1099 for $5,000 from the bank on that CD. Conversely, with an annuity, that 1099 does not come until you cash it out. (Note: this last point is irrelevant if you are discussing IRA money.)

Bucket 2: Accumulation Indexed Annuities
The second bucket is a bucket that gives you more upside potential than bucket #1, and it also does not have the downside risk of the stock market. Over “the long run” the stock market has done quite well relative to fixed interest alternatives. However, many consumers don’t have “the long run” to wait out any market downturns that can arise if they have their money in the stock market! You may have heard of “The Retirement Red Zone.” When folks get close to retirement (The Red Zone), losing money is obviously more dangerous than if you were otherwise only 25 years old. You don’t want to lose your money right before you retire!

So, with this product, you can actually harness some of the upside potential that the stock market is known for. But, you don’t participate in the downside. This is bucket #2, which is what I call “accumulation indexed annuities.”

Quite simply, the interest rate that you get in a given year is linked to a stock market index, such as the S&P 500 index in a product example I will use. However, if the market drops 20 percent in a given year, for example, how much money do you lose? You do not lose a penny of your money. You get a zero percent interest in that year. Now, what happens if that market index goes up? You get everything the index does to the upside, up to what is called a cap. For example, one product that exists will give you a cap of 11 percent on the S&P 500. So, in short, in a given year you have the ability to get between zero and 11 percent. No loss if the market drops, but higher potential than fixed rates when the market increases.

These products are not designed to beat the stock market, they are designed to beat the bank and also bucket number one that I talked about. The “surrender charge terms” of these annuities are generally five years to 10 years.

Bucket 3: Income Focused Indexed Annuities
Then you have bucket number three. Bucket #3 is what I call income focused index annuities. Many folks nearing retirement don’t necessarily care so much about accumulating money, but rather having their money turned into an income stream—like Social Security—once they hit retirement. In my experience, folks love their Social Security, they just want more of it! This is where this product really shines. Per dollar that you allocate to an annuity, you will find that the level of income it can generate over your lifetime can potentially be superior to many other products that you are used to. By the way, that income stream is guaranteed and, again, for lifetime!

So how does it work? Your money will grow a lot like how I just explained in bucket #2, the accumulation indexed annuity. You will get somewhere between zero percent and whatever the “cap” is on this product. Now, the cap is generally less on these types of products, for instance six percent instead of 11 percent. However, with these products, regardless of how your money grows or does not grow, today we can point at a guaranteed income amount that the carrier will guarantee you when you want to activate guaranteed lifetime withdrawals. So, for example, a 63-year-old today with $100,000, I can point to a guaranteed level of income of somewhere between $8,000 and $9,000 that he/she can activate at age 65 for example. And that income goes forever and ever and ever, even if you run out of your own money because you have lived too long. Just keep in mind that the guaranteed lifetime income component does have a “fee” of anywhere from .9 percent to 1.2 percent. (Note: Many consumers have no clue what “basis points” are, so don’t use that terminology!)

In Closing
Eight out of 10 times most of the questions that arise are in Bucket #3. Questions such as “What happens if I die? Does the balance go to my spouse or beneficiary?” The answer is yes! Notice that in my conversation about bucket #3, I did not mention roll up rates, the calculations, the payout factors, etc. I usually don’t have to…

GLWBs on an index annuity are quite simply a guaranteed level of income that you can point to today, just like a Social Security statement, and assure the client that when he/she retires this is the income that they are guaranteed for life regardless of how their “index” does. And unlike the myths thrown out there by the media talking heads that are living 30 years in the past, the client does not lose control of their money once they start taking income. There is a difference between annuitization and guaranteed lifetime withdrawals!

Annuity Suitability: The Method To The Madness

In this same Broker World edition, you will see another article entitled, “Options For Being A Registered Rep And Also Selling Indexed Annuities.” In this article I reference NASD 05-50 that happened in 2005, and also SEC 151A that was vacated in 2009. These proposed rules sought to effectively put indexed annuities in the same category as securities when it comes to how indexed annuities are regulated and sold.

As a result of these previous attempts to categorize fixed indexed annuities as securities, there have been “regulatory concessions” made—if you call it that—by the insurance regulators that included additional annuity suitability training for agents and also more forms when it comes to writing fixed annuities. These new requirements came largely in the form of the “2010 Suitability in Annuity Transactions Model Regulation.” This regulation did three things that I list verbatim from the regulation.

Specifically, this Model Regulation was adopted to:

  1. Establish a regulatory framework that holds insurers responsible for ensuring that annuity transactions are suitable (based on the criteria in Sec. 5I), whether or not the insurer contracts with a third party to supervise or monitor the recommendations made in the marketing and sale of annuities;
  2. Require that producers be trained on the provisions of annuities in general, and the specific products they are selling; and,
  3. Where feasible and rational, to make these suitability standards consistent with the suitability standards imposed by the Financial Industry Regulatory Authority (FINRA).

Because of #1, we now have the “Suitability Form” that many agents dread. Not because these agents are writing unsuitable sales, but because the forms can be a disaster and an algebra equation. One math mistake or one field left blank that shouldn’t have been and you are getting a NIGO (Not In Good Order) notification from the carrier on that submitted app. This is why if you do business with an IMO that just sends in the case and doesn’t see it through the ultimate process, your life will be miserable while writing annuities. I would guess that 70 percent+ of the time if the carrier kicks back a case as NIGO, it is because of this form. This is also why I am a fan of E-Apps, which almost guarantee that the suitability form (and other forms) is perfect. E-Apps are a conversation for another day.

I have had many financial professionals that went to write their first annuity application and get frustrated with the suitability form and the process around it. Afterall, this form does not exist with other fixed insurance products that these agents have been exposed to, like life insurance for example. However, this form and process should not be scoffed at a whole lot because that is the carriers doing with fixed annuities what that the broker-dealers do when it comes to securities. Hence, the “regulatory concessions” that I referred to earlier. This form and suitability process is better than the alternative—indexed annuities being classified as securities.

With that, I want to list a few points on the “typical” suitability rules that carriers have. Some carriers have very stringent and defined suitability guidelines, and some carriers are more lenient and undefined. The carriers that have a fairly defined suitability process are usually the major players that do a ton of annuity business. With these carriers’ guidelines in mind, I want to give you a kind of a composite view of their suitability requirements so you can have an idea of if your next case is doable or not. Also, I will discuss rules that are universal with all carriers (like training requirements). This is not an all-encompassing list of suitability issues, but certainly what I see the most:

  • Suitability Training! Based on the 2010 Model Regulation #2, there is generally a four-hour annuity suitability course that is required. This course has recently had additions, in the form of “Best Interest” regulations that have taken place over the last few years. If you submit a case without having completed this first, the entire case is NIGO.
  • Product Specific Training: Again, as #2 in our Model Regulation refers to, you must complete product specific training prior to writing that particular fixed annuity product. If you submit a case without having completed this first, the entire case is NIGO.
  • Now, for the suitability form, which is a part of #1 of our regulations. If the suitability form shows liquid assets that are less than six to 12 months (depending on carrier and depending on client’s age usually) of monthly expenses, the carrier will scrutinize the app and possibly decline.
  • If the suitability form shows that the dollar amount of annuities that the consumer owns is more than 50 percent of their net worth (excluding primary residence), there will likely be additional questions asked. Usually with good rationale, carriers will allow as much as 70 to 75 percent of the client’s net worth in annuities. (Note: I have many agents that also write variable annuities where the broker-dealer “governs” the suitability. These maximum percentages are consistent with what many broker-dealers enforce when it comes to VAs, as our #3 in the 2010 Model Regulation suggests.)
  • Replacements of other annuities where the surrender charge and MVA total more than two to five percent of the accumulation value (as indicated on the Replacement Comparison Form). These percentages vary by carrier but if the client has a surrender charge (plus MVA) of more than the carrier’s percentage guideline, it will likely be declined. Important point: Carriers generally allow for their premium bonus (if applicable) to offset the surrender charge when it comes to this guideline.
  • Funds coming from reverse mortgages will usually lead to a decline.
  • If the client is replacing an annuity where they will lose a large GLWB benefit base (as indicated on the Replacement Comparison Form), the company will likely ask for rationale and if the client is able to get more income with the new product even after losing the old benefit base.
  • If you are replacing an annuity where they will lose a large death benefit (as indicated on the Replacement Comparison Form), the case will be scrutinized and can be declined. (Note: If one passes away prematurely after losing a large death benefit, the beneficiaries can very easily sue the agent and the company.)

Again, the above list is not all encompassing, but should be a good guide that can save you time. Usually each carrier has their own suitability guide that you can reference.

Everyone Has A Story

In 2024, the long term care insurance industry will celebrate its golden anniversary. These fifty years have been chocked full of evolving product offerings ranging from initial nursing home only plans, to traditional, stand-alone products that offer coverage ranging from home care to assisted living facilities to skilled nursing facilities and every other form one can imagine. Hybrid and combination products that feature long term care riders attached to life insurance and annuity chassis, to asset-based products that allow policyholders to largely “self-insure” with a stop-loss measure attached.

Over the past twenty-five years, the long term care insurance industry has really come of age. The advent of new facilities being built by some of the largest names in the hotel industry, changes in tax laws, the addition of Partnership across nearly all fifty states, along with literally millions of years of policy data have allowed carriers to refine their offerings and to provide an even greater array of options for those seeking protection.

Ironically, it has been twenty-five years since I left the practice of law to pursue a career in the long term care insurance industry, so I have been around for half the duration of the industry. When I look back on my own experience, it astounds me how far we have come and, at the same time, how inertia still grips the vast majority of the country’s adults as they continue to mire themselves in denial.

My first clients were part of the Greatest Generation. They fought in World War II, came home, went to school on the GI Bill, raised a family (the Baby Boomer generation), often worked their entire career for the same company, retiring with a gold watch and a pension. If they had a family history of long term care, it was often unknown even to them until we asked open-ended questions that helped them discover this truth. Yes, Mom and/or Dad had come to live with them at the end of their lives, often occupying a bedroom formerly belonging to one of the children. I can remember often asking potential clients during the home interview if they can envision having to displace one of their grandchildren from their bedrooms.

Fast forward any number of years to the baby boomers. Unlike their parents, they do have the stories, far more readily as they quickly became the Sandwich Generation, often finding themselves taking care (physically, emotionally, financially) of aging parents while also supporting their children with college educations. Sadly, this often involves the necessity for second mortgages on their homes as well as a strain on them professionally, emotionally, and physically.

Often, an open-ended question as simple as, “Why did Grandpa (or Mom or Dad) have to move in with you?” would take them back in time to their youth, and we would begin the process of identifying need in their own lives.

As the years have passed, I have found it far easier to identify stories of family long term care among the baby boomers who have lived the “nightmare” up close and personal. One of the most poignant stories I have discovered took place about fifteen years ago. I asked my usual “Have you ever had a parent or grandparent live with you because they could not safely live on their own?” and heard the following story.

“My grandfather came to live with us while I was a freshman in high school. He came to live with us because my grandmother had died, and the family did not think it was safe for grandpa to live on his own. His memory was not what it used to be, and he would often leave the stove on, doors unlocked, or go out to the mailbox without any shoes on. At first, it was cool to have grandpa living with us. I would come home from school, drop off my books, have a snack, walk the dog, and then take my grandpa for a walk. On these walks he would tell me stories about flying in B-25 bombers over Germany in World War II. But as time went on, the walks got longer, Grandpa got slower, and after a while I knew the stories better than he did. By the time I was graduating I hated those walks, and was grateful that I had an after-school job so that I could avoid them.”

As I said, this was a very poignant story and even with the passing of time, I can still remember the visceral account as it was related to me by my client. Of course, the “hot spot” question that closed the sale for me was “how will you feel if, someday, a grandchild of yours has the same feelings about having to walk you around the block?” The look of resignation and then determination in his eyes told me that he was now a believer and would maintain his long term care insurance policy until he died. To date, despite a few rate increases, he has maintained the joint policy he purchased for he and his wife.

Satire is one of my favorite forms of comedy. Kevin Costner’s Robin Hood: Prince of Thieves became Mel Brooks’ Men in Tights. George Lucas’ Star Wars became, again, Mel Brooks’ Space Balls. All the true-life sad stories of grandparents moving in with their families gave rise to Robert DeNiro starring in 2020’s satire The War with Grandpa, which follows an interesting premise as to why DeNiro’s character is forced to move in with his daughter and her family.

After accidentally stealing from a grocery store due to having trouble with the self-checkouts and causing a scene with the store manager, recently widowed Ed Marino (DeNiro)) is visited by his daughter Sally Marino-Decker (Uma Thurman)) who wants him to move in with her family. Ed does not want to leave his house because he built it himself. Sally convinces Ed to move in with her and gives him her son Peter’s (Oakes Fegley) bedroom. Peter is not happy about giving his room to his grandfather and being moved to the attic. Ed is welcomed by Sally’s husband Arthur and two daughters Mia and Jenny. During his first day, Ed spends most of his time in his new room, sitting in his chair and looking at the sky while still thinking about his late wife.

Peter then tells his friends about his grandfather moving in with his family and living in his room. After a miserable first night in his new room in the attic, Peter decides to declare war. Ed agrees, so long as they follow the rules of engagement: They cannot damage other people’s belongings and cannot tell the family about their arrangement. Peter pulls a series of pranks, including replacing Ed’s shaving cream with quick-drying foam and damaging his record player. Ed gets back at Peter with pranks including removing all the screws from Peter’s furniture and rewriting his school report. Ed turns to his friends Danny (Cheech Marin) and Jerry (Christopher Walken) for some advice. Over time, Ed begins to spend time with his granddaughters and son-in-law and learns how to use modern technology, such as self-checkouts and apps which aids him in his own war-like efforts towards his increasingly aggressive grandson.

After an ever-escalating war of pranks on one another (nearly resembling the antics of Home Alone), there is the inevitable climax when the entire family is involved, all is revealed, and an armistice is forced onto the combatants.

As time passes, Ed and Peter finally are getting along until Ed leaves one day to be with Diane, with whom he is now in a relationship. Peter looks on angrily, declaring a war on both of them as they leave, leaving the door open for an unwanted sequel!

While this movie makes light of the ever-growing need for a three-generation family living under one roof, over the past twenty-five years I have encountered the resentment that often accompanies this necessary arrangement. So many times I have asked clients or prospective clients about these experiences and the difference having or not having had a policy made in their lives.

As previously noted, nearly everyone I encounter these days has a story of their own to share. Some of the stories are tinged with good memories and happy emotions, but increasingly I am hearing the opposite. Resentment, frustration, and sometimes even bitterness from the family members who “drew the short straw” or were the only ones willing to step up. Recently, with the advent of National Long Term Care Awareness Month, the staff at Krause Financial was encouraged to tell their own family story of long term care. We encourage you to view them on the Krause YouTube Channel.

The silver lining that accompanies the dark cloud of long term care is that today people have a wide range of choices on how and where to receive any necessary care. The key is to make sure that this care does not have a negative impact on the family financially, physically, mentally, or emotionally. It is about choice. But just like the person who fervently prays to win the lotto but fails to purchase a ticket, this peace of mind starts with having to purchase a policy. Encourage your clients to investigate this valuable coverage while they are younger and have the requisite health and wealth so that they can ensure that theirs is a story with a happy ending.

Joy And Pain

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Most athletes will tell you that the pain of losing is far greater than the joy of winning. Pat Riley, the legendary coach and team executive, said it even more succinctly: “There’s winning, and there’s agony.” This is a psychological concept called loss aversion that was first posited in the 1990s by Nobel Prize winning economist Daniel Kahneman and his research partner, Amos Taversky. Kahneman used to do an experiment with his students called the Coin Flip Scenario. He asks a student if he or she wants to flip a coin. If it lands on tails, then the student pays him $10. If it lands on heads, how much would he or she have to win to make it a worthwhile gamble? For most people, they would have to win at least $20 to make the bet. In short, the pain of losing $10 can only be offset by the possibility of winning an amount much greater than $10. This is because, for most of us, pain is more acute than pleasure.

This same result plays out over a wide variety of situations, including personal finance decisions. This is why diversification is so important and a core part of every good financial plan. However, even in something as seemingly straightforward as diversification, there are differences of opinion. For some diversification is finding a good potential return and layering it with a great potential return. This is the “if some is good, more is better” approach. This can work in some situations, but, if the two options are closely correlated, you’re really not protecting against the downside risk. You’re really just trying to maximize the positives and hoping to weather the storm when things don’t go your way. However, if we believe that diversification is more about risk management, then our approach should be one of mitigating negatives rather than maximizing positives. In life insurance, I would suggest that putting all of your client’s money into one type of product is closer to the former than the latter, even if you have multiple index options from which the client can choose. To truly diversify your client’s plan you need to look at more than one product. Much has been written in these pages and elsewhere of the power of indexed universal life, so for this article I’m going to talk about the benefits of looking at whole life, not as an alternative, but in conjunction with an IUL.

The First Day is the Worst Day
A whole life policy provides guaranteed cash value growth each and every year. That means that regardless of market conditions, interest rates or company decisions the client sees an increase every year. In addition to the guaranteed cash value growth, whole life also provides a non-guaranteed element—dividends. While dividends cannot be guaranteed to be paid, the impact that they have on the policy, once paid, is guaranteed. If the client elects to use dividends to purchase paid-up additions, then both the guaranteed cash value and the guaranteed death benefit of the policy increase. That means that those increases can never be taken away. In an IUL the potential for increases in cash value is potentially significant, but it is not guaranteed and can be more or less than what is illustrated. If the return is less, or potentially zero, the cash value in an IUL can also potentially decrease as cost of insurance charges are applied. For a client that is concerned about seeing her values potentially go down or even stagnate for a period of time, whole life can be a solution. If a portion of her money goes into whole life, then that portion will either grow exactly as illustrated on the guaranteed side, or if a dividend is paid, will look even better. In short, with whole life the first day is the worst day her policy will ever have. If anything changes, it changes for the better.

Guaranteed Contribution
The most important part of any financial plan is the money that goes into it. That is especially true for insurance. If the client can’t pay the premium, then the plan won’t work as promised regardless of interest rates or market performance. So what happens if your client becomes disabled and can’t afford to pay their premiums? Most IULs offer a Waiver of Monthly Deduction rider, which is valuable, but doesn’t guarantee that the premium is paid. Rather, it waives the costs that are deducted, so while the cash value won’t decrease due to cost of insurance charges, it also won’t grow as planned because the premium isn’t being paid. Again, for a client who is concerned about seeing her values stagnate in a vehicle that she planned to use for retirement income, whole life can be a solution. With the Waiver of Premium rider on whole life every dollar of the client’s premium into their base whole life policy continues to be paid. Many companies also have a Disability Benefit rider that will waive some or all of the additional premium being paid into a paid up additions rider. This means that, if a client becomes disabled, the portion of her retirement savings that she allocates to whole life continues to be contributed just as if she were paying it herself. In short, with whole life you not only guarantee the cash value growth, you also can guarantee the contribution.

The moral of this story is that our conversations should not be whole life or IUL. The choice shouldn’t be binary, especially when we consider the concept of loss aversion—the pain of losing is far greater than the joy of winning. Whole life ensures that some portion of your client’s plan is guaranteed to grow, even if the client becomes disabled. So to truly diversify your client’s plan and mitigate those negatives, we should be talking about whole life and IUL.

Should I Add Annuities To My Retirement Plan Or Not?

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Demystifying the annuity conundrum (are they all good or are they all bad?

It seems there is a divided financial services industry which fully embraces annuities as an intelligent complement to social security and other nonliquid assets and the other side of the industry that “bashes” annuities as investments too risky, too complex and commission driven so ipso facto stay away from them all.

Based on my 30 plus years in this industry acting in several capacities(as a General Counsel of a prominent life carrier, as a Chief Compliance Officer supervising hundreds of financial advisers, or as an independent financial advisor) I respectfully submit that both industry camps would serve the public better in not taking sides, i.e. with bad apples in both camps, a trusted adviser should and can serve his/her client’s best interest using both models where suitable. Yes, there are some annuities that have hidden charges, are overly risky and should be shied away from. Similarly, there are advisors who manage clients assets and profess to be “better” yet despite their window dressing are in the bottom line receiving far more compensation than they would by suggesting a risk free annuity with lifetime guarantees without extra rider charges.

To walk the talk, my wife and I have assets, some being managed by large institutional entities, and about a half a dozen lifetime annuities which pay us monthly and provide peace of mind that we don’t worry about the unpredictable stock market being severely affected by the incessant political infighting in Washington and unstable global economy. Presented with full disclosure of the advantages and disadvantages, a trusted advisor can and should educate a client approaching retirement with this landscape and suggest options so the client can make an informed decision about what is most suitable for him/her in terms of risk tolerance (baby boomers are likely more conservative at this time of life).

Anti-annuity bashers frequently misunderstand the myriad of annuity options and find it far simpler to say stay away because commission is paid upon sale. For example, a life only annuity with no period certain for the carrier to pay would be an extremely rare if ever good recommendation since one would make a single lump payment and take the risk that if they passed immediately after accepting the annuity, they would lose the entire investment after a single payment. If the policyholder has beneficiaries (the majority of clients do) this type of recommendation would be not only not in the client’s best interest but also “malpractice.” Query why commission is such a negative yet the majority of the retail industry is based on commission. Would one say all service providers, even waiters/waitresses, could be accused of steering their customers to the highest priced entrees since that will end up with a bigger bill thus higher tip? I’m sure we would agree some do but that doesn’t mean we can not discern what is in our “best interest” and what we would enjoy the most.

According to the Life Insurance Marketing and Research Association (LIMRA), annuity sales in 2022 totaled $310.6 billion, a 22 percent increase from the 2021 sales of $254.9 billion. Taking a layman’s noneconomic inference, 2008 had set the record in annuity sales (which has been far surpassed last year) in part attributed to the severe downtown with the stock market correction due to the dot com companies facing retrenchment. Now, when we are in an era of the baby boomers approaching and entering into retirement, desperate to find safety and security, this has led to massive annuity purchases notwithstanding money managers spending millions on TV advertisements saying to being wary. Todd Giesing, assistant vice president, LIMRA Annuity Research, recently stated the “Fluctuating interest rates in the fourth quarter prompted investors to lock in crediting and payout rates while they were high. Our forecast suggests that protection products will continue to boost growth in the annuity market for the next several years.” Fixed annuities provide downside protection against an unpredictable market whereas sales of variable annuities have suffered for precisely the same reasons when certain policies cannot offer this floor.

I don’t want to tip the scales for either camp since my defense of some annuities could lead certain pure money managers only accusing me of the famous line in Shakespeare’s Hamlet: “The lady doth protest too much, methinks.” (Kind of my pet peeve of not trusting anyone who says to me, “I’m telling you the truth.”) Isn’t that what you should have been already doing without saying you are?

Annuities will have varying degrees of decreasing surrender charges. For those unaware, This means that your money that you set aside into an annuity is held by the carrier who invests the funds and makes their own hedging bets counting on the funds being relied upon for the carrier to make a better spread than what they are offering to the public. The client is not incurring any charges if he/she lets the money grow during this period and allows the surrender charges to go down to zero. A downside is that this money is in a sense not liquid during this period although some carriers allow you to make a 10 percent annual free withdrawal. For qualified funds, if at an age when you have to take annual Required Minimum Distributions(RMDs), these withdrawals are also not subject to any current surrender charges. If you will never be comfortable in not having instant access at any time to all your funds, then annuities are not for you.

So how do you move forward with adding annuities to your overall retirement plan? Naturally, only a portion of your assets should be considered for this investment and the carrier itself ensures that no policyholder has unwittingly tied up the majority of their net worth.

In conjunction with adding another bucket(s) of guaranteed lifetime income for you and your spouse, for those clients I have worked with over the years they will always hear me on my soap box that long term care protection needs to be built into one’s overall retirement plan. (See My Long Term Care Story as an Advisor, Broker World 10/2021.) Obtaining this protection is a gift to your children and/or younger family members who love you. Maybe you have to experience or observe the enormous cost and challenging toll on the caretaker’s time, and emotional wear and tear, to really appreciate the urgency of incorporating this into a plan.

Assuming one’s children volunteer—that there is no worry that they will, of course, take care of you—this loving commitment is unfortunately probably unfair to the younger generation. Outside agency caretaker costs are annually increasing exponentially more than inflation. One client relayed that perhaps I misunderstood his culture. Perhaps so but I doubt it. Walking in on a loved one naked on a bedroom floor having soiled himself might change my friend’s perspective.

Getting one’s affairs in order requires an attorney who can draft a will, set up Powers of Attorney both over you and your property, health directives or trusts as the case may be. Even with my law degree, and multiple security licenses I have held, I usually but not always add annuities with no extra riders attached, include a long term care policy, and life insurance that serves as instant cash to help some estates pay estate taxes without having to sell at less than fair market value other existing appreciated assets. Or, for smaller estates, the life policy’s cash to loved ones is never a bad decision.

This planning is not rocket science. Knowing your advisor, feeling comfortable he/she is experienced, will result in you having peace of mind. Not worrying about the future of your loved ones equates to starting now. Why? I refer you to a book called Still Alice by Lisa Genova about a cognitive psychology professor at Harvard, 50 years of age, who recognizes that she has early stages of dementia and tries unsuccessfully to set her affairs in order before the impairment becomes too severe.

Managing Client Expectations: The Medical Side

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Successful business transactions require a high degree of satisfaction on the part of the client. The results don’t always have to be perfect, but they have to meet the anticipated outcome. A dissatisfied client for whatever reason might not be just a one-time outcome but a continuous loss of business from both the individual, his or her continued needs, and to referrals to family and friends. It might not even stop there, as the internet is now the great perpetuator of personal experiences, both good and bad, to those doing their homework on where to purchase. This is a somewhat melodramatic way of saying that managing client expectations is now more critical than ever and has extended quite firmly into medical underwriting.

In the past there was a great degree of variability in medical offers one could receive from individual insurers. Those who remember the days of Wild West substandard underwriting and the Term Wars can bear direct witness to the same case getting standard to decline arrays of results. With less insurers and an increased involvement of large reinsurers in the process, the individual outcomes have become more streamlined. Involvement of multiple insurers on the same case now lean to more consistent guidelines and policies. The old adage of “show me the impairments your company is good at” rarely exists anymore, since if you are too good at something you are probably wrong. Reinsurers now have thousands and thousands of additional lives they have tracked over the years and are closer to having seen it all than ever before. You are likely to get more similar outcomes wherever you go out with a policy.

Perhaps this is nowhere better illustrated not in the substandard array of underwriting but in the numerous amounts of preferred, select and standard issues where outcomes are tight and price improvements are finite. Many brokers and agents will illustrate a best-case scenario with the lowest pricing in most any event. When there are what the client feels are minor or controlled impairments, they are still looking toward optimal pricing. At one time, the medical director or chief underwriter had a good deal of discretion in adjusting the policy and hoping that investment or volume results would help negate any mortality giveaways. Now, most underwriting is automated, and the results are strict “kick-outs” where blood pressure or cholesterol values or glucose measurement and even build parameters will assign a class well before an underwriter gets to a case, if he gets to it all before a tentative offer is made. These parameters are generally made known to most agents and brokers from the start, so an exaggeration into a better class may meet with preventable failure just with a little due diligence to start.

Sadly, there is less of an appetite for substandard cases than ever before. In the search for predictable results, clean cases provide fewer poor outcomes and variability in mortality. Many companies will set a limit as to the amount of tables they will assess on a case, and sadly decline ones that require too much discovery or expense or even acquisition costs. In these cases, steering clients away from the disappointment of an unexpected decline and into products they can more easily qualify for will meet their needs and may be the better part of valor.

There are other things that can be done to maximize meeting client expectations while still maintaining control of a case and getting the expected outcome. If clients know what kickout rules apply and that their cholesterol measurement or blood pressure measurements and treatment for example are going to fall outside the line of best possible rate, illustrating the expected rate provides a mutually beneficial result. It’s not that you have to under-promise and overdeliver as the saying goes—under-promising may lose the case to another firm who correctly anticipated what would be offered. But more exactly promising and meeting that goal generally does get the job done. It requires a little research which is readily available or provided by the insurer to make this more easily attainable.

Letting a client know that there is a difference between clinical medicine and insurance medicine is another key. Individuals may have multiple impairments all of which are “controlled” and as such are expecting the same rate as those who have none of these conditions. You may have hypertension that is controlled, diabetes which meets treatment guidelines, and sleep apnea which by itself might not cause problems, or coronary atherosclerosis that may not merit a rating in and of itself. But the combination of all of these in a single individual does increase the risk and makes for pricing above the most favorable level. Doctors in clinical practice often tell their patients they are doing as well as can be expected, and patients take that literally as meaning they are in great health. When confronted by one of their patients that their insurance policy was priced higher than they expected, doctors may become patient advocates against the big bad insurance company and feel this is a criticism of their more than adequate care. When explained how risk assessment works and that the client is indeed doing well considering what the impairments are, doctors then become friends rather than enemies in helping the patient/insured understand what the actual problems and assessments really are.

Lastly, candor is probably the most important thing that influences the result of any policy, including providing for loved ones or businesses as was the original intention. In the initial phases, the agent, broker and client must be upfront about any problems or health abnormalities. An initial opinion or tentative quote will not hold if the underwriting process or underwriting results don’t bear that out—in the same way a driving record will flush out previous infractions or DUIs, each application generally will provide a list of every medication a client takes or prescription he or she has ever filled—and leads to more suspicious and detailed underwriting when it doesn’t bear out what the application has represented. In addition, particularly in the contestable period but throughout the life of the policy, if fraud is suspected, answering “No” to all medical questions or omitting significant parts of the medical history that is asked about will result in the policy being rescinded and the expected proceeds not being paid. This results in the ultimate bad will of beneficiaries who are blindsided by what the deceased did or did not say to have the policy issued in the first place.

Expectations that are met result in positive outcomes for all. We all as members of the insurance team must realize that. We are all on the same side trying to issue profitable business for ourselves and those we represent. The better we deliver, the more our industry will thrive.

Petersen International Underwriters 2024 Carrier Forecast

The Lloyd’s disability markets have had a few years of upheaval, primarily due to the international financial markets and low interest rates. For the past three years this insurance market has been pushing (kicking and screaming by many) with higher premiums and lower commissions, as well as more and more conservative terms and conditions in coverages.

As of 2023, these markets have finally slowed their big shifts in changes and become more stable and consistent. These changes have impacted all Lloyd’s Coverholders, which in turn, impact producers who sell excess and supplemental disability programs.

While these changes were happening some Coverholders early on had to adopt while others took an aggressive approach (contrary to market direction) and offered terms and conditions not seen before, such as individual policies with a 30-day cancellation clause. This allowed them to keep rates drastically lower. However, those offering the lesser quality wording are now facing the higher premiums the markets are demanding as well.

What does this all mean?

2024 and beyond are poised for more consistent and strong markets. Pricing is higher than three years ago, but so is the cost of a Big Mac! More stability of the markets also means less radical pricing and terms within the market.

Most standard disability carriers have increased their limits making the attachment point for excess disability insurance higher as well. Also, many carriers are now offering coverages to occupations which, historically, were not written, such as social media influencers and others that may actually work from home.

Does this mean fewer sales in the excess and special risk disability markets? Not at all! The Special risk disability programs from Lloyd’s address numerous situations which the standard disability carriers are unwilling to write. This may include occupations that are still “undesirable” as well as severe health issues (impaired risks), and there is still a need for layers over and above what is available for personal disability as well as business disability coverages.

Based upon a recent Milliman report, 45 percent of all disability sales are now written on a GSI basis. Top executives and professional occupations with high incomes still look to excess disability insurance also written on a GSI basis.

Bottom line, as rough and bouncy as 2020 to 2023 has been in these markets, these same markets are once again offering great products at reasonable (not cheap) prices with strong (not ultra-liberal) terms and conditions.[TP]

Hexure 2024 Carrier Forecast

Embrace Challenges. Seize Opportunities.

The unique conditions of the last few years presented our industry with several unexpected challenges and, in some cases, strategic opportunities. Odds are, we’re not done yet. We expect 2024 to have its fair share of twists, turns and curveballs.

The good news is with every challenge comes an opportunity. We all have the chance to evolve with—and even help shape—the insurance industry next year and beyond. A lot of changes will happen. What matters is how we respond.

New and Persistent Challenges
The greatest challenge for BGAs and IMOs in 2024 will be friction. Specifically, the friction in the sales process for life insurance, annuities and wealth management products.

Consumers in our industry don’t want to buy. They want to be sold. Even in what may prove to be a challenging year for BGAs, you can find ways to deliver that sales process consumers are looking for. An experiential environment that reduces friction but still manages to create trust between advisor and client.

A significant portion of this industry continues to use paper processes. Paper is an extremely coarse interaction you have with the client. It’s more like sandpaper roughing up what could otherwise be a smooth experience. If you think about any other industry, from P&C to banking, most industries in the world have moved away from paper.

What really is challenging to brokers right now is being able to interact with their clientele in a way that meets their expectations—quickly, efficiently and digitally. That doesn’t involve slow and erroneous paper processes. Brokers need to be empowered to respond to skyrocketing client expectations. To offer a sales experience on par with what they get from other industries.

And, this will all need to be accomplished in an increasingly strict regulatory environment. It’s counterintuitive, but the very technology we rely on to improve our sales processes invites more rules and regulations into the equation. We’re seeing this with the expansion of some rules coming out of the government. They are trying to change the way annuities are documented. And, while we already have this wonderful process for illustrating and creating audit trails, they want more.

Real struggles are coming down the pipe, with rules and regulations becoming more stringent. With these added consumer protections, we need to ensure that the consumer is part of the conversation when it comes time to adapt our processes in response.

Create Your Own Opportunities
With all these challenges encroaching, there is still opportunity to be successful for firms with the vision to see it.

Imagine if your firm is the one who eliminates that friction in the sales process. What if you could provide a single pane of glass? A centralized, end-to-end digital experience? The contract sold and executed fully within one platform. You don’t have to jump around from system to system. Or worse, to paper.

You manage every part of the sale in that one system, which allows other opportunities such as instant issue sales. That’s something Hexure has offered through multiple carriers on our platform. And it looks a lot more like the modern sales experience clients expect.

Now, that won’t be the same for annuities. Annuity sales are more about building and maintaining that client relationship as a trusted financial advisor. But you can still include the client in the conversation.

You can even find opportunities with the increased regulations. It is an opportunity to better inform and educate the consumers of these products. A chance to build trust with your clients.

Trust is an inextricable part of sales in our industry. You might consider yourself a savvy investor, but nobody is going to drop $100,000 on an annuity using a mobile app. That’s just not going to happen. We all want to have that experience that when we hand over our money, we trust it is going into good hands.

What we at Hexure are working on is finding ways to, yes, enable clients to interact with this industry the way that they want. But keeping those guardrails in place so it’s still a very safe and secure world. We think that’s accomplished through education and visualization. Providing the visualization tools that help clients see what their investment looks like over time. And does it in a clear and understandable way.

Taking the Long View
I believe that this industry is going through a transformation. No one knows exactly where it’s going. But, we can be there asking the right questions. We can all be doing things today to prepare for the long term.

That philosophy is driving what Hexure is doing to help our clients prepare for the future. More specifically, we’re:

  • Doubling down on our promise of providing an end-to-end digital sales process. Consumers expect it, which means advisors need it.
  • Focusing on our roadmap to deliver curated experiences for every persona interacting with our platform—vendor, carrier, distributor, advisor.
  • Using embedded APIs and an open-architecture strategy to avoid building a walled garden. We want to make the industry more efficient by breaking down barriers between systems. Legacy systems. Competing vendors. We don’t care. We want efficiency for carriers and distributors, and seamless experiences for advisors and consumers.
  • Continuing to scale the benefits we deliver by bringing more features and functionality into the fold. The perfect example is our recent acquisition of Vive, which further enhances our ability to provide a single, comprehensive distribution platform.

Further enabling firms to empower their advisors with a true multi-carrier sales solution for all lines of business.

A Bright Future
The last few years have brought their challenges, and 2024 will be no different. Don’t let that stop you from being optimistic about the future. Take the steps today that will make you more resilient tomorrow, and you can find opportunities in any situation. [LR]

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