1) Life settlements allow policy owners to sell their life insurance policies to third parties, often for more than the cash surrender value. They provide liquidity and can be appropriate when premiums become unaffordable or the policy is no longer needed.
2) Many advisors are unfamiliar with life settlements due to outdated information and misconceptions about regulation, buyers, eligibility, and the difference between life settlements and stranger-owned life insurance policies.
3) In reality, life settlements are regulated in most states, reputable buyers exist, and individuals with over two years life expectancy may qualify if the settlement amount exceeds cash surrender value. Life settlements can benefit clients when other options like lapsing the policy would lose value
The Sharp-tongued Short-term Loan Vocabulary You Need to Know Before Borrowing.
Visit http://www.100dayloans.co.uk/i-hate-you-payday-loans/ to see surveys, infographics and videos that will help you borrow smarter.
Active Capital Reinsurance Ltd commenced operations in 2007, mainly providing credit-related reinsurance solutions to financial institutions in Latin America, and it has a general insurance and reinsurance license issued in Barbados.
This document discusses how life insurance companies will need to adapt to changing consumer preferences and technological advances. Specifically:
- Life insurers will need to shift from solely product-focused selling to providing holistic financial planning based on clients' actual needs and requirements.
- Younger generations will research recommendations online and compare options virtually, requiring insurers to provide advice tailored to clients' specific needs rather than just pushing products.
- Insurers will have to conduct more in-depth financial needs analyses and offer customized product offerings and services to attract and retain customers in the increasingly digital landscape.
This document discusses steps for rebuilding one's finances after declaring bankruptcy. It recommends checking credit reports for accuracy, rebuilding credit history with a secured credit card, and establishing an emergency fund. If given the chance to re-age past-due accounts, one should document any agreement in writing and commit to making on-time payments going forward to take full advantage of the fresh start. Re-aging can wipe out late payments but the individual still owes the full balance and must demonstrate renewed ability and willingness to repay debts.
Financial Services: Insight and TrendsNadya Powell
What do customers think of Financial Services brands? What cultural trends should Financial Services brands take note of. This deck hopefully gives you everything you need to know. Thanks to Zoe Decool for research help.
Everyone must have heard numerous rumours about the payday loan industry and how it tries to trap the borrowers in a cycle of debt. These rumours and myths have created a negative image of payday loans in most people’s minds. There is a need to dispel some of these myths to help people realize that payday loans can prove to be an excellent financial support in emergency situations.
We are busting some of the most popular and most heard myths about payday loans.
Life insurers are missing out on a big opportunity by failing to properly address the 18-24 year old segment of the market. These customers are low risk, they offer high life-time value, and they are open to interacting through digital channels.
MALG14 Keynote Address by Zach Lewy, Founder and Executive Director of Arrow Global, considering the conference title: "Ticking the box on problem debt - job done then?"
The Sharp-tongued Short-term Loan Vocabulary You Need to Know Before Borrowing.
Visit http://www.100dayloans.co.uk/i-hate-you-payday-loans/ to see surveys, infographics and videos that will help you borrow smarter.
Active Capital Reinsurance Ltd commenced operations in 2007, mainly providing credit-related reinsurance solutions to financial institutions in Latin America, and it has a general insurance and reinsurance license issued in Barbados.
This document discusses how life insurance companies will need to adapt to changing consumer preferences and technological advances. Specifically:
- Life insurers will need to shift from solely product-focused selling to providing holistic financial planning based on clients' actual needs and requirements.
- Younger generations will research recommendations online and compare options virtually, requiring insurers to provide advice tailored to clients' specific needs rather than just pushing products.
- Insurers will have to conduct more in-depth financial needs analyses and offer customized product offerings and services to attract and retain customers in the increasingly digital landscape.
This document discusses steps for rebuilding one's finances after declaring bankruptcy. It recommends checking credit reports for accuracy, rebuilding credit history with a secured credit card, and establishing an emergency fund. If given the chance to re-age past-due accounts, one should document any agreement in writing and commit to making on-time payments going forward to take full advantage of the fresh start. Re-aging can wipe out late payments but the individual still owes the full balance and must demonstrate renewed ability and willingness to repay debts.
Financial Services: Insight and TrendsNadya Powell
What do customers think of Financial Services brands? What cultural trends should Financial Services brands take note of. This deck hopefully gives you everything you need to know. Thanks to Zoe Decool for research help.
Everyone must have heard numerous rumours about the payday loan industry and how it tries to trap the borrowers in a cycle of debt. These rumours and myths have created a negative image of payday loans in most people’s minds. There is a need to dispel some of these myths to help people realize that payday loans can prove to be an excellent financial support in emergency situations.
We are busting some of the most popular and most heard myths about payday loans.
Life insurers are missing out on a big opportunity by failing to properly address the 18-24 year old segment of the market. These customers are low risk, they offer high life-time value, and they are open to interacting through digital channels.
MALG14 Keynote Address by Zach Lewy, Founder and Executive Director of Arrow Global, considering the conference title: "Ticking the box on problem debt - job done then?"
This document discusses the challenges financial advisors face when dealing with clients who are cognitively impaired or have dementia. It notes that as the population ages, advisors will encounter more clients with memory issues. Advisors must navigate privacy issues and determine when a client's judgment may be compromised. They risk legal liability whether they follow a client's instructions or deny requests. The article examines case studies and recommends advisors hint at cognitive issues to family without disclosing private details, and get doctors' assessments when making transactions for impaired clients. Experts say advisors are not qualified to diagnose issues and need better guidance on assessing capacity and protecting clients from potential financial abuse or exploitation.
The Consumer Financial Emergency Survival Kit (2)Dawn Hicks
The document provides an overview and tips for creating a budget. It recommends knowing where your money is currently going by tracking expenses for a month. Then, estimate income and necessary expenses to create a monthly spending plan with categories like housing, food, transportation, etc. Stick to the budget by reviewing it regularly and adjusting as needed. Going over budget in one area means cuts elsewhere.
Young adults see car insurance as a legal requirement rather than a priority. They have low knowledge about insurance and do not understand their coverage or options. Major life events like getting a car, job, or marrying prompt first insurance purchases. While most young adults have insurance "just in case," they are generally uninformed and comfortable with that lack of knowledge.
Life and Disability Insurance: What 20-and-30 Somethings Think.Catherine Clark
Young adults understand the importance of life and disability insurance but have gaps in their knowledge about different types of policies. Many do not fully understand their own coverage or their partner's coverage. While they want insurance to provide for things like debts, mortgages, and dependents' expenses if something were to happen to them, the reality is that many are likely underinsured due to a lack of understanding about their policies. Younger generations value protecting their earning potential but have not taken full steps to do so through insurance.
1) A presentation was given on a Gambling Brief Intervention and Referral Treatment (GBIRT) screening project being piloted in Multnomah County to screen individuals in substance use and mental health treatment for gambling issues.
2) Baseline surveys found that while most staff said they discussed gambling with clients, only one-third of clients recalled this, and 22% of clients gambled at least monthly. Many clients and some staff lacked awareness of gambling treatment resources.
3) The GBIRT project aims to improve gambling screening, provide peer mentors, and better integrate gambling and substance use treatment through pilot programs and evaluation of screening and referral rates.
Dean Graziosi - 7 Ways to Finding Funding Right NowDean Graziosi
Find Funding Right Now - 7 Ways to Fund Your Deals In Today's Down Market..
We're going to give you specific go-to resources that will help you to locate financing in these seven major funding resource categories:
- Community Banks and Credit Unions
- Friends and Family
- Government Funding and Grants
- Investors
- Hard Money
- Lines of Credit
- Short Term Funding
Understanding financial consumersretail banking, digital banking, omni-channe...CGI
The document summarizes the findings of a survey on financial consumer trends in the digital era. Key findings include:
1) The majority of consumers want omni-channel access to services and to be rewarded for their business. Top wants are rewards, account access, personalized service, wealth advice and spending insights.
2) Satisfaction levels are low for rewards, wealth advice and spending insights. Over half would consider switching for better services.
3) Top reasons for switching banks are poor service, better rates elsewhere, and security concerns.
The document is a presentation about reverse mortgages developed by the National Reverse Mortgage Lenders Association for educational purposes. It discusses what a reverse mortgage is, how it works, recent changes that make it safer and more affordable, and how people are using reverse mortgages to supplement retirement income, pay off debts, defer social security, and afford longer retirements. The presentation aims to help homeowners determine if a reverse mortgage could fit into their retirement plans.
Credit & Debt Issues for Military Familiesmilfamln
For the webinar, Credit & Debt Issues for Military Families, hosted by the Personal Finance Concentration Area of the Military Families Learning Network on September 20, 2016
This white paper from Steria discusses building customer-centric organizations in the financial services sector. It argues that while financial institutions claim to make customers a priority, their operating structures actually create barriers to excellent customer service. The paper identifies organizational silos as a key problem, as they separate customer interactions across departments. It then proposes a four-step model to create true customer-centric enterprises: 1) Identify the customer purpose for each service, 2) Plan customer journeys to achieve purposes, 3) Identify services needed along journeys and build supporting organizations, and 4) Provide access to services through any customer-chosen channel. The model aims to realign organizations around customer purposes in order to consistently meet expectations.
Arizona small businesses want loans, but are baffled why they are still so difficult to obtain even after the recession is over. When it comes to Arizona’s banking landscape and how it directly impacts local small businesses, an eBook released today by Horizon Community Bank outlines a few key challenges that are top-of-mind in the industry and why they are happening.
All product and company names mentioned herein are for identification and educational purposes only and are the property of, and may be trademarks of, their respective owners.
The document summarizes that while customer satisfaction with banks remains high in most regions, customers also express low levels of trust, confidence, and loyalty toward banks. This creates contradictory sentiments. Positive customer experiences are needed to strengthen relationships and improve loyalty, but currently less than half of customers are having positive experiences through most channels. The mobile channel saw the largest increase in positive experiences and could accelerate adoption more quickly than internet banking, despite some concerns regarding mobile banking.
This document discusses customer perceptions of banks and restoring trust in the banking sector. It summarizes that banks have struggled in recent years due to issues like mis-selling scandals and the financial crisis. Banks lost sight of prioritizing customers and took their trust for granted. The document recommends that banks look to Mahatma Gandhi's teachings that customers are the most important part of the business. Banks need to strengthen customer relationships by demonstrating they understand customer needs and have their best interests at heart to regain trust and compete with new entrants.
Why life insurance has evolved into a piece of investment diversificationCBIZ, Inc.
This CBIZ Whitepaper explores reasons why life insurance has evolved into a piece of investment diversification – that is, a product worthy of being described as a “Separate Investment Class.”
Buying insurance can be confusing, but when the unexpected happens – a house fire, a fender bender or a broken bone – it's a relief to know that some of those financial losses will be covered. But how do you know how much coverage you need? And what questions should you ask before buying a policy? Many consumers aren't sure. Insurance coverage is far from one size fits all, so here's a look at mistakes some consumers make when buying insurance.
More info:
https://foursquare.com/westhillconsult
http://westhillconsultinginsurance.tumblr.com/
A life settlement is the sale of an existing life insurance policy to a third party investor. The original policy owner sells their ownership rights for a cash payment that is typically higher than the cash surrender value offered by the insurance company. Investors purchase policies at a discount and hold them until the insured passes away, at which point they receive the full death benefit. Life settlements have existed since 1911 but became more common for individual investors starting in 1997. They provide absolute returns that are not correlated to market performance and are considered a low-risk investment due to contractual obligations of the insuring company.
1. Long term care insurance pays for long term care services such as help with daily activities like eating, bathing, and dressing. It can cover care at home or in facilities like nursing homes.
2. Some key things to know before buying long term care insurance are getting the right amount of coverage, choosing a company unlikely to raise premiums, understanding rejection doesn't mean you can never get coverage, and getting advice from a specialist.
3. Long term care is an important issue for women as they are often caregivers, live longer, and make up a large portion of nursing home residents.
The document discusses the importance of life insurance for expats. It notes that obtaining life insurance can be more complex for expats, as many local insurance companies may not cover people living overseas. It recommends working with an international insurance company that has experience with expats and the potential for future relocation. The document emphasizes that having adequate life insurance should be a top financial priority, as it provides critical protection for family members in the event of death.
More than 73 million Americans acknowledge having an unmet need for life insurance protection. However, many have not purchased life insurance because they think it is too expensive or they would prefer to work with a financial professional. Life insurance can help support a family's expenses in different life stages from when children are young to retirement. Financial needs analysis can help determine the appropriate type and amount of life insurance coverage needed for one's individual situation and goals.
This document discusses the challenges financial advisors face when dealing with clients who are cognitively impaired or have dementia. It notes that as the population ages, advisors will encounter more clients with memory issues. Advisors must navigate privacy issues and determine when a client's judgment may be compromised. They risk legal liability whether they follow a client's instructions or deny requests. The article examines case studies and recommends advisors hint at cognitive issues to family without disclosing private details, and get doctors' assessments when making transactions for impaired clients. Experts say advisors are not qualified to diagnose issues and need better guidance on assessing capacity and protecting clients from potential financial abuse or exploitation.
The Consumer Financial Emergency Survival Kit (2)Dawn Hicks
The document provides an overview and tips for creating a budget. It recommends knowing where your money is currently going by tracking expenses for a month. Then, estimate income and necessary expenses to create a monthly spending plan with categories like housing, food, transportation, etc. Stick to the budget by reviewing it regularly and adjusting as needed. Going over budget in one area means cuts elsewhere.
Young adults see car insurance as a legal requirement rather than a priority. They have low knowledge about insurance and do not understand their coverage or options. Major life events like getting a car, job, or marrying prompt first insurance purchases. While most young adults have insurance "just in case," they are generally uninformed and comfortable with that lack of knowledge.
Life and Disability Insurance: What 20-and-30 Somethings Think.Catherine Clark
Young adults understand the importance of life and disability insurance but have gaps in their knowledge about different types of policies. Many do not fully understand their own coverage or their partner's coverage. While they want insurance to provide for things like debts, mortgages, and dependents' expenses if something were to happen to them, the reality is that many are likely underinsured due to a lack of understanding about their policies. Younger generations value protecting their earning potential but have not taken full steps to do so through insurance.
1) A presentation was given on a Gambling Brief Intervention and Referral Treatment (GBIRT) screening project being piloted in Multnomah County to screen individuals in substance use and mental health treatment for gambling issues.
2) Baseline surveys found that while most staff said they discussed gambling with clients, only one-third of clients recalled this, and 22% of clients gambled at least monthly. Many clients and some staff lacked awareness of gambling treatment resources.
3) The GBIRT project aims to improve gambling screening, provide peer mentors, and better integrate gambling and substance use treatment through pilot programs and evaluation of screening and referral rates.
Dean Graziosi - 7 Ways to Finding Funding Right NowDean Graziosi
Find Funding Right Now - 7 Ways to Fund Your Deals In Today's Down Market..
We're going to give you specific go-to resources that will help you to locate financing in these seven major funding resource categories:
- Community Banks and Credit Unions
- Friends and Family
- Government Funding and Grants
- Investors
- Hard Money
- Lines of Credit
- Short Term Funding
Understanding financial consumersretail banking, digital banking, omni-channe...CGI
The document summarizes the findings of a survey on financial consumer trends in the digital era. Key findings include:
1) The majority of consumers want omni-channel access to services and to be rewarded for their business. Top wants are rewards, account access, personalized service, wealth advice and spending insights.
2) Satisfaction levels are low for rewards, wealth advice and spending insights. Over half would consider switching for better services.
3) Top reasons for switching banks are poor service, better rates elsewhere, and security concerns.
The document is a presentation about reverse mortgages developed by the National Reverse Mortgage Lenders Association for educational purposes. It discusses what a reverse mortgage is, how it works, recent changes that make it safer and more affordable, and how people are using reverse mortgages to supplement retirement income, pay off debts, defer social security, and afford longer retirements. The presentation aims to help homeowners determine if a reverse mortgage could fit into their retirement plans.
Credit & Debt Issues for Military Familiesmilfamln
For the webinar, Credit & Debt Issues for Military Families, hosted by the Personal Finance Concentration Area of the Military Families Learning Network on September 20, 2016
This white paper from Steria discusses building customer-centric organizations in the financial services sector. It argues that while financial institutions claim to make customers a priority, their operating structures actually create barriers to excellent customer service. The paper identifies organizational silos as a key problem, as they separate customer interactions across departments. It then proposes a four-step model to create true customer-centric enterprises: 1) Identify the customer purpose for each service, 2) Plan customer journeys to achieve purposes, 3) Identify services needed along journeys and build supporting organizations, and 4) Provide access to services through any customer-chosen channel. The model aims to realign organizations around customer purposes in order to consistently meet expectations.
Arizona small businesses want loans, but are baffled why they are still so difficult to obtain even after the recession is over. When it comes to Arizona’s banking landscape and how it directly impacts local small businesses, an eBook released today by Horizon Community Bank outlines a few key challenges that are top-of-mind in the industry and why they are happening.
All product and company names mentioned herein are for identification and educational purposes only and are the property of, and may be trademarks of, their respective owners.
The document summarizes that while customer satisfaction with banks remains high in most regions, customers also express low levels of trust, confidence, and loyalty toward banks. This creates contradictory sentiments. Positive customer experiences are needed to strengthen relationships and improve loyalty, but currently less than half of customers are having positive experiences through most channels. The mobile channel saw the largest increase in positive experiences and could accelerate adoption more quickly than internet banking, despite some concerns regarding mobile banking.
This document discusses customer perceptions of banks and restoring trust in the banking sector. It summarizes that banks have struggled in recent years due to issues like mis-selling scandals and the financial crisis. Banks lost sight of prioritizing customers and took their trust for granted. The document recommends that banks look to Mahatma Gandhi's teachings that customers are the most important part of the business. Banks need to strengthen customer relationships by demonstrating they understand customer needs and have their best interests at heart to regain trust and compete with new entrants.
Why life insurance has evolved into a piece of investment diversificationCBIZ, Inc.
This CBIZ Whitepaper explores reasons why life insurance has evolved into a piece of investment diversification – that is, a product worthy of being described as a “Separate Investment Class.”
Buying insurance can be confusing, but when the unexpected happens – a house fire, a fender bender or a broken bone – it's a relief to know that some of those financial losses will be covered. But how do you know how much coverage you need? And what questions should you ask before buying a policy? Many consumers aren't sure. Insurance coverage is far from one size fits all, so here's a look at mistakes some consumers make when buying insurance.
More info:
https://foursquare.com/westhillconsult
http://westhillconsultinginsurance.tumblr.com/
A life settlement is the sale of an existing life insurance policy to a third party investor. The original policy owner sells their ownership rights for a cash payment that is typically higher than the cash surrender value offered by the insurance company. Investors purchase policies at a discount and hold them until the insured passes away, at which point they receive the full death benefit. Life settlements have existed since 1911 but became more common for individual investors starting in 1997. They provide absolute returns that are not correlated to market performance and are considered a low-risk investment due to contractual obligations of the insuring company.
1. Long term care insurance pays for long term care services such as help with daily activities like eating, bathing, and dressing. It can cover care at home or in facilities like nursing homes.
2. Some key things to know before buying long term care insurance are getting the right amount of coverage, choosing a company unlikely to raise premiums, understanding rejection doesn't mean you can never get coverage, and getting advice from a specialist.
3. Long term care is an important issue for women as they are often caregivers, live longer, and make up a large portion of nursing home residents.
The document discusses the importance of life insurance for expats. It notes that obtaining life insurance can be more complex for expats, as many local insurance companies may not cover people living overseas. It recommends working with an international insurance company that has experience with expats and the potential for future relocation. The document emphasizes that having adequate life insurance should be a top financial priority, as it provides critical protection for family members in the event of death.
More than 73 million Americans acknowledge having an unmet need for life insurance protection. However, many have not purchased life insurance because they think it is too expensive or they would prefer to work with a financial professional. Life insurance can help support a family's expenses in different life stages from when children are young to retirement. Financial needs analysis can help determine the appropriate type and amount of life insurance coverage needed for one's individual situation and goals.
Dignity For Life: Five Things You Should Know Before Considering Long-Term Ca...tbaldinette
1. Take advantage of available discounts like spousal or group discounts which can save 5-30% on premiums.
2. Consider policies that pay cash benefits which provide full flexibility in how funds are used rather than reimbursement policies.
3. Return of premium riders are attractive but may substantially increase premiums, so weigh the costs and benefits for your situation. The primary purpose of coverage is protection from long-term care costs.
This document provides an overview of long-term care, including:
1) Long-term care refers to medical and social services for those with disabilities or chronic illnesses who need assistance with activities of daily living.
2) Medicare generally does not cover long-term care services.
3) Long-term care insurance helps pay for long-term care services such as nursing home care or home health care. There are financial and quality of life benefits to purchasing long-term care insurance for those who qualify.
4) The likelihood and costs of needing long-term care are significant and long-term care insurance can help cover these costs and protect assets. Determining if long-term care insurance is
Long-term care refers to medical and social services for people with disabilities or chronic illnesses who need assistance with activities of daily living like bathing, dressing, or eating. Medicare does not cover most long-term care services. Long-term care insurance helps pay for long-term care services in facilities or at home. There is a high likelihood that many people will need long-term care services at some point, and the costs of nursing home or home care can be substantial. Long-term care insurance may be appropriate for those seeking to protect their assets from these potential costs.
This document discusses the importance of life and disability insurance. It begins by noting that many employees are underinsured or lack insurance, leaving them vulnerable if the primary wage earner dies or becomes disabled. Specifically, only around half of workers have short or long-term disability coverage, and 41% of adults lack any life insurance. It then examines reasons for this, such as financial priorities, lack of knowledge, and procrastination. The document emphasizes that disability is more common than most people assume, with a 33% chance of a 6-month disability, and that disabilities usually stem from common illnesses not covered by workers' compensation. Finally, it notes the high financial toll of disabilities, with costs potentially totaling around $1 million
This document provides an overview and guide to different types of "peace of mind insurance". It discusses medical insurance which covers medical expenses, life insurance which provides financial protection for dependents if the policy holder dies, critical illness insurance which pays out if the policy holder is diagnosed with a critical illness, and income protection insurance which replaces a portion of lost income if the policy holder is unable to work due to illness or injury. The guide explains what each type of insurance is, how it works, why it is important, and things to consider when choosing a policy to ensure the right coverage is selected.
This document provides an overview and guide to different types of "peace of mind insurance". It discusses medical insurance which covers medical expenses, life insurance which provides financial protection for dependents if the policy holder dies, critical illness insurance which pays a lump sum if diagnosed with a critical illness, and income protection insurance which replaces a portion of lost income if the policy holder is unable to work due to illness or injury. It stresses the importance of these types of insurance in providing financial security and peace of mind for families when faced with unforeseen life events and stresses the importance of understanding the details and choosing appropriate coverage.
The document is a guide to expat peace of mind insurance. It discusses the importance of protecting your wealth and ability to earn income through various types of insurance policies. These include medical insurance to cover healthcare costs, life insurance which pays out a lump sum if you die, and income protection insurance which replaces lost wages if you cannot work due to illness or injury. Choosing the right insurance requires understanding the different options and your specific needs to ensure your family's financial security.
The document is a guide to expat peace of mind insurance. It discusses the importance of protecting your wealth and ability to earn income through various types of insurance policies. These include medical insurance to cover healthcare costs, life insurance which pays out a lump sum if you die, and income protection insurance which replaces lost wages if you cannot work due to illness or injury. Choosing the right insurance requires understanding the different options and your specific needs to ensure your family's financial security.
This document provides an overview and guide to different types of "peace of mind insurance". It discusses medical insurance which covers medical expenses, life insurance which provides financial protection for dependents if the policy holder dies, critical illness insurance which pays a lump sum if diagnosed with a critical illness, and income protection insurance which replaces a portion of lost income if the policy holder is unable to work due to illness or injury. It stresses the importance of these types of insurance in providing financial security and peace of mind for families when faced with unforeseen life events and stresses the importance of understanding the details and choosing appropriate coverage.
The document is a guide to expat peace of mind insurance. It discusses the importance of protecting your wealth and ability to earn income through various types of insurance policies. These include medical insurance to cover healthcare costs, life insurance which pays out a lump sum if you die, and income protection insurance which replaces lost wages if you cannot work due to illness or injury. Choosing the right insurance requires understanding the different options and your specific needs to ensure your family's financial security.
This document provides an overview and guide to different types of "peace of mind insurance". It discusses medical insurance which covers medical expenses, life insurance which provides financial protection for dependents if the policyholder passes away, critical illness insurance which pays out a lump sum if diagnosed with a critical illness, and income protection insurance which replaces a portion of lost income if the policyholder is unable to work due to illness or injury. It stresses the importance of these types of insurance in providing financial security and peace of mind for families when faced with unforeseen life events and expenses.
This document provides an overview and guide to different types of "peace of mind insurance". It discusses medical insurance which covers medical expenses, life insurance which provides financial protection for dependents if the policy holder dies, critical illness insurance which pays out if the policy holder is diagnosed with a critical illness, and income protection insurance which replaces lost income if the policy holder is unable to work due to illness or injury. It stresses the importance of having insurance to protect your ability to earn and provide for your family from the financial consequences of unforeseen life events.
This document provides an overview and guide to different types of "peace of mind insurance". It discusses medical insurance which covers medical expenses, life insurance which provides financial protection for dependents if the policy holder dies, critical illness insurance which pays a lump sum if diagnosed with a critical illness, and income protection insurance which replaces a portion of lost income if the policy holder is unable to work due to illness or injury. It stresses the importance of these types of insurance in providing financial security and peace of mind for families when faced with unforeseen life events and stresses the importance of understanding the details and choosing appropriate coverage.
1. WHITE PAPER
The Real Story About
Life Settlements
Inform yourself about an often-
misunderstood—and potentially powerful—
tool in your advisor’s toolbox
If you’re like most advisors, the following words may pop into
your head when you think about life settlements: Confusing.
Privacy concerns. Questionably legal. Unregulated. Or just plain
creepy. Some of these ideas about life settlements stem from
real concerns, while others are based on misconceptions or
outdated information.
The truth is that life settlements are simply another powerful
tool in an advisor’s toolbox. They can be used skillfully to put
a client’s money in motion, helping create important liquidity
events for them. Research from the London Business School
indicates that life settlements provide an average of four times
as much money as the cash surrender value offered by insurers.1
In cases where a client risks defaulting on his or her life insurance
premiums, life settlements can be a way to find benefit in a
policy that has become burdensome.
However, when it comes to life settlements, the biggest stumbling
block that advisors face is simply a lack of understanding. Indeed,
according to a recent survey by WealthManagement.com and
the Lifeline Program2
, among the most common reasons advisors
don’t recommend life settlements to their clients is their own
lack of knowledge about these options.3
“People have very
outdated ideas about life settlements,” says Snow Inocencio,
Senior Business Development Manager at the Lifeline Program.
“The landscape has changed so much over the past 10 years, and
many advisors aren’t aware of that.”
2. WHITE PAPER
As a fiduciary, you owe it to your clients to offer a full
range of options. This means clearing up some of your own
misconceptions so that you can have an informed, frank
discussion with your clients about when life settlements work
and when they don’t.
These kinds of conversations are becoming increasingly common
as life settlements continue to grow in popularity. The market
for life settlements grew by 20% in 20134
and it is expected to
continue to grow in 2014 as investors seek additional yield.5
“It’s
a tool; the more you have awareness of it, the more you’ll know
how and when to utilize it,” notes insurance expert Jordan Smith,
Vice President of Advanced Design at Schechter Wealth, a wealth
management firm with locations in Michigan and New York.
Addressing Common Misconceptions
Life settlements allow people to sell their existing life insurance
policies to a third-party life settlement provider, often for much
more than the policies’ cash values. Despite the potential benefit of
such a technique, advisors still have many questions and concerns
about when—if ever—life settlements may be appropriate.
To what extent are you familiar with the ability of the
owner of a life insurance policy to sell it to a third party
for more than the cash value or surrender value?
48% Familiar,
but have never
recommended to
clients.
4% Have
recommended that
a client sell a life
insurance policy to a
third party.
7% Have had
clients sell a life
insurance policy to a
third party.
26% Have only
heard of the option
to sell a policy.
15% Not at
all familiar.
Real responses from advisors
about how their clients feel
about life settlements
“It’s a practice that
requires expertise.”
“I would have to
be much more
informed…”
“I’m just not familiar
with the rules.”
“It feels like I am
opening myself up to
big liability if things
don’t go as planned.”
What Advisors Said
3. The recent WealthManagement.com/Lifeline survey
identified advisors’ top concerns with regard to recommending
life settlements:
“Life settlements are for experts only.”
Some 61% of advisors believe that helping clients obtain a life
settlement requires a specialized knowledge set.
Why haven’t you ever recommended that a
client sell a life insurance policy to a third party?
Such a transaction requires a very specialized
knowledge set to recommend or enter into.
38%
32%
25%
24%
22%
15%
I’ve never had an instance in which I
thought it was the best option for my client.
Clients have never asked.
I’m concerned about exposing my clients
to a process that I don’t understand or trust.
I don’t believe they are appropriate for
my clients.
I don’t understand them well enough to
recommend them.
My firm forbids them.
Strongly Agree
Somewhat Agree
Neither Agree Nor Disagree
Somewhat Disagree
Strongly Disagree
WHITE PAPER
4%
6%
33%
28%
29%
4. This belief may stem from the fact that advisors don’t feel
confident that they understand life settlements. While it’s true
that advisors should ensure that they have a firm grasp on the
process before making any recommendations to their clients,
there are plenty of resources to help advisors better understand
how life settlements work. “We recommend that people get out
there and do the research or talk to someone knowledgeable,”
says Inocencio. “Don’t be satisfied with preconceived notions or
outdated information.”
In many cases, choosing a life settlement is easy. Take, for
example, a client who is about to let an expensive policy lapse
rather than continuing to pay the premiums. In this case, a
life settlement offers the client the chance to actually receive
compensation for the policy instead of allowing it to lapse and
become worthless. In fact, nearly 50% of the advisors who were
surveyed agreed that clients who plan to let their coverage lapse
should consider selling that policy.
“The life settlement market is too unregulated.”
Many advisors operate under the misconception that the world
of life settlements is still uncharted territory. “Some advisors still
think the life settlement market is like the Wild West when, in
fact, it’s regulated in the majority of states,” says Inocencio. The
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Clients who plan to let coverage lapse should
consider selling their life insurance policy
Strongly Agree
Somewhat Agree
Neither Agree Nor Disagree
Somewhat Disagree
Strongly Disagree
1%
5% 17%
32%
45%
Real responses from advisors
about how their clients feel
about life settlements
“I strongly do not
agree with ‘Stranger
Owned LI’ in any
manner.”
“No idea who to
trust with this type
of scenario.”
“Seems like an
area ripe for abuse,
misinformation and
sales by unlicensed
individuals.”
What Advisors Said
5. life settlement industry is becoming increasingly regulated, and
these regulations that help protect sellers’ privacy (among other
things) are currently in place in 42 states. (The Lifeline Program
follows guidelines even in unregulated states.)
“Aren’t life settlements the same thing as STOLIs?”
Nearly 3 in 10 advisors said that life settlements’ association with
stranger-originated life insurance (STOLI) policies gave them
pause. This makes sense: STOLIs have been linked to a number
of scams, many of them targeting the elderly. “People were
providing STOLIs under false pretenses,” explains Blair Jacobson,
President of Jacobson Associates, a Pittsburgh, PA-based
financial services company.
However, it’s important to note that STOLIs and life settlements
are not the same thing. For starters, STOLIs have been illegal in
the United States since 2010; life settlements are indeed legal.
In fact, the recent crackdown on STOLIs means that the life
settlement industry faces more scrutiny than ever, leading to an
industry that’s even healthier and more solid in its fundamentals
than it has been in the past. That’s why Jacobson, who warned
his clients against STOLIs, has embraced life settlements in
situations where they have provided a benefit to his clients.
“There are no trustworthy buyers.”
Advisors cited concerns about a lack of trustworthy buyers
as one major reason they’ve avoided life settlements. In fact,
13% of the survey respondents said they were unaware of any
trustworthy life settlement buyers.
Fortunately, there are easy ways to identify a dependable
partner. You can find lists of reputable, licensed life settlement
providers by going through your state’s Department of
Insurance. The Life Insurance Settlement Association, the trade
association for the life settlement industry, also lists reputable
providers on its website, lisa.org.
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6. “Life settlements are only for
people with terminal illnesses.”
The life settlement industry traces its origins back to the
viatical settlements that were popular among AIDS patients in
the 1980s. However, much has changed since then. These days,
life settlements are generally considered appropriate for people
with at least 24 months of life expectancy.
Unfortunately, many advisors are still operating under
an outdated understanding of who can benefit from life
settlements. One-third of the advisors surveyed believed that
life settlements were only appropriate for people with terminal
illnesses or other special circumstances.
In fact, quite the opposite is true. Life insurance policies often
include an associated death benefit rider for people with
terminal illnesses. These provisions often mean that a life
settlement is not the optimal choice in such situations. (See
“When Life Settlements Work” below for more examples of when
life settlements are likely to work in a client’s favor.)
“Life settlements are too creepy.”
It’s not only advisors who have misconceptions about life
settlements; clients can misunderstand them, too. For example,
clients may bristle at the idea of a stranger owning a life
insurance policy in their name.
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It is only for people with terminal
illness and other special cases
Strongly Agree
Somewhat Agree
Neither Agree Nor Disagree
Somewhat Disagree
Strongly Disagree
9%
23%
39%
12%
16%
Real responses from advisors
about how their clients feel
about life settlements
“Had a client
mention he…found
it disgusting.”
“Creepy.”
“Morbid.”
“It seems unethical.”
“I am not sure it is
allowed at my firm or
in New York State.”
“Not sure if it is legal.”
What Advisors Said
7. However, in most cases, life settlement providers sell policies
to institutional investors or to funds that include a blind pool of
hundreds or thousands of policies. “I let my clients know that
we have a rule in place that means we won’t sell their policy to
any one individual,” says Pamela Bancsi, Director of Insurance
Services with ValMark Securities, a licensed broker/dealer that
frequently works with life settlements. “The buyer doesn’t know
who they are or where they live.” Some brokers go even further:
ValMark treats life settlements as securities, which means they’re
also subject to FINRA regulations that provide an extra layer of
documentation and protection.
“My firm doesn’t allow life settlements.”
Some 32% of the advisors surveyed believe that most advisory
firms have policies that forbid the use of life settlements. In reality,
many firms do allow the use of life settlements. Advisors may
want to investigate where their firms stand on the issue. A recent
lawsuit in California targeted advisors at an insurance company
who failed to educate their clients about life settlements.6
When Life Settlements Work
Every client situation is unique. That said, there are some
common situations in which advisors have tended to find life
settlements to be useful:
• When the client can no longer afford the policy. In situations
where the client’s life situation has changed to the extent that
life insurance policy premiums are putting a strain on his or her
finances, the client may be considering letting the policy lapse.
For example, Bancsi recalls working with a client who had a
$500,000 life insurance policy and was close to bankruptcy.
The client was on the verge of not paying the policy’s premiums,
which would mean that the policy would lapse and essentially be
worth nothing. In cases such as these, life settlements enable the
policyholder to receive compensation instead of being forced to
let the policy lapse and become worthless.
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“I let my clients know
that we have a rule in
place that means we
won’t sell their policy
to any one individual,
The buyer doesn’t
know who they are or
where they live.”
— Pamela Bancsi, Director
of Insurance Services with
ValMark Securities,
8. • When the client outgrows his or her policy.
Consider a client who may have taken out a life
insurance policy decades ago when he or she had
young children. Now those children have grown
up and have life insurance policies of their own;
their parent’s insurance is no longer a necessity.
“Maybe you’ve got a plan you put in place
15 or 20 years ago when your family was
growing, and now the coverage is too
expensive,” says Inocencio. “In that case,
you may want to have that policy evaluated
because it could be worth money.”
In other words, a life settlement may allow such
a client to stop paying premiums on a policy
that’s no longer needed—and instead invest the
money in a manner that is more in keeping with
his or her current needs.
• When long-term care needs arise. As clients
age they may find themselves saddled with high
premiums while facing long-term care expenses.
Selling an unwanted life insurance policy may
help people in such situations fund their ongoing
health-care expenses.
• When the client is looking to free up funds
for a more appropriate investment. Over the
years, clients may discover that the policies
they bought decades ago are a mismatch for
their current financial realities.
This was the case for one of Jordan Smith’s
clients. The 75-year-old owner of a Detroit auto
parts supply manufacturer owned a life insurance
policy worth some $23 million. In the event of
the owner’s death, his successor would use the
life insurance proceeds to purchase the company
from the owner’s estate. It was a hefty policy, and
the premiums cost the company $1 million a year.
However, with the decline in Detroit’s auto
industry, plus the economic downturn, the value
of the company declined and the company’s
executives decided to explore alternatives to
paying the $1 million in premiums for the policy.
At that point, the policy’s cash account value
was $2.2 million and the cash surrender value
was $1.7 million (due to around $500,000
in surrender costs). The client opted to sell
the policy on the life settlement market for
$4.4 million, which he was then able to use to
buy a new policy with a death benefit of $13
million (a more appropriate figure considering
the company’s current valuation). The annual
premiums were considerably lower at about
$250,000. Ultimately, the life settlement allowed
the company to purchase a plan that was a
better fit for its current circumstances.
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9. • When changes in estate tax exemptions influence planning.
In recent decades, the purchase of life insurance policies was
a popular way for individuals to reduce their taxable estates.
However, estate tax exemptions have risen significantly in recent
years. This means that many of these people are now saddled
with relatively large life insurance policies that are no longer
serving their previous role of mitigating taxes. Selling the policies
can mean that these clients no longer have to pay premiums for
policies that no longer fit into their larger financial plans.
A Careful Evaluation
While the above situations illustrate cases in which life
settlements can benefit clients, it’s also important to remember
that not everyone who wants a life settlement will qualify for one
or receive an appropriate offer. In addition, while life settlements
work well for some clients, they may not be an appropriate
option for others.
For instance, life settlements may not be useful for someone
who’s 65 years old and healthy. Many life settlement providers
are primarily interested in the policies of people with life
expectancies of 10 years or less. (The Lifeline Program expands
that range to 15-year life expectancies.) Sometimes, too, the
particularities of the policy profile and the life expectancy
projections mean that a settlement is simply not financially
feasible for a client. “I’ve had clients who’ve been interested in life
settlements but couldn’t get an offer above the cash surrender
price for their policy,” says Smith. “In that case, it obviously
doesn’t make financial sense.” Life settlements may also not be
the best choice for someone who is on his or her deathbed, as
more and more insurance products now offer an accelerated
death benefit option.
Blair Jacobson notes that people who sell high-value policies may
run into difficulties if they intend to buy more insurance down
the road. “The life insurance industry will only issue policies up
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“I’ve had clients
who’ve been interested
in life settlements
but couldn’t get an
offer above the cash
surrender price for their
policy, In that case, it
obviously doesn’t make
financial sense.”
— Jordan Smith, Vice President
of Advanced Design at
Schechter Wealth
10. to a certain amount. Even if a policy is sold to a third party, it still
counts toward that total,” he points out.
Finally, clients who are interested in exploring life settlements
should be fully aware of the tax planning implications. Lump-sum
life insurance payouts are generally tax-free for the beneficiaries;
life settlement benefits typically are not. (In recent years, the
IRS has adjusted tax rules on certain types of life insurance such
as life settlements. As a result, it is important that individuals
considering a life settlement check with a tax professional to
understand any potential tax liabilities.) Depending on estate
planning considerations, this could make life settlements a less
appealing option.
Ultimately, the more you know about life settlements, the better
you’ll know when they might benefit your clients. If a client is
pleased with his or her policy, there may be no need to look
into a third-party sale. But if a policy is underperforming, too
expensive, or otherwise misaligned with the client’s overall
financial plan, a life settlement can be a valuable tool—and one
that many people may not be aware of.
“Many clients simply don’t understand that their policies may
have a significant asset value beyond what’s in the contract,”
Jacobson notes. “Showing your client how a life settlement could
be beneficial can really enhance your value as an advisor.” n
1
Januário, Afonso V. and Naik, Narayan Y. “Empirical Investigation of Life Settlements:
The Secondary Market for Life Insurance Policies,” London Business School, 2013.
2
“Life Settlement Research,” WealthManagement.com/The Lifeline Program,
December 2014.
3
“Life Settlement Research,” WealthManagement.com/The Lifeline Program,
December 2014.
4
“2014 Market Outlook for Life Settlements,” The Deal, August 14, 2014.
5
Bloomberg Businessweek, “Investing In Other People’s Life Insurance Makes
a Comeback,” July 30, 2014.
6
WealthManagement.com, “Three New Reasons for Life Settlements,” June 6, 2014.
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contact life settlement
professionals by calling
1-800-282-2388 at The
Lifeline Program. Or visit
www.thelifeline.com.
For more information,