Where's the Money?

My kids are almost out of school for the summer, and it seems like every one of you I speak to is graduating one of their kids from college.  All I know is that this time of year is expensive!  That usually means dipping in to that pile of cash stashed at the bank for just these occasions.  I am willing to bet that our clients have that same stockpile of cash we do, and maybe even a bit more.

The reason is obvious - as nervous as everyone is about the market, there are really very few attractive alternative investments for them to deploy money they would like to keep relatively liquid.  This is where another one of those "13^th Month" ideas can come in to play. 

Many of these clients have also elected to self insure for long term care because of the size of the annual premium check they would need to write, along with, perhaps, a little time in denial about the statistics around long term care.  What some may see as a dead issue, I see as the perfect storm - readily available, under-performing assets combined with a major hole in the client's risk management strategy.

So rather than talk about the need to pay long term care premiums, start a conversation about repositioning assets from a CD, money market or even a maturing bond portfolio in to a "linked benefit" product combining long term care and life insurance.  If you stop and think about it, the advantages for the client are huge:

• The rate of return after tax from the current investment is not significant
• The hit their net worth will take if (WHEN?!) they need long term care is staggering
• They have probably seen their net worth shrink a bit already due to the market
• See my comment above about the client's state of mind regarding the market - they either want no part of it, or want to keep some money on the sidelines

What do we accomplish by moving this asset to one of these products:

• The client will still enjoy an insignificant rate of return on the funds
• Their net worth and lifestyle are protected by the long term care benefits
• The leverage of the asset via the death benefit can take the sting out of the lower net worth
• There is no market risk

For those of you who are concerned about all the opportunities the client may miss out on by being in this product, there is 100% return of premium contractually guaranteed.  If that golden opportunity to make a killing on an investment comes along, they can take their money out and go to town.

A couple other items to consider:

• The underwriting is simplified - no exam, and decisions are made within 72 hours of the phone interview that is the primary piece of the underwriting process.
• This is also a great solution for permanent single life coverage that may no longer be needed.  A 1035 exchange is a perfect way to fund these.
• A great way to introduce this is by including a proposal at policy delivery.  Think about it, if they have already qualified for life insurance, the odds are great that they will qualify for this type of product.

I'll make it even simpler for you - I'll run the proposals and send them with the policy when we mail it to you.  All you need to do is include it in your delivery process, and help them "find the money" sitting on the sidelines.