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Life illustrated
To MEC or Not to MEC?
Protection Please!
Location, Location, Location!
Coach the Coach
100
The current Gross Interest Rate credited to a Universal Life Insurance Policy today?
What is 3.85%?
100
This number represents the maximum premium allowed to be paid in a given year in the early years of a life insurance policy. Anything more will make the policy a Modified Endowment Contract.
What is the Initial Seven-Pay Premium?
100
A type of trust that is typically funded by a life insurance policy for the long-term benefit of a mentally or physically disabled dependent
What is a Special Needs Trust?
100
The primary question that helps clients reevaluate the types of accounts they have chosen to place their assets.
What is the purpose of this money?
100
4 things to look for in the read ahead
Does the client currently have life insurance? (did we ask?) How old are the clients and what health issues have they experienced? Who is inheriting the assets? What is their financial situation? Has an Asset Location Worksheet been completed?
200
Pays 1% of the face amount to a non-profit at the death of the insured
What is the Charitable Benefit Rider?
200
The three tax benefits available through a non-MEC life insurance policy
What are 1) Tax-deferred growth 2) Income Tax-Free Death Benefit, and 3) Tax-free withdrawals and loans?
200
A sophisticated policy design that provides younger clients with income protection, while also allowing them to grow their savings for future tax-free income in retirement.
What is Supplemental Retirement Income Plan (SRIP) OR Life Insurance Retirement Plan (LIRP)?
200
Three major sources of lump sum premiums typically found in the Tax Now column of the Asset Location Worksheet
What are Cash, CDs, and Fixed Income Investments?
200
3 key questions on the Strategy Call
What are the clients goals/priorities when it comes to legacy? What role does the client see life insurance playing in their financial life (cash accumulation or death benefit)? Does the client feel they have enough coverage? Do you?
300
The policy's interest rate is credited on a _________ basis, while the cost-of-insurance is deducted on a ________________ basis.
What are Daily and Monthly?
300
The IRS applies a 10% income tax penalty on earnings withdrawn from a MEC prior to this age.
What is 59 1/2?
300
The three general risks that may deteriorate or eliminate a client's legacy
What are 1) Market Risk (volatility / sequence of returns), 2) Financial Risk (emergencies / LTC / inflation), and 3) Tax Risk
300
The team at the Life Insurance Company that helps the ISD and the WMA with more complex cases that require additional support with policy design.
What is The Advanced Markets Team (a team of attorneys with a specialty in life insurance law)?
300
3 Questions to ask in Case Prep
How much do they want to leave for their heirs? What is the purpose of each asset (asset location worksheet)
400
The two potential policy changes that are illustrated in the "Guaranteed" Columns of Table II in the illustration
What are 1) Interest rate is decreased to the guaranteed 3% floor, and 2) Cost of insurance is increased to the maximum allowable levels?
400
The tax benefit(s) lost when a life insurance policy becomes a MEC
What is Tax free withdrawals and loans?
400
This life insurance strategy helps ensure a fair and equitable distribution of an inheritance to multiple family members, especially when real estate or business assets are being passed on to one or two family members, but not to all.
What is Estate Equalization?
400
The most common after-tax account type held by clients in the "Tax Later" column of the Asset Location Worksheet that may be systematically repositioned to a life insurance policy in the "Tax Never" column to help protect a legacy.
What is an After-Tax-Annuity?
400
Best Practices in Case Prep
Life Insurance Scavenger Hunt Questions with Retirement Review Send an illustration request to IIC while in the prep with the advisor, IIC follows up before client meeting and reviews illustration with Advisor.
500
The spread between a policy's cash value and the policy's death benefit
What is Corridor of Risk or Amount at Risk?
500
This occurs when a client inadvertently makes a premium payment that exceeds the seven-pay premium
What is The premium is not processed. The client receives a letter asking them to first acknowledge that they are aware that the policy will become a MEC. No client can accidentally create a MEC without their written or verbal consent?
500
"Your estate is optimized. If you were to pass away today, I assure you that your estate is liquid, tax-efficient, fair and balanced to your beneficiaries, and is perfectly protected to meet your wishes."
What is The message we silently send clients every time they leave a trusted WMA's office without discussing our life insurance capabilities?
500
The process of relocating assets or cash flow to a life insurance policy to specifically protect a clients desired ending capital goals. This includes providing the client with the a "stop loss" and a "downside hedge"
What is Legacy Risk Management?
500
How have you introduced life insurance as a part of the Annual Review?
Leverage the Life Insurance Annual Review Checklist!