Advisors Blog

Find The Right Fit - Hybrid LTC

The majority of people will need long-term care (LTC) at some point during their lives, and the costs can be significant.

Hybrid LTC offers your clients an efficient way to plan for these potential expenses. The included LTC coverage carries a death benefit that protects premiums paid from loss if LTC benefits are not needed.

IRS Nixes 10-Year Stretch For Most Inherited IRAs

A lot of inherited IRA owners are in for a surprise. In a switcheroo, the Treasury Department has reinstated annual required minimum distributions for most folks who’ve recently inherited Individual Retirement Accounts, according to proposed regulations released late last month that interpret the 2019 retirement law known as the SECURE Act. IRA experts are still poring through the 275 pages.

What we know so far is this: If you inherited a traditional IRA or 401(k) account in 2020 or later, watch out because the rules have changed—again.

“The IRS is interpreting the SECURE Act’s 10-year rule differently than what everybody thought,” says Ed Slott, a CPA and IRA expert in Rockville Centre, N.Y.

This article is being provided as a service to you. Please note that the information and opinions included are provided by third parties and have been obtained from sources believed to be reliable, but accuracy and completeness cannot be guaranteed by GBS Insurance and Financial Services, inc. Financial Professionals should ensure they continue to follow the current policies on the use of any advertising, third-party materials and/or social media as required by your broker/dealer and/or the carriers that you represent.

Stress Testing

Universal Life - No Lapse Guarantee -Missed Premium

Male, Age 65, Preferred Risk Class, $1,000,000 Death Benefit.

Improving Your Underwriting Win Probability

There have been significant changes in how insurance carriers assess (and ultimately price) life insurance risks. Factors propelling these changes include restrictive reinsurance treaties; concerns regarding the long-term impact of a pandemic on life expectancy; and increased insurer reliance on artificial intelligence.

The most successful financial professionals realize that they must reinvent their underwriting processes in order to improve their opportunity for success.

Use IRA Dollars to Fund Asset Care

You probably know some clients who have IRAs, 401(k)s or 403(b) accounts. For a lot of your clients, qualified funds—IRAs, 401(k)s, or 403(b)s—may be their most substantial financial assets.

Repositioning qualified money into the Asset Care Annuity Funding Whole Life solution can provide your clients and their spouses with a 20% income base bonus and efficient Long-Term Care protection that lasts as long as they need it with the Lifetime Continuation of Benefits option.

Increased Commission and New Select-a-Term Rates, Effective May 23, 2022

AIG has increased the street level commission on the 10-Year Select-a-Term! To confirm your commission schedule please log into Connext and find your schedule, under Contracting & Commissions, and Agent Lookup.

Also effective May 23, 2022 there will be premium rate changes in all states except New York, where rates will remain the same.

Index Annuity Rates are Improving Effective Monday, May 23, 2022

Effective May 23, 2022, AIG has made the following annuity rate update

Agile Underwriting+ (AU+) helps you grow your business and cover more clients

Speed through IUL cases for MORE clients with HIGHER protection!

AU+ is AIG's streamlined underwriting process that’s available for issue ages up to 59, risk classes from Standard to Preferred Plus, and face amounts up to and including $2 million!

PLUS - Applications submitted for AU+ are often issued in five days! That makes the buying experience simple and fast for you and your clients.

Update to AIG L&R AML Training Requirements

Effective immediately, any financial professional appointed with an AIG Life & Retirement business now has a 2-year window to renew their AML training, dating back to the last date of AML training completion.

Secure Act 2.0

The House of Representatives recently passed the Secure Act 2.0. The act is meant to encourage more saving by individuals as too many individuals reach retirement without having the savings they need to comfortably retire. The bill builds on the previous Secure Act to enhance retirement. Click below to read more about what the bill will include.

Interest Rate Updates - June 1, 2022

Effective June 1, 2022, Cincinnati Life has made the following interest rate changes.

Update Regarding Business-Owned Insurance in New York

John Hancock has received approval for updated application forms (NB5000NY (02/2022) & NB5037NY (02/2022)) for use in the business-owned insurance market in New York. In light of this update, they began accepting applications effective May 23, 2022. Please note, John Hancock will continue to NOT allow any employer-owned policies where employees contribute premium to the policy. Please see the additional administrative requirements for these types of policies below:

Party responsible for providing notices

For employer-owned policies, the employer is responsible for providing the required notice and consent to employees and such notice and consent are prepared by the employer.

Premiums

Premiums must be non-contributory. John Hancock will not accept any employer-owned policy that includes any employee contributions made either at or after issue.

Use of individual forms

All policy forms must insure an individual and have an attached application for that insured. 

New guide to John Hancock Variable Insurance Trust

One of the standout value propositions of John Hancock’s VUL products is the access they provide to a broad, diversified offering of portfolios — from our select roster of talented and knowledgeable asset managers. Use this guide to learn more about those offerings and our unique multi-manager approach.

Take It to the Next Level With These Underwriting Sweet Spots

Legal & General provides one simple journey, with instant, accelerated, lab-free experiences based on eligibility and availability.

Benefits of accelerated underwriting program:

• Real-time decisions with instant approvals (or within a few hours
• Over 50% of cases approved without the need for exams 
• More clients covered, faster 

As of August 1st, LGA will no longer accept traditional paper life insurance applications (LIA)

Last month, we reached out to you with important news affecting those advisors using the traditional paper LIA (ICC08-LIA and state variations) to submit business for Banner (non-NY) business.  

Highlights included:

• Introduction of an alternative application to the traditional paper LIA — a new LIA (ICC17-LIA and state variations for CA, DE, FL, ND, SD) that is accessible in the Forms section of LGA's Partner Dashboard 
• Overview of changes made to their traditional application process until they retire the traditional paper LIA  

Effective August 1, LGA will no longer accept the traditional LIA (ICC08-LIA and state variations). As of this date, these forms will no longer be accepted. All applications must be submitted with either the new LIA or the digital application through their Horizon platform.

Click below to review and download their FAQs, process map including pro tips for making this transition easily, and Horizon marketing resources.

Coming Soon: Lincoln VUL^ONE (2021) – Pricing Updates Effective June 13, 2022

Effective June 13, 2022, Lincoln is announcing pricing updates on Lincoln VUL^ONE (2021) which will improve competitive positioning of level pays, while remaining competitive in single pay designs. Lincoln VUL^ONE (2021) – 06/13/22, a variable universal life insurance product, continues to offer a lifetime guaranteed death benefit with market-driven growth potential, as well as a second Guaranteed Minimum Death Benefit (GMDB) option that for a lower premium provides 100% protection to age 90, and 50% GMDB protection thereafter, regardless of how the market performs.

Pricing Changes

Pricing adjustments apply to both GMDB options (Lifetime guaranteed and GMDB drop at age 90) and will vary by age and funding pattern. On average adjustments are as follows:

• 17% decrease to Level pay designs
• 1% decrease to 10 pay designs
• 5% increase to single pay designs 

Real-Time Offer for Life Insurance

Beginning June 13, 2022, Lincoln is excited to provide you and your clients with a Real-Time Offer for cases that have been approved lab-free by our automated underwriting process.

What is “Real-Time Offer”?

To improve turnaround times for life insurance ticket submissions, Real-Time Offer will immediately communicate an approval decision to eligible clients, the writing agent, and case contact after the online or phone interview is completed.

The approved underwriting offer may be ‘as applied for’ or ‘other than applied for.’ The underwriting rate class will only be provided to the agent and case contact. If labs or other information is needed, or if the case is declined, the agent and case contact will be notified through Lincoln’s standard pending case status process.

What You Need to Know

Available for life insurance ticket submissions only:

• Lincoln TermAccel®
• LincXpress® submissions (single-life only): Lincoln LifeElements® Term, IUL, VUL*

Ages: 18-60

Face Amounts: $2.5 million and less

Underwriting criteria:

• Only available for cases assessed through the automated underwriting process
• Client must be approved lab-free
• Good Health Statement and Insurability Supplement is not required for cases approved via Real-Time Offer

MassMutual raising premium limits for ALIR and similar riders - June 1st, 2022

MassMutual is raising premium limits for the Additional Life Insurance Rider (ALIR). Effective June 1st, the limits will be:

• $5 million using the 10:1 rule: ALIR payments up to $5 million can be made provided the payment is no more than 10 times the base policy plus LTCAccess Rider annual premiums.
• $3 million using the 20:1 rule: For 1035 exchanges, ALIR dump-ins up to $3 million can be made provided the payment is no more than 20 times the base policy plus LTCAccess Rider annual premiums.
• For 1035 exchanges, loans carried over from the old policy to the MassMutual policy will be treated as an unscheduled ALIR payment and subject to the maximum limits above. In some cases, this may require additional evidence of insurability and/or the client to pay out-of-pocket money if there is not enough 1035 value going into the policy to cover the loan being carried over.
• These limits also apply to the Life Insurance Supplement Rider (LISR), as well as the Survivorship Additional Life Insured Rider (ALIRS) and Survivorship Life Insurance Supplement Rider (LISRS) available on second-to-die whole life policies. These are aggregate limits for these riders and apply across all policies on a given insured.

New MassMutual Whole Life 12-Pay Coming August 20, 2022 

Whole Life 12-Pay, a new lower-premium alternative to Whole Life 10-Pay, will be available in August in most jurisdictions using EZ-app initially and Haven Technologies’ Coverpath digital platform in the future. The product provides death benefit protection and cash value accumulation with the potential for competitive income solutions. Survivorship Whole Life 12-Pay will debut concurrently, with more details to come.

Whole Life 12-Pay features, benefits, prospects, and sought-after options:

Whole Life 12-Pay will have a 3% guaranteed interest rate and the same features as MassMutual’s other limited pay products. Benefits include:

• Guaranteed amount of paid-up life insurance.
• Guaranteed cash value increases yearly.
• Total death benefit and total cash value that never decline in value.

Prospective consumers for Whole Life 12-Pay will be affluent, high-net-worth clients, ages 45-55, who want life insurance to protect income, accumulate additional funds for retirement, and better manage market risk. The product can help them tackle financial concerns including tax-efficient accumulation, legacy/wealth transfer planning, and health care/long-term care planning.

LTCAccess Rider (LTCR) will be available with Whole Life 12-Pay at launch. Chronic Illness Rider (CIR) will not be available with Whole Life 12-Pay at launch; however, CIR is available with MassMutual Whole Life Insurance products on Haven Technologies’ Coverpath digital platform.

Key dates

Important dates in the Whole Life 12-Pay and Survivorship Whole Life 12-Pay rollout:

• June 1: Whole Life 12-Pay illustrations available on MassMutual Designs (MMD) and WinFlex Web.
• July 1: Survivorship Whole Life 12-Pay illustrations available on MMD and WinFlex Web.
• Aug. 20: First day to submit applications for both products on EZ-app

IULs Made with Simplicity in Mind 

Life Protection Advantage^SM, Mutual of Omaha's protection focused IUL, offers coverage projected to age 120 at competitive premiums, and an option to guarantee coverage to age 90. Income Advantage^SM, their accumulation focused IUL, builds competitive cash values¹ due to its lower charge structure, and has strong index loan provisions. 

Both IUL products offer:

• A Simple Product Design
• Three Index Interest Crediting Strategies
• Competitive Participation Rates and Caps
• An Index Loan Option with a Cap
• A guaranteed Refund Option
• Early access to the death benefit for Long-Term Care, Terminal and Chronic Illness

Nationwide IUL Accumulator II 2020 Enhancements available now! 

In case you missed it, Nationwide is excited to share product changes to their popular Nationwide IUL Accumulator II 2020, bringing you new volatility control index options to help limit the impact of market volatility. The enhancements also include new interest strategies, the highest par rates they've ever offered, higher target premiums, a new credit, and more.

Interest Rate Changes - June 15, 2022 

New business interest rates for some OneAmerica^® Care Solutions products are changing effective Wednesday, June 15, 2022.

• Annuity Care^® LTC fund rate and Indexed Annuity Care^® rates are increasing.
• All other rates remain the same.

Note: All products may not be available in all states or may vary by state.

Protective Classic Choice Term Reprice, Effective June 6, 2022 

Protective is excited to announce they've lowered their Protective^® Classic Choice term prices once again. And with longer term periods, more flexibility and faster technology, they’re also making short-term business easier and more innovative.

Transition Rules:

• For paper business: applications must be signed and received on or before June 20, 2022.
• For ticket business and direct writer: applications must be signed and received on or before July 4, 2022.
• Any application in Underwriting on June 6, 2022, may choose the version of the product (old or new) but will retain the rates they are initially quoted unless otherwise requested up until the case has been approved.
• New York does not have a rate change; however, the plan codes are changing so they will follow the above rules.

Plus, you can create more ideal client experiences with Protective Velocity – their suite of digital solutions that makes submitting business fast and hassle free.

Fund Changes Effective in June 2022 

There will be two fund mergers and two fund names will change effective in June.

Symetra Annuities Interest Rate Update - Effective June 1, 2022 

Effective June 1, 2022, Symetra has made the following annuity interest rate update.

A dynamic pair providing strong growth potential and market volatility control 

Can life insurance provide death benefit protection, attractive policy cash value potential for future financial needs, and avoid unwanted surprises? With Symetra Accumulator Ascent Indexed Universal Life (IUL), their new uncapped Putnam Dynamic Low Volatility Excess Return Index Strategies (Putnam Index Strategies) can provide even stronger policy growth potential with a focus on managing volatility that could affect your client's policy value.

Exclusive to Symetra, their Putnam Index Strategies are based on the Putnam Dynamic Low Volatility Excess Return Index (Putnam Index), which pursues attractive returns through a combination of low-risk U.S. stocks, U.S. government bonds and cash, and dynamically adjusts its allocations to pursue a consistent volatility of 5%.