Winning The Life Insurance "Game"

How to make the application process work for you. Provides advice for people with specific risk factors, such as medical conditions and adventurous hobbies, on how to obtain coverage at a reasonable rate.

Honoring Your Parents: Do You Know How to Die?

honoring parents how to die

Do you know how to die? That’s probably not a question you get asked every day. Most people don’t want to think about it, and I can’t say I blame them. While those in dangerous occupations, such as police officers or soldiers, are forced to deal with the reality of death, the rest of us tend to put it off until a terminal illness or other tragic event occurs.

When people decide to buy life insurance, they are, in some way, acknowledging the fact that they will die. But very few consider how they will die. The clients with whom I have broached this subject with often brush it off with a sarcastic or humorous response, which is one way to avoid the more serious side of the issue.

In my career as a life insurance salesperson, I have expedited many death claims. I also accompanied both my parents in the final stage of their lives, helping them make their final preparations. One critical lesson I have learned from this experience is that how you die is very much a result of how you live. The more peace you have found in this lifetime, the more peace you will have when you leave it

Here are three ways in which a peaceful life can lead to a peaceful death:

Get Your Financial House In Order

Nobody wants to deal with money issues. If you make financial mistakes when you are young, you have the luxury of time to recover from them. But when you are old, your capability of generating new income is limited. When you enter the last stage of your life, you don’t want it to be fraught with financial worries.

What does it mean to plan ahead and prepare? Think through a big-picture blueprint for all of your assets to protect your investments, your legacy, and most importantly, your loved ones, then start taking steps to get all the pieces in place.

Find Peace With Those Around You

When people realize their last day is coming, they understand they are out of second chances. There is no time left to tell people how you feel or to apologize for your misdeeds. You don’t want to die with regrets and remorse on your conscience, so get in the habit of clearing your slate with those in your life. If you owe someone money, make sure you pay off the debt in full. If you owe someone an apology, give it immediately. Delaying may only result in running out of time.

Set The Stage For A Comfortable Transition

It’s crucial for people to feel that they are in a good, safe place with the right relationships, the right job, the right school. Don’t settle for less by sticking it out in an uncaring environment. This will be especially important to you in the final stage of your life.

I have found that people really care about where they die. Both my parents were adamant about not ending their life in a nursing home. They wanted to die at home, in familiar surroundings, amongst caring people. Because it was a priority to them, my family made sure it happened the way they desired. As an example, one of the most inspiring stories I’ve heard was of a gentleman who spent almost his entire life in one home, tending a luscious garden for many years. When he knew that his final day had arrived, he simply walked into that garden, his favorite place, and lay down. That is where his wife found him.

As a life insurance sales person, family member, and friend, I feel it is my duty to help people set the stage for their passing as comfortably as they can. That often means helping them decide how to live comfortably, with peace of mind and confidence in their plans. If you or your loved ones have never considered the question of how you will die and know that you have some missing pieces to take care of, contact me at skobrin@stevenkobrin.com. I am happy to help you make the most of your life.

About Steve

Steven Kobrin is a life insurance expert with 25 years experience. He serves high net-worth individuals and business owners as well as high risk and uninsurable “impaired cases.” Steven offers concierge life insurance process to ensure the policy is approved as it’s quoted. To learn more, visit his website, read his blog, connect with him on LinkedIn, or request a policy audit today by calling his office at (866) 633-1818 or by email at skobrin@stevenkobrin.com. Steven is a contributor to Investopedia, view his profile here.

 

Want to learn more?
Read my free guide, How To Get Great Life Insurance Rates and learn how you can get life insurance companies to compete for your business, at no risk or extra cost.

How Business Owners Use Life Insurance to Provide Bonuses to Selected Executives

how-bus-owners-bonuses

As a business owner, you invest copious amounts of time, money, and energy into your employees. Don’t you want your investment to pay off? Employee turnover can be extremely costly to your business, and this is especially true when it comes to key executives.

The Cost To The Business

When you lose indispensable employees, money has to be reallocated to provide for recruiting, training, orientation, and management of a new hire. It can also take a lot of time to ensure that you find someone who is the best fit for the role. The longer the recruitment process takes, the more the business is exposed to a setback.

This is why companies spend significant amounts of money on compensation packages for key executives. The longer they can get these men and women to stay in their employment, the better return they get on their investment in them. Employers are always looking for benefits that can be legitimately offered to selected personnel only. How does life insurance fit into this equation?

Life Insurance As The Answer

Life insurance is frequently at the top of this selected benefit list. If a number of factors fall into place, then the use of this product can be a big win for both the executive and the firm. Here are some factors that will ensure the success of life insurance for this purpose:

  • The executive has a need for life insurance for personal reasons, such as family protection and retirement planning.
  • The executive qualifies for a policy that can provide both significant cash accumulation and a sufficient survivor benefit.
  • The executive is willing to let the firm control policy proceeds.

If your executives meet these criteria, what are some tips to take into consideration?

1. The Importance of Underwriting

The lower the cost of the insurance, the higher cash value and survivor benefit a policy will provide. If the executive qualifies for a comparatively low rate, then additional money can be paid into the policy for use in retirement, as well as for the protection of beneficiaries. If the executive has a chronic illness or another higher-risk factor that drives up the cost of coverage, a policy may still be a worthwhile bonus from the employer. Be sure to contact your life insurance provider to talk through any extenuating circumstances and how they could affect the policy.

2. Seek Advice On Premium Payments


The whole point of this benefit is for the employer to subsidize the cost of a life insurance policy that can have a major impact on the life of the executive. Because these policies can cost substantial amounts of money, the employer will take on a considerable expense in financing them. Make sure your financial experts talk to your insurance advisor about how to minimize the tax impact for both your firm and your executive.

3. Implement Sensible Policy Controls


The primary purpose of providing this benefit is to lock executives into a commitment that protects the business. What kind of stipulations can be applied to ensure the benefit pays off? One option is to build controls into the executive’s contract that give access to increased policy benefits over time. Secondly, provisions can be made to reimburse the employer for their expense while still providing the executive with a lucrative cash account and survivor benefit. Speak to your business advisor to review your options in this regard.

You build your business to be successful and a major piece of that success is in holding onto key personnel. Don’t overlook the importance life insurance can play to ensure loyalty from your chief executives. I am here to answer your life insurance questions and help you find creative ways to protect your business. Ask anything by emailing me at skobrin@stevenkobrin.com.

About Steve

Steven Kobrin is a life insurance expert with 25 years experience. He serves high net-worth individuals and business owners as well as high risk and uninsurable “impaired cases.” Steven offers concierge life insurance process to ensure the policy is approved as it’s quoted. To learn more, visit his website, read his blog, connect with him on LinkedIn, or request a policy audit today by calling his office at (866) 633-1818 or by email at skobrin@stevenkobrin.com.

 

Want to learn more?
Read my free guide, How To Get Great Life Insurance Rates and learn how you can get life insurance companies to compete for your business, at no risk or extra cost.

How Business Owners Use Life Insurance to Make Charitable Gifts

Money - The best present

What is one trait that successful business owners share? An attitude of gratitude! Business owners who have advanced in their field don’t forget those who helped them get to the top. They honor their parents, they give credit where credit is due, and they see the importance of every contribution to the cause, whether from the janitor or the CEO.

On top of that, they also value and appreciate charities and the work they do. It might be that the business owner was touched and assisted by a religious congregation. Maybe a family member benefited from the services of a medical research group, hospital, or home care facility. Many business owners support universities or advocacy groups. Regardless of the reasons or the particular charities, they often desire to give back to the organizations that made a difference in their life. Other than donating funds from time to time, how can successful business owners give back in a way that will significantly impact the charities they choose?

Using Life Insurance to Give Back

Life insurance is ideally suited for charitable giving. By taking out a policy on yourself for the benefit of the charity, you can turn a small amount of money into a substantial gift. Each dollar of the benefit only cost pennies in the original investment. This means that the gift does not have to be an excessive expense for the donor, but the investment adds up and the charity’s cash flow is considerably impacted.

Here are three quick tips for business owners for using life insurance to make charitable gifts:

Familiarize Yourself With The Legalities

Make sure you understand the laws regarding the use of life insurance for charitable giving. Many states recognize that charities have an insurable interest in contributors. They realize that these organizations can be as dependent on donors as businesses can be dependent on key personnel. Work with an attorney who can guide you on the best way to structure the policy and help you answer the questions of who should be the owner, beneficiary or premium payer.

Get Creative With Permanent Life Insurance

The life insurance policy you are gifting will be part of your estate plan, and thus must last as long as you do. That means you need permanent life insurance. But just because the policy will last your lifetime doesn’t mean you have to pay for it for your entire life. You can design the policy so you can make one single payment, payments for ten years, or even payments for twenty years, yet still retain a lifetime guarantee. Work with your broker to generate some options and pick the one that best meets your financing preferences.

Work With a Team

Collaborate with your fellow contributors to maximize the benefits to the charity. The healthy charity is the one that receives support on an ongoing basis. Long-term contributions could be generated for a charity if donors of all different ages took out policies for its benefit. Year after year after year, big dollars could roll in as donors pass on and benefits are paid out.

Generous business owners can increase their donations to their charities by using life insurance. By naming a charity as a beneficiary, you can give that charity an extraordinary amount of money that can create a lasting legacy for a cause that is important to you. If you are interested in contributing to a life insurance policy for the benefit of a charity, I’d love to walk you through the process and answer any questions you may have. Ask anything by emailing me at skobrin@stevenkobrin.com.

About Steve

Steven Kobrin is a life insurance expert with 25 years experience. He serves high net-worth individuals and business owners as well as high risk and uninsurable “impaired cases.” Steven offers concierge life insurance process to ensure the policy is approved as it’s quoted. To learn more, visit his website, read his blog, connect with him on LinkedIn, or request a policy audit today by calling his office at (866) 633-1818 or by email at skobrin@stevenkobrin.com.

 

Want to learn more?
Read my free guide, How To Get Great Life Insurance Rates and learn how you can get life insurance companies to compete for your business, at no risk or extra cost.

What I Do and How I Can Help

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Do you want to know what sets me apart from other businesses? I am dedicated to putting my clients’ best interests first and making the life insurance process streamlined and clear. My passion is to ensure that my clients have the best coverage possible and find a plan that works for each and every unique situation that comes across my path. My firm goes above and beyond the norm to find policies for even the most difficult of cases.

How Important is Life Insurance?

Because of my experience, commitment, and specialization, I have been fortunate to work with a wide range of clients who refer their friends and family to me. I have a strong desire to help others and see them succeed. Many people do not realize the significant value of having life insurance or they do not believe life insurance is available for or applicable to their situation.

Life insurance is one of the key pieces for your financial future. Without it, your business may suffer or your family may not be taken care of. Let me help you find the best insurance for you and give you confidence and peace of mind for your family and investments. If you have a friend or family member who has questions or needs unbiased advice and guidance along their life insurance quest, please take the time to share the below information. If you’re a client and you’ve enjoyed working with me, I hope you’ll refer a friend, colleague, or family member who may benefit from my expertise and high-quality service. Learn more here.

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Want to learn more?
Read my free guide, How To Get Great Life Insurance Rates and learn how you can get life insurance companies to compete for your business, at no risk or extra cost.

How Business Owners Use Life Insurance to Protect Against the Loss of a Key Person

As any business owner knows, when it comes to running a company, everyone counts. You can’t bring in money without a salesforce. You can’t count the money without an accounting department. You can’t run the computers without an IT specialist.

You can’t secure the building without security personnel. And you can’t keep the floors clean without the maintenance staff. The same goes for every clerk, administrator, secretary, supervisor, manager, and executive. Your business runs on the shoulders of many people in a variety of positions. Have you made sure that the loss of a key player won’t harm your business?

Why Do You Need This Coverage?

While everyone is integral, some people play principal roles. For example, revenue may suffer if you lose a top salesperson, and investors and shareholders might get anxious if you lose a chief executive. Clients and vendors might get nervous if a key manager leaves, and future production may be jeopardized if you lose a key technician, inventor, scientist, or idea person.

These situations show why businesses insure leading personnel. They take out life insurance to protect themselves against the loss of men and women whose death could impair the operation. The insurance benefit protects you by giving you the time needed to recruit the right replacement. In the meantime, client service continues, bills get paid, and employees have reassurance that the show will go on. Business can take place as normal.

Here are three quick tips for business owners to make the right decisions when insuring key personnel.

Determine the Policy’s Face Amount

How do you value the services of primary employees? Your answer to that question will vary according to the role they play. The service of a key chief executive would be assessed differently than the service of a key technician. Your firm’s accountant or chief financial officer should consult with an insurance company advisor to calculate the appropriate insurance benefit for your situation.

Decide on a Time Period

Key person coverage came about at a time when the main employees tended to make long-term commitments to their employers. Today, many key men and women tend to switch jobs more frequently. If you think that is the case in your business, then term insurance might be more applicable than permanent insurance.

Establish Your Options

What should you do with the policy on a vital person if he or she does leave? You have a number of options to choose from. You could simply terminate the policy, or, if it is a cash value policy, you might be able to surrender it for value. In some cases, the former employer keeps the policy in force and collects the benefit when the former employee passes away. The policy may also be sold for cash in a life settlement depending on the age, medical condition of the insured, and other factors related to the policy.

Your business is built on the shoulders of all those who work for you. How protected are you if one of your principal players passes away? I’d love to hear from you and answer any questions you may have. Ask anything by emailing me at skobrin@stevenkobrin.com.

About Steve

Steven Kobrin is a life insurance expert with 25 years experience. He serves high net-worth individuals and business owners as well as high risk and uninsurable “impaired cases.” Steven offers concierge life insurance process to ensure the policy is approved as it’s quoted. To learn more, visit his website, read his blog, connect with him on LinkedIn, or request a policy audit today by calling his office at (866) 633-1818 or by email at skobrin@stevenkobrin.com.

 

Want to learn more?
Read my free guide, How To Get Great Life Insurance Rates and learn how you can get life insurance companies to compete for your business, at no risk or extra cost.

What the NY Times DIDN’T Tell You About Universal Life Insurance

NewYorkTImes

A recent article in the business section of the New York Times levels some pretty severe criticism of insurance companies. In particular, it reports on alarming increases in the premiums of some universal life products. It not only details how these high costs are placing many families in financial jeopardy but also highlights the lawsuits that are currently being launched in protest against certain companies. From my point of view, the reporting is, unfortunately, accurate, and the criticism merited.

But it is only half the story. And the other half makes all the difference. First, a little background.

A Product With Two Ledgers

Universal life insurance is a permanent product. It can last as long as you do. Most importantly to know, it is designed with two sets of values: guaranteed and non-guaranteed. Guaranteed values are exactly that: a death benefit, premium, and cash accumulation that are contractually guaranteed. Regardless of the investment performance, cost of doing business, and amount of claims paid, the policy will provide these numbers as long as the insured sticks to the payment schedule.

Non-guaranteed values are also exactly as their name implies: a death benefit, premium, and cash accumulation that are projections based on certain assumptions. Variations in investment performance, cost of doing business, and the amount of claims paid can affect the numbers provided by the policy, even if the insured sticks to the payment schedule.

A Sales Process With Full Disclosure

For decades, life insurance company have taken great pains to make sure that consumers understand the difference between these two ledgers. They are painfully aware of how people can get confused, or simply forget what they bought. They also know that life insurance sales representatives are not always the best at explaining the intricacies of these complicated products. So, they have implemented a number of full-disclosure requirements to ensure that clients know what they are buying. Chief among these is an illustration that portrays the premium-payment schedule to which the client has committed and the values that can be expected to accrue going forward, both guaranteed and non-guaranteed. The client signs off on this illustration when they accept the policy.

What Happens When Company Expectations Are Not Met

Insurance companies, like all businesses, make assumptions about costs and profits going forward. And, like all businesses, they have to adjust to changing circumstances. When a life insurance company experiences unexpected losses or increases in costs, they are compelled to make up the difference somehow. One area they typically target is the non-guaranteed ledger in universal life policies. They can legally, and legitimately, raise the price to restore profitability.

This is exactly what is being reported in the New York Times article. And so we have the shock and dismay of policyholders who forgot this could happen, who never realized it could happen, or who knew it was coming but still don’t like it. But what the paper doesn’t tell you is that those policyholders who have employed a payment strategy based on guarantees are completely unaffected by poor business performance. Companies are required to meet the contractual guarantees, so they do.

Now let’s look at some of the points raised by the article, but also include the other side of the story.

Guaranteed Premiums Remain Unchanged

People who bought universal life policies in the 1980s and 1990s, some of which guaranteed annual returns of 4 percent or more, are seeing their premiums soar.

This is true, but only non-guaranteed premiums are increasing. Guaranteed premiums are staying the same. Due to the increased cost, the policy might not last as long on a guaranteed basis, but, this would only be true if the consumer did not buy a policy with a lifetime guarantee. If the lifetime guarantee is there, then the policy will last a lifetime at the guaranteed premium, regardless of the company’s annual return.

Existing Policyholders are Secure

In the United States, in the hopes of staving off a reckoning, some insurers have stopped selling particular products and have raised the price policyholders must pay for some existing policies.

True. Some companies have stopped selling universal life with guarantees. But those consumers with current policies can keep them, and the contractually-guaranteed premiums are not being raised.

Guaranteed Cash Values are Reliable

Universal policies typically cost more, but the coverage never expires, and the buyer gets both a fixed death benefit and a “cash value” account, designed to earn tax-exempt interest. Money in the account can be used to help pay the policy’s premiums. But there is a risk. If the account gets used up paying those costs, the policy can lapse, and coverage ends.

Universal policies typically cost more than what, term insurance? Sure they do. If you want the company to guarantee the premium for a longer period of time, they’re going to charge you more. But we are not comparing permanent life insurance to term insurance here. The fact of the matter is that universal life typically costs less than whole life insurance, which is one reason why people buy it.

Despite the lower premium, some people will still depend on cash accumulation to offset the cost of coverage. If their non-guaranteed interest assumptions fall short, then they may run out of cash and lapse the policy. However, if they were banking on guaranteed cash accumulation, they will not have the risk of the contract under-performing. Their coverage will not lapse.

What You Can Do

Here is the bottom line: if you bought a universal life policy based on guarantees, you have absolutely nothing to worry about. All the alarms being raised by this New York Times article do not apply to you. If you have a policy designed with interest assumptions that are falling short, then you may have a problem. But you know what? You very well may be eligible for a product from another company that could give you the guarantees you need at a reasonable price. Thankfully, it’s a big marketplace out there, and good values are still available for a great many people. I’d love to hear from you and answer any questions you may have. Ask anything by emailing me at skobrin@stevenkobrin.com.

About Steve

Steven Kobrin is a life insurance expert with 25 years experience. He serves high net-worth individuals and business owners as well as high risk and uninsurable “impaired cases.” Steven offers concierge life insurance process to ensure the policy is approved as it’s quoted. To learn more, visit his website, read his blog, connect with him on LinkedIn, or request a policy audit today by calling his office at (866) 633-1818 or by email at skobrin@stevenkobrin.com.

 

Want to learn more?
Read my free guide, How To Get Great Life Insurance Rates and learn how you can get life insurance companies to compete for your business, at no risk or extra cost.

How Business Owners Use Life Insurance to Fund Partnership Agreements

PartnershipAgreementsIt’s a common practice for business owners to take on partners. While there are many reasons behind why you may want to take this step, there are also some crucial things to consider when entering into a business partnership. What legal bases do you need to cover? How can life insurance protect you, your business, and your family?

What a Partnership Looks Like

Some business owners enter a partnership because they need someone to complement their personal strengths. For example, one person could be an expert in operations, the other in sales and marketing. Sometimes professionals with the same area of specialization will join together to serve more clients. In other arrangements, one partner could be passive and responsible primarily for funding, while the other is the active manager of the enterprise.

The partnership could and should be a very structured relationship. A legal agreement should be formulated and should cover all the financial technicalities such as the percentage of ownership, tenure of the partnership, how and when the business is to be valued, etc. It should also plan for events that may dissolve the partnership, such as the death, disability, long-term sickness, or early retirement of a partner.

How Life Insurance Can Help

Life insurance plays a key role in the funding of a partnership agreement. When a partner dies, that person’s spouse or estate will probably end up with his shares of the business. The surviving partners want those shares, but they need money to buy them. Life insurance can provide the exact amount of money to do that at the exact time it is needed. It is typically a much more economical way taking care of things compared to other options such as taking cash out of the business, selling assets, or borrowing from a bank.

What are some integral pieces to consider when using life insurance to fund your partnership agreement?

Finalize Your Agreement

Before you do anything else, get the arrangement finalized before you get approved for your policy. There is nothing worse than getting approved at a great rate, only to delay paying for the policy because the legal work has not been completed. Until it is, you won’t have coverage, and something disastrous could happen that could either raise the price significantly or disqualify you altogether.

Costs Will Vary

Remember that not everybody qualifies for the same price. Each person represents a different risk profile to a life insurance underwriter. Age, gender, smoking status, health history, and a multitude of other factors affect the rate. Don’t expect life insurance to cost the same for each partner.

Explore Your Options

Research your options for policy ownership. In some instances, your business should be the owner and the beneficiary of the policies. In other cases, partners should own policies on one another. Talk this through with your business advisor to make sure your policies are issued correctly and fit your needs.

Life insurance is critical for business owners. It covers you, your business, your partner, and your families, and can be a game changer if the unexpected occurs. Don’t get caught without it. I’d love to hear from you and answer any questions you may have. Ask anything by emailing me at skobrin@stevenkobrin.com.

About Steve

Steven Kobrin is a life insurance expert with 25 years experience. He serves high net-worth individuals and business owners as well as high risk and uninsurable “impaired cases.” Steven offers concierge life insurance process to ensure the policy is approved as it’s quoted. To learn more, visit his website, read his blog, connect with him on LinkedIn, or request a policy audit today by calling his office at (866) 633-1818 or by email at skobrin@stevenkobrin.com.

 

Want to learn more?
Read my free guide, How To Get Great Life Insurance Rates and learn how you can get life insurance companies to compete for your business, at no risk or extra cost.

How Business Owners Use Life Insurance to Protect Their Families

BusinessOwners

Owning your own business has many perks and can bring plenty of freedom and success. You may have started a business because you like your independence or you wanted to get rich. You may like a challenge or simply want to build a better mousetrap or mop. Maybe you believe you can make the best pie, or computer, or automobile, and want to share your passion with the world. But will your business alone be enough to take care of your family in the future?

Taking Care of What’s Important

For many of us, owning a business is simply a way of living the good life, following a dream, and providing the best for our families. We desire to become independently wealthy and do what we want with our time. Since we are devoted to our spouse and children, we want to make sure our surviving family members can maintain the same standard of living even if we meet our tragic demise prematurely. As business owners, we often make provisions so our business can at least partially subsidize this ideal life in our absence.

However, the business usually cannot fully care for your family in the manner in which they have become accustomed. The full range of family financial needs, such as income replacement, mortgage protection, and retirement supplementation, cannot be met through the business alone. There is usually not enough to cover college funding or elder care for senior parents who become dependent, along with regular life expenses. As a result, life insurance is typically used to pick up the slack.

So how can you, as a business owner, ensure that your family is covered? Here are three quick tips for business owners for using life insurance to take care of their families.

Use Separate Policies

In many cases, the owner and beneficiary of a personal policy are different than for a business policy. A trust may be utilized, and a separate policy is therefore needed.
A personal life insurance policy will provide for your family and their future, while a business policy can provide for a buyout if your business has multiple partners. Make sure all your policies are separate and up-to-date so that there is no confusion or legal hold-ups if a tragedy occurs.

Use Multiple Policies

Most personal financial needs have different timelines. You may need 20 years to plan for college, but 40 years to plan for retirement. Separate policies with various face amounts and different guarantee periods can be employed to provide the exact sum of money for specific needs and further ensure that every aspect of your family’s life is taken care of. Take the time to look at all your family’s needs and determine what is necessary to provide for each one.

Beware of Tax Traps

Business owners like to have the business pay for everything. This practice can be very convenient and beneficial, but you need to know what you’re doing when it comes to taxes. You don’t want to get into a tax mess by using the wrong account for your life insurance payments. Get good tax advice from the right professional and cover your bases.

As a business owner, are you making sure that your family is taken care of? Do you know what type of life insurance you need and how to go about planning for your family’s care? I’d love to hear from you and answer any questions you may have. Ask anything by emailing me at skobrin@stevenkobrin.com.

About Steve

Steven Kobrin is a life insurance expert with 25 years experience. He serves high net-worth individuals and business owners as well as high risk and uninsurable “impaired cases.” Steven offers concierge life insurance process to ensure the policy is approved as it’s quoted. To learn more, visit his website, read his blog, connect with him on LinkedIn, or request a policy audit today by calling his office at (866) 633-1818 or by email at skobrin@stevenkobrin.com.

 

Want to learn more?
Read my free guide, How To Get Great Life Insurance Rates and learn how you can get life insurance companies to compete for your business, at no risk or extra cost.

The Basics of Premium Financing

The Basics of Premium Financing

What Is Premium Financing?

Premium financing is basically just borrowing money to pay life insurance premiums. High-net-worth individuals and companies use this strategy to obtain large amounts of life insurance with a minimal upfront expense. It is a means to retain capital by only paying interest on a loan that pays premiums instead of paying the actual premiums.

How Does It Work?

First, you need to set up an Irrevocable Life Insurance Trust (ILIT). This trust will hold the life insurance policy and pay the loan interest. Upon your death, the insurance proceeds are paid to the ILIT. Once the trust has paid off the loan, the rest of the funds will be distributed to your heirs.

After application and approval, a third-party lender loans money to the trust. The ILIT then uses the borrowed money to pay premiums to the insurance company. The trust also must make interest payments on the loan. You, the insured, will need to gift the trust the money to pay the interest. Gift taxes may be assessed on the funds that you give the trust.

Whether or not you or your ILIT obtains the loan, you are responsible for providing the collateral. Usually, you must post collateral equal to the difference between the cash surrender value of the policy and the loan balance. Collateral requirements are set by the lender, though, so sometimes the actual value of the collateralized assets can be greater than the loan.

Why Do People Use Premium Financing?

Many different kinds of people take advantage of premium financing. Sometimes they are owners of thriving businesses who do not want to stunt the business’s growth by withdrawing capital. Sometimes they are high-net-worth individuals who simply do not want to reduce their current cash flow. Sometimes they are people with vast real estate holdings with no interest in liquidation. Sometimes they are very profitable investors, not wanting to cash out their lucrative investments and pay the capital gains taxes.

No matter their situation, people use a premium financing strategy because they need life insurance for inheritance, business or tax issues, but they want to keep the funds that they would have to spend on premiums in more profitable investments.

Premium Financing Example

Here is a fictitious example of premium financing that illustrates the benefits of leverage and the opportunity cost involved:

John wants to buy life insurance with a $100,000 premium. His assets are currently invested and earning 10% returns. He has two options. He can finance the premiums at a 5% interest rate or he can cash out some of his investments to pay the premiums.

Option 1: Premium Financing

John takes the loan at 5% interest, so his interest payment is $5,000. He is left with $95,000 growing at 10%. At the end of the year, he has $104,500, which continues to grow year over year.

Option 2: Self Funding

Instead of financing the premiums, John opts to pay them himself. The $100,000 that he pulls out of investments had been earning 10%, so it is a $10,000 opportunity cost. Because he liquidated an investment, he also must pay capital gains taxes. Instead of pulling out $100,000 he has to pull out $120,000 to cover the cost of the taxes as well. Now, aside from the $10,000 opportunity cost, paying the premiums himself has cost him an additional $20,000.

Which option seems like a better financial decision for John? Which option might be best for you?

If you’re interested in learning more about premium financing or discussing if it’s the right strategy for you, email me at skobrin@stevenkobrin.com.

About Steve

Steven Kobrin is a life insurance expert with 25 years experience. He serves high net-worth individuals and business owners as well as high risk and uninsurable “impaired cases.” Steven offers concierge life insurance process to ensure the policy is approved as it’s quoted. To learn more, visit his website, read his blog, connect with him on LinkedIn, or request a policy audit today by calling his office at (866) 633-1818 or by email at skobrin@stevenkobrin.com.

 

Want to learn more?
Read my free guide, How To Get Great Life Insurance Rates and learn how you can get life insurance companies to compete for your business, at no risk or extra cost.

Follow Your Practice, Not Your Passion

FollowYourPractice

Is passion the key to success? If you attended one of the many college graduations taking place these days, you’d think so. Every year around this time, impressionable graduates are encouraged by the commencement speaker to follow their passions. Don’t pursue a career for practicality or financial stability. As long as you follow your dreams and love what you do, you’ll never work a day in your life.

And we don’t just hear this at graduation ceremonies. When actors win Academy Awards or musicians win a Grammy, more often than not they preach to their fans (who are often aspiring stars) to never give up on their dreams. It’s a charming notion, but is it also naive? Will following our passion, regardless of what it takes, put us on the road to happiness, fulfillment, and everything we want out of life?

Passion vs. Ability

TV personality, Mike Rowe, emphatically answers, “No!” The author of “Dirty Jobs” and “Somebody’s Gotta Do It,” Rowe divulges the real deal about the role of passion in a short and sweet webinar he hosted through Prager University. If you don’t want to watch the webinar yourself, I’ll summarize it in a nutshell: passion and ability have nothing to do with one another, and ability is what really counts when you want to achieve anything in life.

I agree with Rowe’s opinion, and I think it rings true for everyone, whether they’re new grads entering the job marketplace, professionals rebuilding their careers, or successful entrepreneurs and empire builders. Passion is great to have, and it can help you stick it out during the rough times. But without ability, passion can’t take you all the way. Your ability can improve with practice and hard work, but ability is necessary, nonetheless.

When I started out in the life insurance business, I had to develop a sales practice from scratch. I cold-called prospects I picked out of a phonebook. I went door-to-door to hundreds of businesses around the county. Was I passionate about calling complete strangers or knocking on the doors of businesses day after day? Of course not. But this was the first step of starting a life insurance practice. I had to get into the practice of picking up the phone and knocking on doors. Pick up the phone, knock on the door. Pick up the phone, knock on the door. Eventually, I got better at it, started seeing results, adjusted my strategies based on what worked, and I eventually learned to like it. Today, I love my career and am proud of the success I’ve achieved over the years.

The Path to Success

I’m not the exception to the rule. Take a look at how any successful person reached their status. When I was in high school, my idol was Jim Ryun, the youngest guy to ever run a four-minute mile. I was a runner myself, and I read his autobiography to learn how he trained. He shared how he had to drag himself out into the heat, rain, cold, and snow for his morning workout, and then repeat the exact same schedule after school. Day after day after day. Eventually, he got better at it, started seeing results, adjusted his strategies based on what worked, and learned to like it.

What about the the time artists have to put in to become masters? Whether it’s martial arts, performing arts, or visual arts, artists have to practice their craft hundreds of thousands and millions of times, step-by-step, note by note, stroke by stroke. In the book, “Outliers,” author Malcolm Gladwell claims that the key to achieving expertise in any skill, is a matter of practicing the correct way, for around 10,000 hours total. That’s a lot of hours. But eventually, you get better at it, start seeing results, adjust your strategies based on what worked, and learn to like it.

Mike Rowe has it right: never follow your passion, but always bring it with you. Find an opportunity and prosper. Stick with it, and with enough practice and perseverance, things will fall into place for you and you’ll learn to love it.

Where do you fall in the passion versus ability discussion? What do you think matters most for achieving success? Hard work? Inherent skill? Luck? A little bit of everything? Drop me a line and let me know your thoughts. I’d love to discuss with you!

About Steve

Steven Kobrin is a life insurance expert with 25 years experience. He serves high net-worth individuals and business owners as well as high risk and uninsurable “impaired cases.” Steven offers concierge life insurance process to ensure the policy is approved as it’s quoted. To learn more, visit his website, read his blog, connect with him on LinkedIn, or request a policy audit today by calling his office at (866) 633-1818 or by email at skobrin@stevenkobrin.com.

 

Want to learn more?
Read my free guide, How To Get Great Life Insurance Rates and learn how you can get life insurance companies to compete for your business, at no risk or extra cost.

Why I Love Selling Life Insurance

Whylifeinsurance

I have been in the life insurance business for 25 years. In a time when people are constantly changing careers or trying to find their niche, a quarter of a century is a long time to stick with something, grow, and succeed. I believe that the reason I have found success and fulfillment in my life’s work is because I know my “why”.

In other words, I know why I am doing what I am doing. I have a goal and a purpose behind what I do. I don’t just go to work, day in and day out, slogging through my tasks like so many others do. The driving purpose behind my work gives me vision and helps me help others. Here are some reasons for my dedication and commitment to my calling in the life insurance business:

1. It’s a Family Tradition

My father, Leon Kobrin, of blessed memory, was a life insurance agent in the 1950s, 60s, and 70s. I grew up working in his firm and saw firsthand what the job entailed. I worked there from grade school through college and because of this experience, the life insurance business became part of my DNA.

My father acted as a role model and mentor to me. He taught me how to conduct business, and he shared his wisdom and the lessons he learned from his experience. He also mentored me in sales and marketing. Most importantly, he drove home the purpose of this product: to allow people to take care of the people they love.

Selling life insurance has become much more than a job to me. It has become a way to continue the family legacy of helping people take care of their loved ones.

2. It’s a Path for Choosing My Own Destiny

After I graduated college, I held a number of sales and marketing positions, and eventually ended up as the operations manager of a computer supply distributor. This job gave me a solid grounding in business operations.

During my time with the company, I also developed a keen sense of how mergers and acquisitions can impact your career. Sure enough, the business was sold and I was let go. My Plan B at the time had been to get back into sales, where I could rise and fall by my own merit.

Of course, the life insurance industry was a natural place to go, given my upbringing and prior experiences. At the time, I would rather have the pressures of self-employment than the stress of working for people who didn’t give a hoot about my career. I still think this way, and I count my blessings that America is the land of opportunity for people who want to steer their own ship through life’s waters.

3. It’s a Way to Do Good

It is important to me that the work I do makes a difference. I want my job to have a positive impact on people’s lives. I can’t think of a better way to do this than to make sure our widows and orphans have the money they need to not only survive, but retain their independence.

Life insurance is also sold for other reasons, such as funding business partnership agreements, covering key executives, paying estate taxes and other debts, and making important gifts to charities. All of these needs for life insurance share one thing in common: a desire to preserve and protect that which we hold most dear. I feel privileged to be able to help thousands accomplish this efficiently and economically.

4. It’s a Challenge

Selling life insurance is enormously competitive. There is someone licensed to sell life insurance on almost every block. This includes other independent brokers, captive agents, property and casualty brokers, accountants, bankers, stockbrokers, investment advisors, and wealth managers. Ads for instant quotes permeate the Internet, TV, and radio. You can’t join any senior organization, professional association, and alumni or fraternal establishment without getting solicited for guaranteed coverage.

Those of us who are determined to succeed in such a competitive environment must be at the top of our game. Every part of our practice, from our business model to our marketing plan to our product knowledge, has to be world-class. This takes time, money, and the perseverance to offer the highest level of service.

5. It’s Allowed Me to Specialize

I believe that part of my success has come because I specialize in one product and master it: life insurance. By being an expert in a narrow field, I have established myself as a specialist that other professionals turn to when they need help getting their clients life insurance.

When other brokers turn people away because of the high medical or lifestyle risk they represent, I get the policies these people need. And while other brokers submit applications and hope for an approval, I prequalify my candidates and give them the confidence of an approval at the rate quoted.

Because I love what I do, it’s both an honor and a privilege to be in a position to serve so many people. Do you know your purpose behind what you invest your time, money and energy in? What would you change if you could? Do you have a question about life or life insurance? Ask anything by emailing me at skobrin@stevenkobrin.com.

About Steve

Steven Kobrin is a life insurance expert with 25 years experience. He serves high net-worth individuals and business owners as well as high risk and uninsurable “impaired cases.” Steven offers concierge life insurance process to ensure the policy is approved as it’s quoted. To learn more, visit his website, read his blog, connect with him on LinkedIn, or request a policy audit today by calling his office at (866) 633-1818 or by email at skobrin@stevenkobrin.com.

 

Want to learn more?
Read my free guide, How To Get Great Life Insurance Rates and learn how you can get life insurance companies to compete for your business, at no risk or extra cost.

Three Tips for Securing Life Insurance for a Divorce Settlement

If I Could Teach One Financial Lesson, What Would It Be- (4)We’re all aware of the scary statistic that 40 to 50% of married couples in the United States divorce. Yet, many people don’t also realize that divorce reduces a man’s standard of living by 10% and a woman’s by almost 30%.

For these reasons, among others, it’s essential for couples to understand how life insurance plays into a divorce settlement. This is especially the case since insurance is an often neglected area of financial planning, since many people don’t realize it’s an important risk management and wealth accumulation tool.

When people go through a divorce, life insurance is often required. This can add to an already stressful situation. The purchase has to be made in a timely fashion, which can be difficult when a couple is already under so much pressure. The premium must also be reasonable since a considerable amount of money is being spent on the settlement. And, if either spouse has a high-risk medical condition or hobby, obtaining coverage might appear difficult or impossible. Yet despite all this, the agreement can’t be finalized without a policy. Yikes!

Fortunately, you can make your purchase less troublesome. Here are three tips for making the process as smooth as possible:

1. Get Prequalified for Coverage

Your broker should quote you the most appropriate company, product, and price before you submit a formal application. You should be able to go through underwriting feeling confident with an approval at the rate quoted.

In order to do this, he or she must pre-underwrite you and identify all of the underwriting challenges you pose. Only then can the most competitive carrier be selected. Not only that, the selected carrier must commit to a rate assuming the information collected in underwriting does not contradict the preliminary disclosures.

Prequalification sets the stage for more than a satisfactory outcome. It also helps underwriting move faster because any issues that can potentially cause delays have already been addressed.

2. Finalize All Legal Documents

There is nothing worse than having an underwriter approve your application at the rate quoted, but you can’t have the policy issued because your legal documents aren’t in order. These documents are important because they secure your legal and financial interests. They can influence the ownership of the policy, the manner in which the benefit is distributed, and how any cash in the policy would be accessed.

If your divorce decree, the life insurance trust, the bank account, and all other tools are not in place, then the coverage cannot go into force and you run the risk of an emergent medical condition, lifestyle change, or other factor making you ineligible for coverage or disqualified entirely. This can severely complicate any divorce agreement.

3. Keep Things Simple

When people typically engage in life insurance planning, they like to look at the big picture. They prefer to identify all the potential needs for coverage – personal, business, charitable. They then formulate an overall strategy for meeting these needs. This allows them to choose a policy or policies that are the most cost-effective.

Sometimes, however, we develop single needs for life insurance. A policy to meet the obligations of a divorce decree is an example. It is usually easier to take out a policy for this purpose that is separate and distinct from the policies that meet your other needs. It is also very often in your own interest to keep the policy for your former spouse separate from the ones for your current (or prospective) new spouse. You don’t want others controlling the coverage, accessing cash, or receiving a benefit to which they are not entitled.

It may seem like life insurance can further complicate an already complicated and emotional divorce settlement, but it’s a critical element for both spouses’ financial futures. Along with your divorce attorney, work with an independent life insurance specialist to help you make appropriate decisions and answer the many questions you may have along the way.

Do you have a question about life insurance or how major life events can affect a policy? Send me an email at skobrin@stevenkobrin.com and I’d be happy to chat with you.

About Steve

Steven Kobrin is a life insurance expert with 25 years experience. He serves high net-worth individuals and business owners as well as high risk and uninsurable “impaired cases.” Steven offers concierge life insurance process to ensure the policy is approved as it’s quoted. To learn more, visit his website, read his blog, connect with him on LinkedIn, or request a policy audit today by calling his office at (866) 633-1818 or by email at skobrin@stevenkobrin.com.

 

Want to learn more?
Read my free guide, How To Get Great Life Insurance Rates and learn how you can get life insurance companies to compete for your business, at no risk or extra cost.

What To Do When Your Term Insurance Renewal Rate Spikes

TermInsurance

There’s a good chance that when you first purchased a term insurance policy, you were focused on finding a low-cost insurance policy. You were just starting a family, buying a house, and stretching your money thin due to other financial demands. So, you purchased a low-cost 15-year term policy. Now, it’s 15 years later, you still need life insurance, and you still have financial demands, but now your policy’s renewal premium is significantly higher than when you first purchased.

Unfortunately, this isn’t an uncommon situation. There are a number of reasons why your policy’s premium amount increases. The biggest reason is age. On average, a premium amount increases between 8% and 10% for every year of age. Every life insurance carrier has underwriting requirements that usually include health tests, and the older you are the more tests that are required.

Beyond age, the policy carrier may also be concerned about its reserves or the availability of credit. One insurance company was facing insolvency, and to avoid declaring bankruptcy, they realized they needed to reduce future liabilities. This meant they needed to eliminate a number of their policies. The best way to do this was to increase policy premiums in order to encourage some policyholders to cancel. Although the court ultimately ruled against the insurance company, this still remains the thought process for some companies.

If your term insurance premium has significantly increased when it comes time to renew, you do have options. Start by getting pre-qualified for life insurance to see your other options and what other policies for which you are eligible. This typically involves a complete medical exam and, depending on your age, the type of policy, and the amount of coverage, a carrier could request additional tests, such as treadmill test or EKG. You may discover that based on your age, health, and other factors that your premium renewal rate is on par with other quotes, or you may find you can obtain a different policy for much less.

As you shop around for different policies, consider a permanent life policy to avoid having to go through this ordeal again. Many term insurance policies can be converted or exchanged for a permanent life policy, including Whole Life and Universal Life, with no additional underwriting required. Whatever you choose to do, make sure you obtain another policy before cancelling your current one.

As I stated earlier, the unfortunate truth about term insurance is that the premium can significantly increase when it comes time to renew. If you are currently considering term insurance, consider your needs beyond the policy limits, whether it’s 10 or 30 years. You may discover permanent life is a better option for your needs. If you already have a term policy that is approaching its renewal date, start looking into alternative policies now so you can be prepared and know your options.

If you have questions about term insurance or would like a second opinion on a life insurance quote you have received, please call me (866) 633-1818 or send me an email at skobrin@stevenkobrin.com. I also encourage you to download my free Life Insurance Guide, which you can see in the above tab.

About Steve

Steven Kobrin is a life insurance expert with 25 years experience. He serves high-net-worth individuals and business owners as well as high risk and uninsurable “impaired cases.” Steven offers concierge life insurance process to ensure the policy is approved as it’s quoted. To learn more, visit his website, read his blog, connect with him on LinkedIn, or request a policy audit today by calling his office at (866) 633-1818 or by email at skobrin@stevenkobrin.com.

 

Want to learn more?
Read my free guide, How To Get Great Life Insurance Rates and learn how you can get life insurance companies to compete for your business, at no risk or extra cost.

Does Life Insurance Cover Acts of Terror?

Untitled design (40)

By Steven H. Kobrin, LUTCF

Insurance companies inevitably have a role to play during times of war. People tragically die, and get hurt. Property gets destroyed. Business is interrupted. Once people get through the grief and terror, they need to move on. They need money. Bills have to get paid. They need to know the insurance company will come through for them and pay every dollar of the benefit deserved. And quickly.

Under the terms of the ordinary life insurance contract that you and I have, war is not excluded. Neither are acts of terror. So yes, the beneficiaries of those poor victims in France, and for that matter in America, Israel, India, and all over the world, should get their insurance payout.

That money certainly will not compensate for their loss, nor will it bring justice to the perpetrators. But it will help them keep their lives stable, and to move on as they can.

It must be noted that some people do have life insurance policies with exclusions. These exclusions can include acts of war and terror. These policies are typically issued by excess-market carriers to people whose occupation or lifestyle could expose them to such hazards. One example could be an engineer who works for a construction company that operates in war zones.

But these people, and their families, know upfront they might not get paid. For the rest of us folks who have policies with no exclusions, one cause of claim is as good as the other. That’s a small consolation when tragedy strikes, but it is nonetheless good to know the money will be there.

Please feel free to comment, or to contact me directly with a specific question.

If you need a quote now, or a second opinion on a quote you have received, the best thing to do is to call me toll-free at (866) 633-1818. Or email me at skobrin@stevenkobrin.com. I also encourage you to download my free Life Insurance Guide, which you’ll find in the above tab, as many people have found it to be extremely educational.

About Steve

Steven Kobrin is a life insurance expert with 25 years experience. He serves high-net-worth individuals and business owners as well as high risk and uninsurable “impaired cases.” Steven offers concierge life insurance process to ensure the policy is approved as it’s quoted. To learn more, visit his website, read his blog, connect with him on LinkedIn, or request a policy audit today by calling his office at (866) 633-1818 or by email at skobrin@stevenkobrin.com.

 

Want to learn more?
Read my free guide, How To Get Great Life Insurance Rates and learn how you can get life insurance companies to compete for your business, at no risk or extra cost.

Should My Child Be My Life Insurance Beneficiary?

Life Insurance Child

When men and women buy life insurance, they typically want to make sure the benefit will go to the beneficiary they designate. Is there any reason why a life insurance company wouldn’t follow your instructions?

Is Your Child Your Life Insurance Beneficiary?

Yes, if your minor children are your life insurance beneficiaries.  Unfortunately, this mistake is very common. Parents with their hearts in the right place name their child as the beneficiary to their policy. The problem is, insurance companies will not pay benefits to a minor.

Often, prospective life insurance buyers have not been educated on how to properly structure their policies. Generally, once a spouse is named as the primary beneficiary, policyholders designate that additional benefits go to their children. That money is intended to give the children a head start in life, to care for them, to fund college, and so on. With these aims, many parents list their children as contingent beneficiaries.

However, if both spouses were to pass away before a child is of legal age, most insurance companies will not write a check to a minor. That is true whether it is a small check for $5,000 or a big check for $5 million. The money must be paid to a responsible adult who has been designated by the insured as a recipient of the insurance benefit.

How to Avoid This Mistake

It’s important to work with a competent estate planning attorney and assemble your toolkit for estate planning. This should include a traditional will as well as a living will. You may also need to create a trust. Be sure to designate an executor for your estate and a custodian for your children. This executor would be responsible for carrying out your wishes according to your will.

It’s critically important to define which money goes to which party, and when. The designations of owner and beneficiary of your life insurance policy will be coordinated with your estate planning attorney. It could be that a trust is named the beneficiary or the executor of your estate or even the estate itself could be listed. This step becomes even more important if you have special needs dependents.

By working with an Estate Planning lawyer that you trust, you will get advice to structure your beneficiaries to ensure your wishes are carried out without delay. This way, the benefit of your life insurance policy will indeed go to the intended beneficiary.

Do you know who the primary and contingent beneficiaries are for your  life insurance policies? For more information, call my office at (866) 633-1818 or email me at skobrin@stevenkobrin.com.

About Steve

Steven Kobrin is a life insurance expert with 25 years experience. He serves high-net-worth individuals and business owners as well as high risk and uninsurable “impaired cases.” Steven offers concierge life insurance process to ensure the policy is approved as it’s quoted. To learn more, visit his website, read his blog, connect with him on LinkedIn, or request a policy audit today by calling his office at (866) 633-1818 or by email at skobrin@stevenkobrin.com.

 

Want to learn more?
Read my free guide, How To Get Great Life Insurance Rates and learn how you can get life insurance companies to compete for your business, at no risk or extra cost.

Has Your Success Been Worth the Sacrifice?

SuccessandSacrifice

When you look back on the successful outcomes in your life, have they been worth the pain? We all make sacrifices in our lives for the goals we place a high priority on including education, career, and family. We spend long hours at the office to pay for our dream vacations, but miss out on graduations in the meantime. Many of us have relocated to cities far from our families to pursue our callings. There’s no shortage of everyday choices to miss out on social opportunities in the name of discipline and routine. But how can we know if each choice strikes the right balance?

When you consider your life, do your accomplishments outweigh the value of the experiences you’ve missed? Of course, accomplishments may mean something different to you than they do to me. Perhaps you’re most proud of your children, or your boat, or your charitable endeavors. In any case, how would you answer today’s question?

Consider Your Accomplishments

When I reflect on this question, I can remember difficult and rewarding moments in life. Perhaps it wasn’t clear at every moment on my path, but looking back, my success has certainly been worth the pain, struggle, and sacrifice.

A few of my proudest accomplishments include:

  • Last summer, my wife and I celebrated our 32nd wedding anniversary. We are still going strong. Our son is on his own two feet, he married a wonderful woman and they have a darling little daughter.
  • I just turned 59 years old. I am healthy and strong enough in body and mind to train seriously in martial arts.
  • I am now in my 30th year of devoted religious study. It has been my pathway to better understanding God and the world He has created.
  • The year 2016 will mark my 25th year selling life insurance. I am in the process of retooling my business, starting with the publication of my first book.

Take a Look at the Opportunity Cost

However, these achievements that I hold dear did not come without hard work and lost opportunities. My life has included fair amounts of pain, struggle, and sacrifice. In a way, you could consider these to be the price of success. And of course, they have been worthwhile. What else could I ask for in life?

When I look back on the challenges I have faced, I prefer to look at them as investments in myself. There are times when I had to develop maturity, self-control, discipline, and emotional resilience. Beyond all of those attributes, the most important trait I’ve gained through life is humility. These are the qualities needed for success in all parts of life, both professional and personal.

What Does the Result Mean to You?

At my age, I am happy to have developed a mental toughness and resourcefulness that helps me deal with any and every challenge that comes my way. I feel I can be successful in anything I choose at this point. How could I put a price on that?

What about you? Have your challenges paid off? I’d love to hear your story. Do you have a question, about life or life insurance? Ask anything by emailing me at skobrin@stevenkobrin.com.

About Steve

Steven Kobrin is a life insurance expert with 25 years experience. He serves high net-worth individuals and business owners as well as high risk and uninsurable “impaired cases.” Steven offers concierge life insurance process to ensure the policy is approved as it’s quoted. To learn more, visit his website, read his blog, connect with him on LinkedIn, or request a policy audit today by calling his office at (866) 633-1818 or by email at skobrin@stevenkobrin.com.

 

 

Want to learn more?
Read my free guide, How To Get Great Life Insurance Rates and learn how you can get life insurance companies to compete for your business, at no risk or extra cost.

High Touch in High Tech

millWouldn’t you like hundreds and thousands of young people to be your clients?

Can you imagine how many prospects there are in their late teens, 20s, and 30s?

Think about it.

Decades of potential fees and commissions lie waiting in this demographic.

But the life insurance industry as a whole isn’t doing a very good job of reaching them, is it…

No worries.

It’s NOT about the sales pitch.

USA Today just laid it out for all to see.

Insurers are doing a poor job of reaching millennials:

Faced with slumping sales, life insurers throughout the developed world are targeting young adults for a massive infusion of little-risk income. Trouble is, their would-be customers distrust their objectives; see their products and sales methods as antiquated; and aren’t thinking about death, given their record life expectancies.

That kind of sums it up.

With such a horrible disconnect with their future customers, one would think that life insurance will go the way of the dinosaurs in just a few short years.

But the fact of the matter is that millennials will need life insurance for their families, their businesses, and their charitable pursuits.

And they will buy it from us brokers if we can modernize (meaning PERSONALIZE) our approach to them.

But personalize in a high-tech environment.

It IS about the people.

I am a second-generation life insurance salesman.

Believe me when I tell you that I know how to pitch the virtues of buying life insurance for peace of mind.

Doesn’t work here.

Let me tell you what will work:

  • Getting online. Sales people who can manage electronic relationships with their clients will be able to connect with them. Consumers who like to be wired can be contacted via wires. As hard as this may be to believe, face-to-face appointments with their vendors is just not that important. This may be a tough idea to swallow for those of us who were trained to make personal presentations, but it is true.
  • Your company is secondary. These are people who switch vendors for their internet connection, their smart phone, and all their other amenities at the drop of a hat. They switch jobs a lot.  Do you think it really matters that your insurance company is 100 years old? Or that their rating is A+ and not just A? If you come across as a company man, you will lose credibility.
  • Short-term is a good starting point. People with an expected mortality of over 100 tend to think that time is on their side. It is hard to relate to ideas like locking into long-term guarantees. Fine. So think short-term, get something in place, and build from there.

RELIEF = High Tech AND High Touch.

It seems that every time the life insurance industry comes across a problem like this, they start tinkering with their products.

Fine. That could help a bit. But it only goes so far.

The real tinkering should take place in our sales and marketing approach.

Insurance sales people need to restore the trust consumers once had in us.

We need to connect with people on their terms.

You’ve heard the saying, High Tech/High Touch?

Well, we need to be high touch via high-tech.

What do you think? How have you been able to reach millennials?

 

Want to learn more?
Read my free guide, How To Get Great Life Insurance Rates and learn how you can get life insurance companies to compete for your business, at no risk or extra cost.

Do You Have a Life Insurance Mentor?

This idea is not as strange as it sounds. I will tell you why. First of all, the life insurance marketplace is very complex. Hundreds of companies are licensed to sell policies. A wide variety of products are available, each with various bells and whistles. Which one it is right for you? Not an easy question.

Life insurance underwriting is hugely complicated. Think about all the factors that are considered: current health, personal medical history, family medical history, lifestyle, hobbies, travel habits, vocation, driving record, criminal record, financial record. I know of no other financial transaction that requires such scrutiny. Is your story a good one? Good enough to get a really good rate? Another good question.

One has to face his own mortality in order to be motivated to buy. People can purchase a home, a business, or any other household or business item – and even any other form of insurance – and the fact that they will die is incidental at best. With life insurance, you have to admit that it will happen. If you are smart, you will like acknowledge it could happen tomorrow. Who even wants to talk about death, let alone budget money to prepare for it?

It is a wonder that people ever buy this product. And yet, over several hundred years of history, a gigantic amount of people have done so. My question is this: was the process as easy for them as it should have been? Did they end up truly satisfied? You know as well as I do that the answer to both these questions is very frequently “no.” The experience was not as good as people would like. And for every consumer who felt dissatisfied, I am sure there are many more who aborted the process and didn’t get the coverage at all.

These issues must be faced when making any big purchase. A healthy combination of business savvy, negotiation skills, and values clarification are all needed to make a big move. They come into play when buying a house, buying a business, making a big investment, and buying life insurance. Who is available these days to help you make a smart decision?

From my point of view, the independent life insurance broker could be the best option. But it would take a certain breed of cat to get the job done. First of all, he has to be a life insurance specialist. If he is a generalist in that he sells many insurance and investment products, that will not suffice. The life insurance marketplace is extremely specialized, and only a specialist can master the field.

Secondly, he must view himself as your advocate. This means that he must believe in your insurability. He must know you to the point where it is clear to him that a good offer could and should be made at this time. He must then relentlessly network among his underwriting contacts to find an underwriter who believes the same. If at the end of the day that offer cannot simply be found, he must remain committed to finding you one the next time around.

Lastly, he must serve as a spiritual guide. This is not as lofty or as esoteric as it sounds. People need help thinking about and talking about major life issues. Fear and confusion is common. It is hard to talk about these topics with spouses, children, and business partners. People need to feel they are doing the right thing from both a financial point of view and also a moral point of view. After all, the insured will be dead when the benefit is paid out. People need support in reaching the point where they care enough about their legacy to fund it now.

There you have it. If the life insurance broker has developed the right set of skills and talents, he can help you make this all-important purchase with a smile on your face. Does your life insurance broker do this for you?

 

Want to learn more?
Read my free guide, How To Get Great Life Insurance Rates and learn how you can get life insurance companies to compete for your business, at no risk or extra cost.

Can I Get life Insurance With A Selfie Obsession?

People are going crazy with selfies. President Obama raised quite a stir with his selfie at Nelson Mandella’s memorial service. Then, baseball star David Ortiz raised a ruckus with his selfie at the White House. All harmless fun, however inappropriate.

But there is unfortunately a serious side to the this phenomenon. Some people are literally going crazy with them. As reported by Rebecca Savastio in Liberty Voice, selfies are now being linked to narcissism, mental illness, addictions and suicide. She refers to the tragic case of …

a man diagnosed with body dysmorphic disorder says he grew suicidal due to his addiction to taking selfies. Danny Bowman says he became so obsessed with trying to take the “right” selfie that he ended up shooting about 200 pictures a day while trying desperately to capture the perfect image of himself.

Wow. It sounds as if people can use some straight advice for using this technology without going overboard. Psychologist Pamela Rutledge makes some good points about this in her article for Psychology Today.

From a life insurance underwriting review, a selfie obsession could pose a new challenge. Let’s suppose the practice spins out of control, and medication or other forms of treatment become necessary. That could become an item the broker must address. The typical life insurance application has this question: “has the applicant been treated for chronic fatigue, stress, depression, anxiety, or any other emotional or psychological condition?”

If the answer is yes, then the broker must put that into proper perspective. The good news is that there are many underwriters who keep current on societal trends regarding mental illness. (I bet a number of them have a few selfies in their own phones). They should be willing to assess a very reasonable rate with the proper understanding.

Do you know people who have problems with selfies? Have they had trouble getting life insurance?

 

 

Want to learn more?
Read my free guide, How To Get Great Life Insurance Rates and learn how you can get life insurance companies to compete for your business, at no risk or extra cost.

Should My Life Insurance Pay for College?

One of the primary reasons why people buy life insurance is to pay for their kids’ college. Let’s suppose Mom and Dad have been putting away money for that expense. Tragically, one (or more horribly, both) meet an early demise. Life insurance would pick up the slack and complete the college fund for the surviving children.

For the past generation, this type of planning has been central to family finances. But these days, should it remain so? Here are some developments that could cause parents to think twice about sending their kids to college:

1. There are a multitude of blue-collar jobs that need to be filled.

A college degree may not even be necessary to make good money. Check out this interview with “Dirty Jobs” guru Mike Rowe by Nick Gillespie in Reason Magazine. To quote:

Rowe: You have right now about 3 million jobs in transportation, commerce, and trades that can’t be filled.

reason: This is anything from carpentry to being an electrician, a plumber, construction-

Rowe: Heating, electric, truck drivers. Welders is a big one. There’s a long list of jobs that parents typically don’t sit down and say to their kids: “Look, if all goes well, this is what you’re going to do.”

2. Many colleges have a bias against certain well-paying industries due to political ideology.

This means that even though these schools are supposedly committed to helping students launch careers, they may deliberately steer new graduates away from well-paying opportunities purely out of prejudice. See this assessment by Paul Tice in the Wall Street Journal:

Here is a college quiz. While many parts of the U.S. economy struggle to recover from the Great Recession of 2008-09, one domestic industry is experiencing a technology-driven expansion in which American innovations have led to countless new company startups, a surge in hiring and some of the highest-paying entry-level jobs for graduating college seniors.

How are the nation’s universities responding so students might prepare for a promising career in this growing and intellectually challenging field? By largely ignoring it. Why? Because the industry is oil and gas.

Is college for some people? Most certainly. But each child should be presented with all options, and informed about the realities of the marketplace for each. Some could end up in higher education, and others trade school. Still others could even start their own business. Everybody wins if the parents provide the counsel and the finances to support what is right for the individual child. And life insurance can secure that investment.

Does this make sense to you?

 

 

 

Want to learn more?
Read my free guide, How To Get Great Life Insurance Rates and learn how you can get life insurance companies to compete for your business, at no risk or extra cost.