Preview 2 10 Marketing Opportunities in 10 Minutes PruLife® SUL Protector Key Benefits Brief Overview of Marketing Materials [Resources and Tools] Not for Consumer Use.
Market Opportunities 3 10 Marketing Opportunities Ideas in 10 Minutes Net Worth Ultra High Net Worth & High Net Worth Affluent, Emerging Affluent, and Middle Market Parameters $10M+, $5M+ (if single)$500k to $10M (5M, if single) Focal Opportunities Federal Estate TaxState Estate / Inheritance Tax, if any State Estate Taxes, if anyIncome in Respect of a Decedent (IRD) Advanced Transfer Techniques Estate Equalization GST / Dynasty TrustEnhancing Gifts to Children & Grandchildren Charitable GivingIncome for Children in Dual Income Households Children Not Party to Business Succession Planning Special Needs Planning Charitable Giving Not for Consumer Use.
Marketing Opportunity 1 4 Dynasty Trust and Multigenerational Trust Planning The SUL Protector Solution: Generally for high- and ultra-high net worth families ($10MM - $25MM+). Dynasty trusts - multigenerational irrevocable trusts, usually funded with life insurance. Clients fund the trust through cash gifts—sometimes in the millions of dollars. After receiving the gift(s) of cash, the trustee can purchase life insurance— often, SUL Protector to provide death benefit to the trust upon the death of the second insured. The trust often provides funds in perpetuity to the succeeding generations. Why? Because your clients want to pass their wealth on to the generations that follow. And because of the increased federal estate tax exemption and generation skipping tax exemption. Not for Consumer Use.
Marketing Opportunity 2 5 Federal Estate Tax The SUL Protector Solution: Generally for high- and ultra-high net worth families ($10MM to $25MM+, less if single) Clients may choose to establish an Irrevocable Life Insurance Trust (ILIT) to hold life insurance outside of their estates. SUL Protector is attractive because it pays the death benefit after the second spouse passes away, which is generally when federal estate taxes may apply. *The federal estate tax applicable exclusion amount for 2014 is $5.34 million Why? Because Federal estate tax may be applicable for clients with an excess of $5.34 million in net worth or $10.68 million for married couples*. Not for Consumer Use.
Marketing Opportunity 3 Not for Consumer Use.6 State Estate/Inheritance Taxes The SUL Protector Solution: Helps offset the costs of these taxes to their heirs. The generally income-tax free death benefit (according to IRC § 101(a)*) is paid upon the death of the second insured to provide funds to pay the taxes. An ILIT may purchase the SUL Protector policy to keep the insurance policy outside the clients’ estate. *There are some exceptions to this general rule, including certain changes in ownership and payment of any additional interest at death. Why? Because state estate taxes and/or inheritance taxes imposed on the right to inherit assets may be an issue. Even though clients may not have a FEDERAL estate tax obligation – they need to consider potential STATE tax obligations.
Marketing Opportunity 4 Not for Consumer Use. Income in Respect of Decedent (IRD) The SUL Protector Solution: Provides additional funds to their heirs to be used to pay the IRD taxes. The death benefit is generally income-tax free which makes it even more attractive. Why? Because when an heir inherits an IRA or 401(k) retirement plan, the heir must pay income taxes when withdrawals are received. 7
Marketing Opportunity 5 Not for Consumer Use.8 Estate Equalization The SUL Protector Solution: Generally, for clients who have more than one child, regardless of net worth. For example, one child may live close to home, while another lives far away. In such a situation, the clients may give a home or a parcel of land to the child living close to home and may wish to give an equal-valued inheritance to the child who moved away. The beneficiary of the SUL Protector policy would be the child who is not going to inherit the home or parcel of land. They receive the death benefit which will have an equal monetary value as the home or land that is inherited by their sibling. Why? Because equalizing inheritance is a common concern that is NOT related to estate tax planning.
Marketing Opportunity 6 Not for Consumer Use.9 Enhancing Gifts to Children and Grandchildren The SUL Protector Solution: Clients can gift money to a trust which, in turn, purchases an SUL Protector policy in an appropriate amount. Generally, notwithstanding the time value of money, the gift that had been given to the trust and used to buy the SUL Protector policy will be lower than the amount that will be paid out as the death benefit. By having the trust purchase the SUL Protector policy, the clients will be able to leave a larger gift to their heirs. Why? Because clients may want to leave a larger inheritance to their children and grandchildren. This way, they can maximize their funds and protect it, too.
Marketing Opportunity 7 Not for Consumer Use.10 Income for Children in Dual-Income Households The SUL Protector Solution: Provides replacement income when it’s needed most. Replaces the income after the second parent or income- provider dies to allow the children to continue to live as they’ve been accustomed. Why? Because children living in a dual-income household have a lifestyle that relies on both incomes.
Marketing Opportunity 8 Not for Consumer Use.11 Children Not Party to Business Succession Planning The SUL Protector Solution: Similar to estate equalization reasons for buying an SUL Protector policy. Provides a death benefit to the child or children who will not inherit the business. The death benefit can provide monetary value equivalent to the business, thereby giving all heirs an equal share. Why? Because some children don’t want to be part of a family business and yet are entitled to share in equal inheritance.
Marketing Opportunity 9 Not for Consumer Use.12 Special Needs Planning The SUL Protector Solution: Generally for clients who have children with special needs, regardless of net worth. Special needs planning generally refers to the necessity of establishing a trust for children, including adult children, who have special needs. As in all cases involving trusts, clients must consult with an attorney who has experience in special needs planning. The trust must be properly drafted to ensure it does not negatively impact the child’s right(s) to other services (e.g. governmental assistance, etc.). Survivorship universal life (SUL) is often used to fund special needs trusts. Why? Because SUL Protector may be an appropriate way to provide guaranteed maximum funding for a special needs trust for a reasonable cost in terms of premium.
Marketing Opportunity 10 Not for Consumer Use.13 Charitable Giving The SUL Protector Solution: SUL Protector may be selected as a way to fund a charitable gift. One way is for the clients to own the policy and name the charity as the beneficiary. Another way, as an alternative, the client may gift the premium to the charity on a periodic basis. The charity, in turn, would be the owner and beneficiary of the policy and use the client gifts to pay the premium. Why? Because some people want to leave a charitable legacy but don’t want it to be diminished by estate taxes.
SUL Protector Key Benefits Not for Consumer Use.14 Prudential remains committed to the lifetime secondary guarantee marketplace for SUL Protector—even as other companies have exited. SUL Protector is in the Top Quartile for Single Pay as well as Full Pay. Exceptional capacity—$20 million retention, $65 million automatic issue limit on second-to-die policies. Conversion of two Prudential term policies to one SUL Protector policy is permitted.* SUL Protector is a great play in strategies for estate planning, wealth transfer, special needs, and a variety of other markets. Age Last Birthday continues to be a strong advantage. SUL Protector can help you expand your business into advanced market areas and our elite advanced marketing team can help you win big cases. * We allow conversion to survivorship policies at the companies’ discretion—we may discontinue the practice at any time.
SUL Protector Marketing Materials Not for Consumer Use.15 Marketing Material PruLife ® SUL Protector Fast Facts (0157547) Competitive Information (0213278) Pru’s Life Insurance Product Portfolio Brochure (0168315) "10 Sales Opportunity Ideas in 10 Minutes” (0199636)
Modeling Calculators 16 Introduction Modeling Calculators Flyer (0235746) Modeling Calculators Highlighter (0234405) Estate & Gifting Strategies Wealth Strategies Planner (0203650) Estate Tax Calculator (0193238) Estate Tax Examples (0198162) Gifting Analysis with Flowcharts (0162702) Business Strategies Business Strategies Planner (0218177) Estate Equalization Calculator (0199933) Retirement Strategies Retirement Distribution Analysis (0175524) Asset Protection + Calculator (0255926) Personal Strategies Human Life Value Calculator (0231607) Life Quick Estimator (0217699) BenefitAccess Rider Calculator (0254300) BenefitAccess Rider Calculator (0261304-CA) Human Life Value Calculator (0231607) Charitable Giving Life Ins. Estimator (0250950) Basic Survivor Needs Analysis (0234306) Survivor Needs Analysis (PDF only 0234306) For Calculators, look for our Modeling Tools eKit, or go to pruxpress – producer resources – tools – financial calculators.
Important Note Not for Consumer Use.17 PruLife SUL Protector 2011 is issued by Pruco Life Insurance Company in all states except New York, where it is issued by Pruco Life Insurance Company of New Jersey. Both are Prudential Financial companies located in Newark, NJ. Each is solely responsible for its own financial condition and contractual obligations. All guarantees are backed by the claims-paying ability of the issuing company. Securities and Insurance Products: Not Insured by FDIC or Any Federal Government Agency. May Lose Value. Not a Deposit of or Guaranteed by Any Bank or Bank Affiliate. Use of this material with the public is prohibited. It is intended for producer/broker use only. Prudential, the Prudential logo and the Rock symbol are service marks of Prudential Financial, Inc. and its related entities.
Next Steps Not for Consumer Use.18 1.Re-examine when and how you present SUL 2.Consider "modeling" different scenarios for key cases with the help of the calculators. Contact [Prudential Life Wholesaler or your ABC General Agent] for additional information. 3.For a full range of robust marketing materials and supporting product information, visit pruxpress.com.