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Presenter Name Maureen Baxter CLU, ChFC Lincoln Financial Distributors, Inc. AVP Marketing Programs For agent or broker use only. Not for use with the.

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Presentation on theme: "Presenter Name Maureen Baxter CLU, ChFC Lincoln Financial Distributors, Inc. AVP Marketing Programs For agent or broker use only. Not for use with the."— Presentation transcript:

1 Presenter Name Maureen Baxter CLU, ChFC Lincoln Financial Distributors, Inc. AVP Marketing Programs For agent or broker use only. Not for use with the public. ©2009 Lincoln National Corporation LCN LIF-GEN _LIF-PPT106 2/09 Find a better fit for your clients Life Insurance Professional Analysis and Review

2 For agent or broker use only. Not for use with the public. ©2009 Lincoln National Corporation LCN LIF-GEN _LIF-PPT106 2/09 2 Two separate companies issue Lincoln life insurance policies. New York policies are issued by Lincoln Life & Annuity Company of New York, Syracuse, NY. For all other states, policies are issued by The Lincoln National Life Insurance Company, Fort. Wayne, IN. These companies are separately responsible for satisfying their own financial and contractual obligations. Paramount principle Is your clients’ insurance up to PAR? What is the paramount principle of Professional Analysis and Review (PAR)?

3 For agent or broker use only. Not for use with the public. ©2009 Lincoln National Corporation LCN LIF-GEN _LIF-PPT106 2/09 3 Why offer PAR? How you can benefitHow clients can benefit Deepen relationships →Reassurance Perform due diligence →Insurance matching their needs Build your business →More loyalty for their advisor

4 For agent or broker use only. Not for use with the public. ©2009 Lincoln National Corporation LCN LIF-GEN _LIF-PPT106 2/09 4 Agenda What is PAR? What issues may be uncovered? Review PAR tools available at Lincoln Sample case solutions Questions

5 For agent or broker use only. Not for use with the public. ©2009 Lincoln National Corporation LCN LIF-GEN _LIF-PPT106 2/09 5 What is PAR? Who should receive a review? Anyone who owns life insurance, every 3 to 5 years

6 For agent or broker use only. Not for use with the public. ©2009 Lincoln National Corporation LCN LIF-GEN _LIF-PPT106 2/09 6 What is PAR? A life insurance needs analysis is appropriate for clients who Have changing needs for insurance Had a positive change in health status Own policies with loans, withdrawals, or other policy changes

7 For agent or broker use only. Not for use with the public. ©2009 Lincoln National Corporation LCN LIF-GEN _LIF-PPT106 2/09 7 What is PAR? A life insurance needs analysis is also appropriate for policyowners who Own term policies that may become expensive with age Own term policies and now have a need for permanent insurance Own policies in trusts that haven’t been reviewed in several years

8 For agent or broker use only. Not for use with the public. ©2009 Lincoln National Corporation LCN LIF-GEN _LIF-PPT106 2/09 8 The PAR process ReviewAnalyzeEvaluate Review the client’s current needs and purpose for life insurance. Interview the client Gather information using a Policy Evaluation Form Request in-force ledger for existing policies. Analyze premium and death benefit Compare in-force ledgers, policy provisions, guarantees, and other features Based on the data compiled: Evaluate the situation using the PAR software Determine if the existing amount and type of insurance meets the client’s need 123

9 For agent or broker use only. Not for use with the public. ©2009 Lincoln National Corporation LCN LIF-GEN _LIF-PPT106 2/09 9 Possible outcomes of PAR A Policy performing If existing policy is performing as expected or better, and needs have not changed... You are finished for now, and Continue to review periodically to be sure policy is on course. B Policy not performing If existing policy is not performing as expected or if needs have changed.. Determine a premium increase or decrease required to reach the goal. Work with the client to correct the situation. C Consider alternatives If appropriate, consider other solutions… Review additional insurance coverage options with your client. Explain why additional coverage may be suitable. Share illustrations with the client to help them make the decision.

10 For agent or broker use only. Not for use with the public. ©2009 Lincoln National Corporation LCN LIF-GEN _LIF-PPT106 2/ Review: PAR interview Why do you own this amount of insurance? Why did you buy this type of insurance? What was the primary purpose for buying this insurance? supplementing retirement family security college funding estate tax planning another purpose How much insurance will be in-force when needed?

11 For agent or broker use only. Not for use with the public. ©2009 Lincoln National Corporation LCN LIF-GEN _LIF-PPT106 2/ Review: PAR interview Do you have the appropriate type and amount of insurance to meet your primary goal? Cash accumulation vehicle Death benefit — maximum death benefit

12 For agent or broker use only. Not for use with the public. ©2009 Lincoln National Corporation LCN LIF-GEN _LIF-PPT106 2/ Review: what about term? Retaining term beyond conversion period Does this make good economic sense? What happens if your underwriting status changes? Can you requalify for the lower rates? Is the need for coverage temporary or longer term?

13 For agent or broker use only. Not for use with the public. ©2009 Lincoln National Corporation LCN LIF-GEN _LIF-PPT106 2/ Analyze: issues you may uncover Amount no longer appropriate for clients’ needs Change in clients’ needs or objectives Family situation has changed Client may have new goals Business need has changed Changes in lifestyle

14 For agent or broker use only. Not for use with the public. ©2009 Lincoln National Corporation LCN LIF-GEN _LIF-PPT106 2/ Analyze: issues you may uncover Clients own life insurance policies that Don’t have desired features –Secondary guarantees –Preferred Plus underwriting –Extended maturity Aren’t meeting clients’ current needs

15 For agent or broker use only. Not for use with the public. ©2009 Lincoln National Corporation LCN LIF-GEN _LIF-PPT106 2/ Analyze: issues you may uncover Some policies in danger of lapsing Taking multiple policy loans Making excessive withdrawals Not making premium payments Changing the face amount or death benefit More premium may be needed to fulfill the original goal

16 For agent or broker use only. Not for use with the public. ©2009 Lincoln National Corporation LCN LIF-GEN _LIF-PPT106 2/ Evaluate Reasons to keep current policy New surrender period Existing loans New acquisition costs Health issues Legislative benefits

17 For agent or broker use only. Not for use with the public. ©2009 Lincoln National Corporation LCN LIF-GEN _LIF-PPT106 2/ Evaluate Reasons to consider exchange or replacement Secondary guarantees Lower mortality expenses Improved underwriting class offering Need to access more living benefits

18 For agent or broker use only. Not for use with the public. ©2009 Lincoln National Corporation LCN LIF-GEN _LIF-PPT106 2/ Evaluate Clients own life insurance policies that Need no changes, reassuring clients Need beneficiary designations updated Could be more efficiently consolidated into a single policy Are underfunded

19 For agent or broker use only. Not for use with the public. ©2009 Lincoln National Corporation LCN LIF-GEN _LIF-PPT106 2/ Evaluate: if underfunded Possible solutions Increase the future premiums to make up for the shortfall Improve underwriting class if eligible Drop unnecessary riders Reduce face amount if need has decreased

20 For agent or broker use only. Not for use with the public. ©2009 Lincoln National Corporation LCN LIF-GEN _LIF-PPT106 2/ Evaluate: if underfunded Potential problems with these solutions If policy has an existing loan and the client is making further loans to make premium and interest payments, problem only becomes worse Need for current level of insurance remains Desired changes may neither be available nor meet planning objectives

21 For agent or broker use only. Not for use with the public. ©2009 Lincoln National Corporation LCN LIF-GEN _LIF-PPT106 2/ Evaluate: a possible solution A new policy — but be cautious Ensure that every client has the best possible life insurance solution based on the client’s needs and objectives — whether it is keeping and adjusting the client’s current policy or replacing it with a more appropriate one.

22 For agent or broker use only. Not for use with the public. ©2009 Lincoln National Corporation LCN LIF-GEN _LIF-PPT106 2/09 22 You must be a registered representative to review or recommend a variable insurance product. For all recommendations Always put the client first Highest ethical standards Gather all the facts Abide by the golden rule — provide the same service and recommendations to clients, which under the same circumstances, you would apply to yourself

23 For agent or broker use only. Not for use with the public. ©2009 Lincoln National Corporation LCN LIF-GEN _LIF-PPT106 2/09 23 Lincoln DesignIt SM software tool

24 For agent or broker use only. Not for use with the public. ©2009 Lincoln National Corporation LCN LIF-GEN _LIF-PPT106 2/09 24 What if a 1035 Exchange is an option? 58-year-old male Complete financial needs analysis Qualifies for standard nonsmoker Increased need for life insurance Needs help analyzing options

25 For agent or broker use only. Not for use with the public. ©2009 Lincoln National Corporation LCN LIF-GEN _LIF-PPT106 2/09 25 What if a 1035 Exchange is an option? Keep current insurance Keep current insurance and supplement with term Surrender current insurance and purchase only term 1035XN current insurance

26 For agent or broker use only. Not for use with the public. ©2009 Lincoln National Corporation LCN LIF-GEN _LIF-PPT106 2/09 26 Option 1Option 2Option 3Option 4 Total cost Increase $23,470Increase $23,470 plus Term $10,053 Surrender current insurance at surrender charge of $2,046 annual premium $18, XN current CSV $18,528 annual premium Current death benefit $550,000 Lapses at 80 $550,000 Lapses at 80 $1,000,000 Term expires in 25 years $1,000,000 no expiration Guaranteed death benefit* $550,000 Lapses at 80 $550,000 Lapses at 80 $450,000 Term 20 year $1,000,000 Term expires in 25 years $1,000,000 no expiration Decision Not a viable option — even with increasing the monthly premium by over $2,000 per month, lapse at age 80 Term expires in 20 years Not a viable option – coverage expires in 25 years Meets all stated goals Options *Guarantees are backed by the claims-paying ability of the issuing company.

27 For agent or broker use only. Not for use with the public. ©2009 Lincoln National Corporation LCN LIF-GEN _LIF-PPT106 2/09 27 *Guarantees are backed by the claims-paying ability of the issuing company.

28 For agent or broker use only. Not for use with the public. ©2009 Lincoln National Corporation LCN LIF-GEN _LIF-PPT106 2/09 28 Male, age 56, $400,000 face amount Preferred plus rating in 2002 — good health, low cholesterol At present — overweight, high cholesterol Change in health

29 For agent or broker use only. Not for use with the public. ©2009 Lincoln National Corporation LCN LIF-GEN _LIF-PPT106 2/09 29 Result of PAR analysis Current policy year — would receive standard rating Existing policy retained However, opportunity to review and update beneficiary designations and ownership Plan to review again in two to three years Reassures client *Guarantees are backed by the claims-paying ability of the issuing company.

30 For agent or broker use only. Not for use with the public. ©2009 Lincoln National Corporation LCN LIF-GEN _LIF-PPT106 2/09 30 Why offer PAR? How you can benefitHow clients can benefit Deepen relationships →Reassurance Perform due diligence →Insurance matching their needs Build your business →More loyalty for their advisor

31 For agent or broker use only. Not for use with the public. ©2009 Lincoln National Corporation LCN LIF-GEN _LIF-PPT106 2/09 31 Questions?

32 For agent or broker use only. Not for use with the public. ©2009 Lincoln National Corporation LCN LIF-GEN _LIF-PPT106 2/09 32 Important disclosures Lincoln life insurance is issued by The Lincoln National Life Insurance Company, Fort Wayne, IN, and distributed by Lincoln Financial Distributors, Inc., a broker/dealer. The Lincoln National Life Insurance Company does not solicit business in the state of New York, nor is it authorized to do so. Contractual obligations are backed by the claims-paying ability of The Lincoln National Life Insurance Company. Policies sold in New York are issued by Lincoln Life & Annuity Company of New York, Syracuse, NY, and distributed by Lincoln Financial Distributors, Inc., a broker/dealer. The contractual obligations are backed by the claims-paying ability of Lincoln Life and Annuity Company of New York. Products and features are subject to state availability. This material was prepared to support the promotion and marketing of an insurance company product. Lincoln Financial Group ® affiliates, its distributors, or their respective employees, representatives, and/or insurance agents do not provide tax, accounting, or legal advice. Any tax statements contained herein were not intended or written to be used, and cannot be used for the purpose of avoiding U.S. federal, state, or local tax penalties. Please consult your own independent Financial Advisor as to any tax, accounting, or legal statements made herein. Lincoln variable universal life insurance is sold by prospectus. Carefully consider the investment objectives, risks, and charges and expenses of the policy and its underlying investment options. his and other important information can be found in the prospectus for the variable universal life policy and the prospectus for the underlying investment options. Prospectuses are available upon request and should be read carefully before investing or sending money. For a current prospectus, please call or go to Lincoln Financial Group is the marketing name for Lincoln National Corporation and its affiliates. Affiliates are separately responsible for their own financial and contractual obligations.


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