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Term life insurance sales in the US consistently represent about 70% of the total death benefit bought by consumers every year, according to the Insurance Information Institute. And for many of those buyers, the provision to convert their term insurance into permanent life insurance somewhere down the line represents an important option. But according to several leading term insurers, less than 5% of term life policyholders ever take advantage of this option, and those who do often are motivated by deteriorating health. Because these clients have a mortality risk of about five times normal for...

Accelerated underwriting is a new and growing trend that offers important advantages over other programs allowing for an insurance qualification process that does not require examinations or fluids. Having an approved policy in hand can occur in a few business days, rather than weeks, and product pricing is typically more favorable with many carriers offering their full suite of off-the-shelf products with no compensation haircuts. These are all positive factors associated with accelerated programs. However, since most accelerated programs are a triage process, there are no guarantees an appli...

Of all the progressive things the life industry has done in the past few years to advance underwriting standards and make it easier to do business, one area significantly lagging is charitable life underwriting. In charitable situations, the maximum amount of coverage available across almost every carrier in the industry is based upon a multiplication factor—typically 10—of one's past annual giving to a charity. So if an applicant on average has given $10,000 annually to a particular charity and desires to leverage this giving by allowing the charity to own life insurance on his life, he would...

A recent tax court case ruling in favor of the taxpayer in an intergenerational Split Dollar arrangement has propped open a "discounting" planning door that, up to now, the IRS had tried to slam shut. In the Estate of Clara M. Morrissette et al v. Commissioner, the tax court ruled that an intergenerational Split Dollar arrangement is covered by Split Dollar Regulations Section 1.61.22. In plain English, the ruling establishes that single-premium life insurance policies, held in irrevocable trusts, can be taxed under the Split Dollar Economic Benefit regime, and are not required to use the Loan...

Willard Scott can't keep up! It's no longer unique or surprising when we come across someone who is approaching age 100. We probably have someone in our own immediate family going strong at 85, 90 or even 95 years old. Whether because of good genes, healthy living, medical improvements or all of the above, living longer is a reality. The blessing of a long life has many advantages but it also requires that we think about how to pay for that extended number of years. The axiom that people fear "running out of money" more than they fear death is truer today than ever before. The major risks to r...

A New Program Offers Life Insurance for Declined Cases.  It always seems to happen. You have a client—probably one of your best clients — who desperately needs to buy life insurance to cover a loan or a business buy-sell and is willing to pay the price for whatever they can get. You've sealed the deal — but because of health problems or other issues you are unable to deliver an offer from any carrier—at any price. It's a conundrum for the ages, but now there is a solution. Windsor recently developed a relationship with a creative A.M. Best "A" rated domestic carrier to tackle this very pr...

Jumbo cases can be challenging. Defined by many carriers as total line of coverage applied for including coverage in force exceeding $65 million, this is especially true for super jumbo applications that involve total lines in excess of $100 million, and where health conditions or applicant age become factors. Every application is unique and individual case facts make the task of putting jumbo and super jumbo cases together anywhere from reasonably challenging to downright impossible. However, with premiums from five figures to several million, we need to approach these situations with working...