By Agent Randy E. Hoffman(08/16/2016) Cadoi#0H51968
PURCHASE NOW gets you lower premium,pay less $ over life of policy,insurable now with good health,preferred rates now,assets protected,estate and love gift maximized,enjoy emotional and mental well-being
PURCHASE LATER gets you much higher premium, pay more $ over life of policy,risk of worse health(rating increase),risk of becoming uninusurable which means (no policy available),assets unprotected,family in unnecessary probate court,the stress and knowledge of failure of responsibility
By Agent Randy E. Hoffman (08/07/2016) CADOI#0H51968
The federal estate tax is 40% on anything above $5.45 million of assets. If the PRINCE estate was worth $300 million, the rough estimate is $120 million tax bill to the feds. The state of Minnesota estate tax is around 13% so the PRINCE estate at his death owes roughly $150 million in taxes which are collected 9 months after death by the IRS. Now, the absurdity is PRINCE not only DID NOT have a will but no TRUSTS. TRUSTS protect against not only taxation but specify who gets what at the death of the deceased’s assets.
A SPECIAL TRUST for life insurance is called the (ILIT) – IRREVOCABLE LIFE INSURANCE TRUST. This is a method to place a life insurance policy inside a trust to protect it from taxation for the express purpose of paying the estate taxes due at death WITHOUT USING THE DECEASED’S ASSETS thereby keeping the wealth in the family.
So, if the PRINCE financial Advisors would have done their job, PRINCE would have owned a $150 million life insurance policy that would have been placed in an (ILIT). He could have easily financed the premiums for the policy with his residual income that his assets were creating.
The reward? ALL of his hard earned wealth would have not been touched and stayed in his beneficiary’s control. In addition to the above estate taxes due, his estate also loses money from the inevitable probate costs that the court will charge to decide who gets what. Attorney fees will joyfully eat up millions. Again, ALL OF THIS COULD HAVE BEEN PREVENTED BY PROPER PLANNING. (Always get credible legal advice from a respected attorney).
Agent Randy E. Hoffman(08/11/2016) CADOI#0H51968
NO! Very good question because many people are worried about how they would handle a huge sum of money all at once. Beneficiaries can choose to settle with the insurer in a number of ways aside from the obvious and common method of a lump sum payment. These optional modes of settlement include the following:
- Leave the proceeds with the insurer and receive annual interest payments;
- Accept the proceeds in installments for a specified period of time (fixed years installments);
- Accept the proceeds in installments of a specified amount (fixed amount option); and
- Accept the proceeds as a life annuity (systematic liquidation of principal and interest) for the life of one or more persons.
By Randy E. Hoffman 05/29/2016
Well here it is, Memorial weekend and I’m in the mood to write on that subject I hold oh so dear, LIFE INSURANCE. Since I know you’re on the edge of your seat, let’s continue. One thing I must admit, our industry has been far behind others in general as far as adapting to the quick unrelenting pace of high-tech changes.
I even had a retired geek friend warn me of the day that robots will simply replace us agents as the gateway to getting a new policy. Perish the thought. Some things ALWAYS will require human interaction, Life insurance is one of them. Although 80% of life insurance buyers begin their search online, only 15% actually complete an application there. WHY? When discussing a subject so personal and confidential, people still need people. I’m not saying that robots won’t be available someday to purchase a life policy, I’m saying I believe that it will be a small segment of the industry. Why would people buy from a robot or online without an agent anyway? The rates aren’t any different and who do your beneficiaries call when the worst happens?
Having said that, the industry is neanderthal in using technology to not only making things easier for the client, but also the agent. Do people really want a mobile app to apply for life insurance? Maybe so…. but with a twist. The twist is after being coached by a good agent on options available the applicant could apply on their mobile device should they so choose.
Another thing about shopping online without an agent is that quotes are just quotes, the robot or website cannot do a good job of assessing the possible risk category that the potential client may fall into as they go through the underwriting process. With a good agent you will get a far more realistic price structure based on age and your current health status than a robot or website just throwing out numbers.
The industry must do a better job of speeding up the underwriting process and assisting the agent at explaining the options available to the client and that is why they need to create online and mobile systems for the agent NOW !!! I wonder what they will call the Robot that ultimately replaces me.
by Agent Randy E.Hoffman 05/23/2016
A WARNING and Commentary:
Last week one of the most powerful life insurers in the world pulled one of their products in their Permanent Life Insurance Family. They cited the adverse interest rate environment that would make it difficult for new policyholders to benefit long term. I applaud their integrity and credibility for doing this.
Between my Father, a deceased Uncle and myself, we have around 88 years of experience offering life insurance and we’ve had many heated arguments over what products fit the client best at different time periods in their lives. I DO NOT like so called ” Cash Value ” products, PERIOD! I don’t trust them. I don’t care if it’s Whole, Universal, Variable Universal or Indexed Universal or some other name that ends up confusing the buyer. These products are designed for a PERFECT world and we do not live in a PERFECT world. When you buy these products YOU lose control of the numbers, the insurance company controls the numbers.
Last spring I got a call from a gal extremely upset because she found out after 13 years of paying into a ” Whole Life ” policy, her cash value was a little more than one month’s premium! To make matters worse it was sold to her by her sister! When I showed her what I would have done for her back then she flipped out when she realized she could have saved $ 140.00 monthly and got the same death benefit. What would that money be worth now if it was put in a mutual fund over that 13 year period?
Agents that push these products are paid commission every year the policy stays on the books unlike a much more affordable term product which normally only pays the agent the first year. It is my strong opinion that Life Insurance should be a stand alone purchase, when you combine a savings element and a potential tax benefit with a future policy loan feature you open the door to trouble and that trouble can turn ugly at a critical time of your life.
I realize agents have differing opinions on this matter but I will never have to answer this question to a valued client ” what happened to my cash value “? Term products can be purchased all the way up to Age 80. By stacking or what we call ” Laddering ” a series of Term Products throughout your life you ALWAYS control the numbers and have the knowledge that you will leave the largest death benefit possible to the people you love the most.
Let your life insurance be life insurance and your investments be investments and NEVER combine the two. I offer 3 GUARANTEED products 1) Straight Term available up to issue age 80. (includes the monthly income option) 2) Universal with DEATH benefit number GUARANTEE 3) SINGLE PREMIUM with DEATH benefit number GUARANTEE.
1. Buys time: Allows loved ones to focus on their grief by helping to pay for the funeral and other costs.
2. Provides a fresh start: Lets loved ones start with a clean slate by helping to pay off credit card bills, outstanding loans and even the mortgage.
3. Generates income: Helps replace lost income for years to come so that surviving family members can continue to pay for life’s necessities.
4. Offers flexibility: Gives a surviving spouse the chance to take time off or to switch to a job that offers a more flexible work schedule.
5. Creates opportunities: Can provide funding to start a business, or pay for schooling so surviving family members can train for a new career.
6. Funds the future: Offers a way to fund longer-range goals like a college education for the kids or a secure retirement for a surviving spouse.
7. Leaves a legacy: Gives parents the chance to leave future generations with the legacy of long term financial security.
Agent Randy E. Hoffman – Life Insurance Design SpecialistCA(760)492-1423 # DOI0H51968
Buy Term Term Term !!! Avoid losing control !!!
I beg, plead, pray and constantly preach ” BUY TERM ” !!! DO NOT let the insurance company control the numbers, and then I see stuff like this. Unless there is no other choice, run from Whole, any type of Universal or so called “Permanent plans “. They are sold for the insurer’s benefit, NEVER YOURS !!!
Transamerica Life Insurance Co. has been sued for raising the cost of insurance on some universal life insurance contracts, an action plaintiffs allege constitutes a breach of obligations under the policies and has led to damages against contract holders.
The class-action suit, Feller et al v. Transamerica Life Insurance Co., comes as insurance companies have struggled under the burden created by persistently low interest rates, which make it more difficult for insurers to pay out claims on contracts with generous provisions inked during times of higher rates.
Last year, AXA Equitable Life Insurance Co. and Voya Financial also upped costs on some in-force universal life insurance, which is a type of cash-value life insurance.
“There have been a steady number of these [cost of insurance] lawsuits over the past seven or eight years, with mixed results,” according to Phillip Stano, a partner at law firm Sutherland Asbill & Brennan and a defense attorney representing insurance companies. “There’s no one-size-fits-all, but certainly the interest-rate environment is a factor, in many but not necessarily all cases.”
(by Agent Randy E. Hoffman 03/07/16)
The Life Insurance Agent…Superhero? ABSOLUTELY !!!
Well here we are in March and summer is fast approaching. A time when kids and parents alike will end up heading to the cinemas to feast on Hollywood’s annual tradition of superhero escapism. Personally, I’m especially looking forward to the “Batman Vs. Superman” flick although the new “Captain America Civil War” is also tempting.
God forbid I leave out the new X-Men film. Okay, before I get too wrapped up mentioning the countless superheros I relished as a kid reading those dime store comic books, let’s get back to the headline.
What in the world do I mean by the life insurance agent being a superhero? No, the agent can’t leap tall buildings in a single bound, probably doesn’t drive a cool car like Batman or swing from downtown buildings like Spiderman. But…..the agent does something that all the world’s superheroes together can NEVER do.
What is that? I, the agent can INSTANTLY CREATE MONEY THAT NEVER EXISTED BEFORE. That’s right! Superman can’t do that. Batman can’t do that. Spiderman can’t do that. Ironman can’t do that. None of them can!
- I can create a family fortune.
- I can wipe out mortgages.
- I can create seed money that multiplies into the millions or billions, instantly.
- I can wipe out homelessness and poverty. I can provide the best college or any education.
- I can destroy credit card debt.
- I can destroy financial stress for generations to come.
- I can provide new houses and cars. I can load up a charity’s bank account.
The leverage that the life insurance policy offers is a miracle. The life insurance policy is the only thing in this world that provides complete financial security at the time it is needed most. NO SUPERHERO CAN DO THAT! Okay, my rant is over, I hope I made my point. Now if you’ll excuse me, I must go shopping for a cape.