Author Tony Steuer provides a clear path to understanding life insurance with his new workbook and Slideshare series. Tony is a Life Insurance Analyst who writes about the insurance industry as an advocate for financial literacy.
Strategic Resources May 2024 Corporate Presentation
Life Insurance Workbook
1. H O W W I L L T H I S W O R K B O O K
A N S W E R Y O U R Q U E S T I O N S ?
THE QUESTIONS AND
ANSWERS ON LIFE
INSURANCE WORKBOOK
Created by the author of Questions & Answers on Life Insurance
Tony Steuer, CLU, LA, CPFFE
2. By Tony Steuer, CLU, LA, CPFFE Visit: www.tonysteuer.com
AUTHOR OF:
TONY STEUER, CLU, LA, CPFFE
3. By Tony Steuer, CLU, LA, CPFFE Visit: www.tonysteuer.com
TONY STEUER, CLU, LA, CPFFE
• Author, Advocate and
educator for insurance
literacy
• Director of Financial
Preparedness - United
Policyholders
• Member: California
Department of Insurance
Curriculum Board
• Member: National
Financial Educators
Council Curriculum
Advisory Board
4. By Tony Steuer, CLU, LA, CPFFE Visit: www.tonysteuer.com
THIS PRESENTATION WILL GIVE YOU AN
OVERVIEW OF THE QUESTIONS AND
ANSWERS ON LIFE INSURANCE WORKBOOK
This presentation:
• Highlights important topics
in the workbook;
• Gives you simple answers to
the top questions on life
insurance; and
• Helps you to know the right
questions in order to plan
well and spend wisely.
5. By Tony Steuer, CLU, LA, CPFFE Visit: www.tonysteuer.com
STEP 1: EVALUATE YOUR
NEEDS & SITUATION
Take charge! It’s your money, so
plan your way to smart spending.
• Life insurance is for the
benefit of someone who is
dependent upon your
income, like a child,
spouse/partner, or business
partner.
• To purchase the right
policy, it’s important to take
the time and evaluate your
situation.
6. By Tony Steuer, CLU, LA, CPFFE Visit: www.tonysteuer.com
STEP I: CALCULATE YOUR
NEED FOR LIFE INSURANCE
Protecting family from…
Income loss, debt, or estate
tax liability
WHAT ARE YOUR NEEDS?
To determine how much life
insurance you need, use the
worksheet or calculators on
www.lifeinsurancesage.com or by
clicking on the image:
7. By Tony Steuer, CLU, LA, CPFFE Visit: www.tonysteuer.com
What if I have group life?
(For example, through an employer.)
If not, skip to the next slide.
• Premiums typically increase annually or every fifth
year for group insurance plans;
• Coverage is usually not portable (you can’t take it
with you);
• Generally, group plans are more expensive for those
in good health (due to simplified or modified
underwriting); and
• Coverage amounts are limited.
8. By Tony Steuer, CLU, LA, CPFFE Visit: www.tonysteuer.com
STEP 2: FINDING THE LIFE INSURANCE THAT’S BEST FOR YOU
TERM LIFE INSURANCE OVERVIEW
Term Insurance provides coverage only for a
specified amount of time and expires without value.
Types (most common):
•Guaranteed Level Premium Term
•Annual Renewable Term
•Decreasing Term (a.ka. Mortgage Insurance)
•Return of Premium Term
View my presentation: Understanding Term Life Insurance at:
http://www.lifeinsurancesage.com/slideshare/
9. By Tony Steuer, CLU, LA, CPFFE Visit: www.tonysteuer.com
STEP 2: FINDING THE LIFE INSURANCE THAT’S BEST FOR YOU
PERMANENT LIFE INSURANCE OVERVIEW
Types (most common):
•Whole Life
•Universal Life
•Variable Life
•Equity Indexed Universal Life
•Joint & Survivor (2nd to die)
Permanent Insurance is designed to provide coverage until
you die and often accumulates a cash value over time.
View my presentation: Understanding Permanent Life Insurance at:
http://www.lifeinsurancesage.com/slideshare/
Insurance policies
may look alike, but
each one is
different.
10. By Tony Steuer, CLU, LA, CPFFE Visit: www.tonysteuer.com
• Evaluate your health (examples: physical build,
cholesterol, medical conditions, family history, etc.)
w Medical Records - review your medical records to
understand your history and health.
w Think of your health rating like a credit rating. In
finance the better your credit score, the more
favorable your interest rate. Good health and
physical fitness earn you a good credit score and
thus a better rate.
• Financial Underwriting
Different life insurance companies have different
underwriting standards. Because these standards
determine the rates you pay, you want to be well aware
of the differences among them before you sign on the
dotted line.........................
STEP 3: ASSESSING HEALTH AND OTHER
FACTORS THAT IMPACT PREMIUM RATES
Which one is you?
11. By Tony Steuer, CLU, LA, CPFFE Visit: www.tonysteuer.com
PART II: EVALUATE COMPANIES & AGENTS
STEP 4: EVALUATING LIFE INSURANCE COMPANIES
The workbook gives you details on how
insurance companies are rated so that you
can evaluate your company, and explains:
• Financial Strength Ratings
• What these ratings are & where to
find them
• Financial Analysis
• Ethical Standards
• NAIC/State Insurance Department -
Complaints (for Variable Products -
FINRA)
Visit
www.lifeinsurancesage.com
for links to rating services,
NAIC & FINRA
12. By Tony Steuer, CLU, LA, CPFFE Visit: www.tonysteuer.com
STEP 5: CHOOSING AN ADVISOR
• Check on whether the professional working with
you is properly licensed with the Department of
Insurance in your State (and for Variable Products
with FINRA) at: www.lifeinsurancesage.com
• What are there qualification & designations?
Chartered Life Underwriter’s (CLU’s) have
comprehensive Life Insurance training (use
www.designationcheck.com to confirm)
• Be aware of rogue designations - See the California
Department of Insurance Bulletin on Senior
Designations.
• Find an advisor at the Society of Financial Services
Professional (SFSP) website (www.financialpro.org)
or at the LIFE website (www.lifehappens.org)
13. By Tony Steuer, CLU, LA, CPFFE Visit: www.tonysteuer.com
STEP 6: SELECTING POLICY COMPONENTS & RIDERS
w Beneficiaries - always make sure to name a contingent
beneficiary.
w Policy Owner - know how this financial tool works and
how changes or events can seriously affect it (i.e. policy
loans). Ask questions if you don’t understand
something.
w Policy Riders - are they worthwhile? Popular riders
include:
w Waiver of Premium
w Accelerated Death Benefit Rider
• The workbook helps you to prioritize what is important
and empowers you to ask questions. Keep in mind the
following as you choose or evaluate a policy:
Complete the application accurately, completely and truthfully
along with all forms.
14. By Tony Steuer, CLU, LA, CPFFE Visit: www.tonysteuer.com
PART III: UNDERSTAND, MAINTAIN
& MONITOR YOUR POLICY
The workbook reviews what you need to know
after you’ve obtained a policy (or found an old
policy in a drawer.)
Policies are living things. Keep track of them!
Key information is explained so that you can
decide to keep, replace or terminate a policy.
15. By Tony Steuer, CLU, LA, CPFFE Visit: www.tonysteuer.com
FREQUENCY OF PAYMENT
It matters how frequently you choose to pay your insurance. Changing how
often you pay can save you a lot of money (especially on term insurance).
FREQUENCY OF PAYMENT
MONTHLY
ANNUAL
COST(%extrayoupay)
SEMI-ANNUAL
Click here to
open an online
calculator
QUARTERLY
3.92 - 8%
4-20%
2-6%
0%
16. By Tony Steuer, CLU, LA, CPFFE Visit: www.tonysteuer.com
STEP 7: ASSESS YOUR POLICY
IS IT LIVING UP TO YOUR EXPECATIONS?
Gather and check for this information:
• Death Benefit
• What is the current benefit?
• Type of Coverage
• Term, Whole Life, Universal Life, Variable Life,
Equity Indexed or something else...
• Cash Value (if any)
• Loan Values (if any)
• Conversion Eligibility
• If it’s term insurance, some policies allow
conversion to permanent.
• Any and all information is helpful in your
assessment!
17. By Tony Steuer, CLU, LA, CPFFE Visit: www.tonysteuer.com
FURTHER STEPS: ASSESSING
A PERMANENT (CASH VALUE POLICY)
Here is what you need to monitor an existing life
insurance policy:
• Current (most recent) annual statement
• In-force illustration based on current assumptions
• In-force illustration(s) with any desired
modifications
Sign up for an annual review package at:
www.lifeinsurancesage.com
Read about why (and how) a policy can under-
perform in the Resources section at:
www.lifeinsurancesage.com
Is your policy
running out of
time?
18. By Tony Steuer, CLU, LA, CPFFE Visit: www.tonysteuer.com
STEP 8: REPLACING A POLICY:
TERM INSURANCE
When replacing a term policy, consider these facts:
• Premium
• What is the actual net premium & is it guaranteed?
• Length of guaranteed premium period
• New Incontestability Clause & Suicide Provision
• Most policies are issued with an incontestability
clause, which means that unless you don’t pay
your premium, the insurance company cannot
contest the insurance contract during your lifetime
as long as the original policy is in-force, no matter
how your health may change. Check for the period
of time that the company is allowed to contest.
19. By Tony Steuer, CLU, LA, CPFFE Visit: www.tonysteuer.com
STEP 8: REPLACING A POLICY:
PERMANENT (CASH VALUE) INSURANCE
• What are the different assumptions & guarantees
in your policy?
• Interest Rate, Dividend Scale, etc.
• Cost of Insurance/Mortality Cost
• Expense Charges
• Qualification as an IRS Section 1035 Tax-Free
Exchange
• Is there a surrender charge?
• What are other pros & cons?
The above are the main areas, however, every
permanent life insurance policy is a complex
financial product with unique features.
Comparing permanent
policies can be a
complex & tricky
area. Proceed with
caution
20. By Tony Steuer, CLU, LA, CPFFE Visit: www.tonysteuer.com
TERMINATING A POLICY
TERM VS. PERMANENT
• Term Policy: To cancel, notify the
company and request immediate
termination (possible partial refund).
• Permanent Policy: To cancel, you can:
• Surrender the policy
• Exchange the policy to an annuity
• Gift the policy to an entity
• Sell the policy in a secondary
marketplace.
21. By Tony Steuer, CLU, LA, CPFFE Visit: www.tonysteuer.com
MORE RESOURCES
W W W. T O N Y S T E U E R . C O M
Feel free to forward this free pdf download link to friends!
Additional thanks to MyStoryCatcher.com and ThreeLineMedia.com
22. By Tony Steuer, CLU, LA, CPFFE Visit: www.tonysteuer.com
DOWNLOAD THE FREE REPORT
AT TONYSTEUER.COM:
W W W. T O N Y S T E U E R . C O M
23. W W W. T O N Y S T E U E R . C O M
THANK YOU!
Thank you for taking the time to watch this Presentation!
Notas do Editor
There are a number of scenarios or life situations that support a need for life insurance. There’s a quiz in the workbook to help you determine your needs, but some of the most common situations are: You’re a primary breadwinner for your family. You have young children who are dependent on your income. You have debt - mortgages, car loans, credit cards, student loans, or some other form of large, significant debt that you don’t want to burden your family or cosigners with if you passed away tomorrow. I don’t want to burden my family with the costs of my funeral. You want to have an emergency fund. You’re worried about estate taxes. You want your family to have liquidity upon your death to fund the estate tax liability. You’d like to donate a sizable amount to charity once you pass. You want to make sure your heirs each get an equal share of your assets when you pass away. You’ve got assets that haven’t been taxed yet (a tax-deferred retirement account, for instance), and you don’t want your family to be burdened with those taxes upon your death.
Knowing the difference between term and permanent insurance is critical. Term Insurance provides coverage only for a specified amount of time. Permanent Insurance is designed to provide coverage until you die and often accumulates a cash value over time.
Knowing the difference between term and permanent insurance is critical. Term Insurance provides coverage only for a specified amount of time. Permanent Insurance is designed to provide coverage until you die and often accumulates a cash value over time.
Knowing the difference between term and permanent insurance is critical. Term Insurance provides coverage only for a specified amount of time. Permanent Insurance is designed to provide coverage until you die and often accumulates a cash value over time.
Policies are living things, and there are many components that can affect their performance. This is particularly true with permanent policies that build cash value over time. For example,i f you’ve taken out policy loans or have a Universal/Variable/Equity Indexed, etc. - you’ll need to pay extra attention to premium payments and the investment portfolio—you’ll want to be very aware of how much money it’ll take to keep those policies in-force, and whether you can afford to keep them in-force.
The reason the monthly option is frequently more economical than the quarterly is because monthly bank-draft persistency is better than quarterly mode persistency.