Client Solication Letter

[Allen Trent]

Actually the company does not have a letter for agents it has marketing pieces. I have already checked. Thank you so much I have put together one, but can't use a company's name which is understandable.

Most states insurance departments require you to specifically disclose the exact product versions you are discussing in your letter & including the filed form #s of the contract. This is why it is actually best to use the carrier marketing pieces if you are looking to mail something

 

[DHK]

Is anyone willing to share a letter that you send to existing clients asking them to consider a fixed and or indexed annuity? I am not currently in the annuity world but want to offer this product to my existing clients.

If you're going to market a product in writing... the more specific you are, the more you'll need that company's compliance approval of your marketing piece. This isn't hard to get and often you'll get your turn-around times in less than a week. (I've seen same-day turn-arounds.)

However, on the life and annuity side of this business... the products themselves don't sell. They are sold in context of a problem to be solved.

Outline the problem in great enough detail... and the solution sells itself.

Trying to sell product outside of the problem... and you'll probably get nitpicking questions that you'll have to answer. Granted, you'll need to know all the questions and disclose all the fees (as applicable), how the surrender charges work, etc. Just saying that you want there to be a bigger picture than how the product works.

The advantage of selling on the problem or on a concept... is that you don't need a company's compliance approval for that marketing letter (if you're an independent agent; no dice if you're with a broker/dealer, regardless of what product you're selling).

 

[goillini52]

New Horizons has a web page on how to market annuities to seniors. I think most of the stuff mentioned there is marketing materials like you were talking about already having, but it probably would not take you very long to scan the page and see if there is anything there of use to you.

https://www.newhorizonsmktg.com/training/annuities/home

 

[goillini52]

Is anyone willing to share a letter that you send to existing clients asking them to consider a fixed and or indexed annuity? I am not currently in the annuity world but want to offer this product to my existing clients.

https://email.newhorizonsmktg.com/e...F_W94KCg16zd7XvW5VsSwh1cGTb2N78j6sdPQl9z3bKm1

 

[Allen Trent]

https://email.newhorizonsmktg.com/e...F_W94KCg16zd7XvW5VsSwh1cGTb2N78j6sdPQl9z3bKm1

While I love the concept of the flyer, there are too many items on it that are either not allowed or inaccurate to be able to be used.

Can't legally promote or even call attention to the Guaranty Assoc in marketing materials.

5 yr rates of average MYGA have not been 3-4% in quite some time. Today, they are 1-3%, which is actually a bit higher than recently

Gives the impression that CD are worse taxation wise. But for the average senior that no longer files a tax return or is in 0% tax bracket, the impression that the annuity is better tax wise isn't really true for most. The vast majority of seniors buying a NQ Annuity not using for income will be deferring the annual tax at 0% or 10% only to either owe on a larger deferred gain at maturity or heirs will owe on all the deferred gains at death. CDs don't have deferred gains, so they are tax free at death

Says MYGA is not subject to Probate. Not exactly true. Just like the CD can have beneficiaries named or owned by Trust & avoid Probate, an Annuityay also go to probate if beneficiary is the Estate or beneficiaries are not updated & no living beneficiaries at time of annuitant/owner death

I don't believe it is true that "most" MYGA allow 10% free withdrawal currently, especially those that might be paying 3-4%. Most better paying MYGA today don't allow any withdrawal in 1st year & after that only allow free withdrawal of annual interest, not 10%

MYGA is not the most common fixed annuity. Much more premium.annually is going into indexed annuities

Way too many product variations that make a flyer like this to be misleading in the hands of the client if a product later purchased contradicts these generalities

But I like the concept & agree with the premise that MYGA can be better than CD for high income seniors.

In the hands of reps that don't know these details, this flyer can be exhibit #1 in court when the rep is sued for the sale or it not being in the consumer best interest

 

[Packerland]

Not needed. Not a single penny of an indexed annuity is invested in any securities accounts. Indexed annuities are fixed & only require a life insurance license.......all that said, I don't think anyone should sell it without hundreds of hours studying them under an ethical producer of them. They are way too complicated for the average producer & consumer to comprehend all the moving parts of what they are & what they are not

Really hundreds hundreds of hours of training... over kill to say the least .... We are talking a fixed freaking annoying here...

Sure you need a sounding board for complex questions and or cases...

 

[Allen Trent]

Really hundreds hundreds of hours of training... over kill to say the least .... We are talking a fixed freaking annoying here...

You started the post with mentioning index annuities also. Lets assume non indexed are super easy & you don't need to understand 401k rollovers, Roth/Traditional, SEP/SIMPLE or 403b.

My guess is if you already understand Index UL, you have dozens or hundreds of hours already invested in the concepts. But if you didn't already, could you interpret how various caps, floors & participation rates work? Would you be able to explain that some/many FIA only have 1 day per year when they determine what rate it made compared to most IUL doing so monthly. Obviously tons more to it.

Honestly, in today's world of most states laws requiring you to find the annuity that is in the best interest of consumer(not merely a suitable product), I think I was low balling how long it takes to be at a reasonable level unless it is the only product focus you have.

Products have just gotten way more complicated & regulated in the last decade. It is why applications that once were 1 or 2 pages are now a dozen or more pages

 

[DHK]

Really hundreds hundreds of hours of training... over kill to say the least .... We are talking a fixed freaking annoying here...

Sure you need a sounding board for complex questions and or cases...

Um... you don't just need product training to sell annuities well.

I believe you (everyone, not just you) should have training in retirement planning, how to do rollovers, how 401(k) and IRAs work, income tax planning and how annuities work within the tax code, estate planning, and investment planning (even if you don't have securities licenses).

Why? Because annuities are not a stand-alone product that don't impact anything else. They ought to be sold with the entire client's situation in mind.

If you want a very good resource, check out the Insurance Pro Shop's training.
How To Sell Insurance Successfully In 2020

 

[goillini52]

While I love the concept of the flyer, there are too many items on it that are either not allowed or inaccurate to be able to be used.

Can't legally promote or even call attention to the Guaranty Assoc in marketing materials.

5 yr rates of average MYGA have not been 3-4% in quite some time. Today, they are 1-3%, which is actually a bit higher than recently

Gives the impression that CD are worse taxation wise. But for the average senior that no longer files a tax return or is in 0% tax bracket, the impression that the annuity is better tax wise isn't really true for most. The vast majority of seniors buying a NQ Annuity not using for income will be deferring the annual tax at 0% or 10% only to either owe on a larger deferred gain at maturity or heirs will owe on all the deferred gains at death. CDs don't have deferred gains, so they are tax free at death

Says MYGA is not subject to Probate. Not exactly true. Just like the CD can have beneficiaries named or owned by Trust & avoid Probate, an Annuityay also go to probate if beneficiary is the Estate or beneficiaries are not updated & no living beneficiaries at time of annuitant/owner death

I don't believe it is true that "most" MYGA allow 10% free withdrawal currently, especially those that might be paying 3-4%. Most better paying MYGA today don't allow any withdrawal in 1st year & after that only allow free withdrawal of annual interest, not 10%

MYGA is not the most common fixed annuity. Much more premium.annually is going into indexed annuities

Way too many product variations that make a flyer like this to be misleading in the hands of the client if a product later purchased contradicts these generalities

But I like the concept & agree with the premise that MYGA can be better than CD for high income seniors.

In the hands of reps that don't know these details, this flyer can be exhibit #1 in court when the rep is sued for the sale or it not being in the consumer best interest

https://email.newhorizonsmktg.com/e...6BV2ykrW3Z32n_W1LSqqp91vchpW5PkD9v2xXqrT3q5N1

 

[scagnt83]

Really hundreds hundreds of hours of training... over kill to say the least .... We are talking a fixed freaking annoying here...

Sure you need a sounding board for complex questions and or cases...

To be that dismissive of Allens comment shows how naïve you are about the annuity market.

To you its just a "fixed freaking annuity"... to the client its their life savings they have worked the past 40 years to save. And you are locking this in for the next 7-10 years... even the rest of their life if its an income rider sale.

Your attitude shows you probably should stick to your current products until you comprehend the gravity of an annuity sale.

Taxation and regulations are 50% of knowing how to sell annuities. How to properly position the product in the clients overall portfolio is 25%. Product knowledge is the last 25%.

This isnt a life policy or medsup policy. The client cant just change policies the next year if you provide wrong info or bad advice. Putting them in the wrong product or wrong situation could cost them thousands of dollars... even tens of thousands of dollars.

Someone who is much more knowledgeable than you are about this market gave you very sound advice. While hundreds of hours might not be needed to start selling annuities, a very large amount of time should be dedicated to learning the market... and learning the market goes way beyond just product knowledge.

Product knowledge is the easy part. The other 75% is what many agents ignore and then end up getting sued over.