Insurance Solutions

Excess and Surplus Insurance: There are six products that make up the core programs in Excess & Surplus Insurance. The first four are personal programs purchased by individuals to protect their futures, the last two are business programs utilized to insure a business owner’s equity or the human capital one brings to an organization.High-Limit Disability Income Protection: By sheer product volume, this is the leader in the Excess DI market. High limit disability income protection is most often utilized to supplement an individual’s US disability insurance coverage to provide adequate protection for high-income earners. This type of coverage typically provides an “own occupation” definition of disability. The ideal candidate for this type of coverage are CEOs, CFOs, COOs, CTOs, hedge fund, private equity and financial professionals, attorneys and specialty physicians/surgeons.Multi-Life Guaranteed Issue Disability Income Protection: For organizations employing high-earning individuals, a High-Limit Guaranteed Standard Issue (GSI) program is available which allows employers to leverage their institutional buying power, reducing coverage costs and policy underwriting requirements to streamline the application process. The employers group Long Term Disability (LTD) and domestic supplemental Individual Disability Income (IDI) programs must be maximized before a GSI policy from the Excess & Surplus Market can be offered. There are four different types of GSI programs: mandatory, mandatory with buy-up, opt-out, and voluntary plans.Disability Income Protection for Entertainers: Entertainers present unique challenge to U.S. disability carriers as their earnings history is often riddled with volatility, and they consistently present a compressed career that limits the time they earn the bulk of their income. For those reasons, the Excess & Surplus Lines Market are the primary sources to obtain Disability Income Protection for Entertainers.Disability Income Protection for Athletes: Similar to the entertainment field, a void in the US disability market leaves these professionals without a domestic option for disability income protection. For college and professional athletes, Lloyd’s provides “own occupation” coverage that is designed to pay a lump sum benefit for career ending injury or illness.Key Person Disability Insurance: For organizations with Key Executives who are vital to the financial success of their business, a corporately owned Key Person Disability Insurance program from the Excess DI market is available with a policy structure that will provide the organization a benefit in the event their key person is injured or suffers an illness.Buy-Sell Disability Insurance: For successful business owners maintaining a buy-sell agreement within their partnership, insuring the stock repurchase requirements in the event of a disability can prove challenging in U.S. disability markets. U.S. disability carriers provide this type of insurance up to a benefit maximum of roughly $2-3M per insured (this benefit varies across carriers and the state in which coverage is being issued). For business owners with additional Buy-Sell Disability funding requirements, a supplemental Disability Buy-Sell Insurance policy can be issued to reduce the business burden to repurchase a disabled partner’s equity beyond what is available from domestic carriers.

Split-Dollar Insurance: Split-dollar life insurance is a strategy that allows the sharing of the cost of a premium for a permanent life insurance policy. They are often a key part of an executive compensation package and can provide a benefit to both the employer and employee.

Term Life: Term Life insurance provides death-benefit protection for a stated time period with a level premium payment. Terms periods may be 10, 15, 20, 25, 30, 35, or 40 years, depending on the carrier. Benefits:

• Cover a larger, temporary risk
• Low-cost, flexible product that may be convertible as needs change
• Level premium payments

Universal Life (UL): Universal Life Insurance, known as UL, is a flexible-premium, adjustable benefit life insurance policy that can also accumulate account value. Premiums and values are based on projections of assumed interest rates, the cost of insurance and the insurance company’s expenses.

Benefits:

• Product is flexible, and gives clients the opportunity to accumulate cash
• Flexibility – You can adjust the death benefit and premium payments to fit your client’s needs
• Tax-Deferred Account Growth – The policy’s Account Value earns interest at the company’s current interest rate; federal income tax deferred. The guaranteed interest rate on a CAUL can be 2-3%, but the IUL policies will have a floor typically of 1% or 0% so there are no negative effects.

Variable Universal Life (VUL): Variable universal life (VUL) combines lifelong insurance protection with flexible premiums and cash value you can access while alive. VUL insurance lets you invest and grow the cash value through subaccounts that operate like mutual funds. Exposure to market fluctuations can generate high returns but may also result in substantial losses.

VUL is similar to variable life insurance, but unlike variable life, it allows you to change your premium payment amount. While VUL insurance offers increased flexibility and growth potential over other life insurance options, you should carefully assess the risks before purchasing it.

Whole Life: Whole Life is permanent insurance coverage that guarantees level premiums and the accumulation of cash values. Whole Life insurance is a good choice for long-range goals. There is participating whole life insurance usually issued by a mutual life insurance company where one participates as an owner of the company and there is non-participating whole life insurance issued by a stock life insurance company.

Benefits of Whole Life:

• Guaranteed Cash Values- A portion of the money paid into a whole life policy accumulates as guaranteed cash values. Therefore, if the policy is surrendered, these guaranteed cash values would be available to the client. Or, as long as the policy is in force, the client may borrow against them as a policy loan at the current policy loan interest rate.
• Premiums level and payable for life- Since premiums are level, the younger your client is when they purchase the policy, the less expensive the annual premiums will be.
• Dividends- Whole life insurance policies can earn dividends. Dividends result when the actual life insurance costs turn out to be less than assumed when setting the premiums.

Contingency Coverage Includes:

• Non-Appearance / Event Cancellation
• Prize Indemnity
• Physical Damage to the Venue
• Unavoidable Travel Delay
• Adverse Weather
• Death, Disablement, and Disgrace
• Breakdown of Transmission or Broadcast

Physician’s Edge 365 Coverage Includes:

• Monthly benefits up to $150,000 per month
• Elimination periods of 90, 180, and 365 days
• Benefit periods up to 60 months, plus lump sum benefits to an aggregate of $10,000,000+
• Individual or Multi-life coverage
• Residual Benefit Rider & COLA available
• Own Occupation definition

Attorney Golden Gavel Coverage Includes:

• Monthly Benefits up to $200,000 per month
• Own Occupation Coverage
• Elimination Periods of 90, 180 and 365 days
• Benefit Periods of up to 60 months, plus Lump Sum Benefits exceeding $25,000,000
• Key Person Coverage / Buy-Out Coverage
• Individual or Group CSI Coverage
• Residual Benefit available

Loan Indemnification Coverage Includes:

• Monthly benefits up to $500,000 per month
• Limits to $50,000,000
• Monthly benefits after 30, 60, 90 or 180 days
• Monthly benefit periods up to 60 months
• Own Occupation Definition

Business Overhead Expense Coverage Includes:

• Limits to $500,000 per month
• 12, 24 and 36 month benefit periods available
• Monthly benefits beginning after 30, 60 or 90 days
• Unique coverage design beyond traditional boundaries
• Coverage available for non-traditional occupations

Fixed Annuity (FA): A fixed annuity is a type of insurance contract that promises to pay the buyer a specific, guaranteed interest rate on their contributions to the account. By contrast, a variable annuity pays interest that can fluctuate based on the performance of an investment portfolio chosen by the account’s owner. Fixed annuities are often used in retirement planning.

• Fixed annuities are insurance contracts that pay a guaranteed rate of interest on the account owner’s contributions.
• The earnings in a fixed annuity are tax-deferred until the owner withdraws funds from the annuity.

 

Fixed Index Annuity (FIA): A fixed index annuity (FIA) is a long-term investment contract between an individual and an insurance company that offers principal protection and the potential for market-linked returns. FIAs are designed to help people accumulate money and provide income for retirement. 

Features of FIAs:

• Principal protection:

FIAs guarantee that the principal will not decrease, even if the market declines. This is because the investor is not directly buying stocks or shares of an index.

• Market-linked returns:

FIAs credit rates based on the performance of a market index, such as the S&P 500, over a specific time period. For example, if the insurance company sets a 50% participation rate for the S&P 500 and the index grows by 10% in a year, the investor would receive 50% of that growth, or a 5% return. However, some FIAs may also deduct a spread, margin, or asset fee from any gains in the index.

• Tax deferral:

FIAs allow assets to grow tax-deferred.

• Guaranteed lifetime withdrawal benefit (GLWB)

For an additional cost, some FIAs offer a GLWB that guarantees a “retirement paycheck” for the investor and their spouse. This income is guaranteed to increase each year that it’s deferred, up to 10 years. 

FIAs offer more growth potential than a fixed annuity, but less risk and less potential return than a variable annuity. They have become more popular in recent years as baby boomers’ investment objectives have shifted from growth to protection.

Medicaid Compliant Annuity: A Medicaid Compliant Annuity (MCA) is a financial tool that can help people meet Medicaid’s asset requirements to qualify for benefits like long-term care. MCAs are single premium immediate annuities (SPIAs) that convert a lump sum payment into an income stream with no cash value. The funds in the annuity are considered exempt from Medicaid’s asset criteria and can only go to the annuity owner or the state Medicaid agency. However, annuity payments are still counted as income when determining eligibility and patient responsibility. 

MCAs are appropriate in certain situations, such as when:

• The client lives in a facility
• They’ve used up Medicare or LTCI benefits
• They’re paying for care out of pocket
• They have excess countable assets 

To meet Medicaid’s criteria, an MCA must be:

• Irrevocable: Funds can only be withdrawn through regular payments
• Non-assignable: The contract can’t be sold or assigned to another party
• Non-transferable: It can only be in the annuity owner’s name
• Term-limited: The term must be shorter than the annuity owner’s life expectancy
• Actuarially sound: Based on the Social Security Administration’s actuarial tables
• Equal payments: Payments must be made in equal amounts throughout the annuity’s term
• No balloon or deferred payments: The annuity can’t have any deferred or balloon payments 

MCAs are available in 48 states and the District of Columbia and can be funded with either tax-qualified or non-qualified funds.