How Tax Reform Could Impact Annuities

Uncertainty around the Trump administration’s tax reform efforts has made it difficult to predict the kinds of effects that could be in store for a wide variety of consumers, investors and employers. It’s especially hard for annuity experts to determine what might happen to retirement spending. If consumers have more money in their pockets because of lower taxes, they may invest it in long-term savings, while fewer savings incentives might inspire them to simply spend the money somewhere else. So how might this affect annuities? “No one has a clue,” says lawyer Mitchell Miller. The estate tax is one of the rules expected to change, but it’s unclear exactly what might happen. “We have no idea of the form estate tax reform will take: Outright elimination? Increased exemption? Will gift tax be maintained? How about the step-up in basis? What happens to annuities will depend mightily on the details.” Here …

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U.S. Life and Health Direct Premiums Expected to Decline for First Time in 4 Years

According to S&P Global Market Intelligence’s U.S. Insurance Market Report: Life and Health, a variety of forces are expected to lead to a 1.2 percent decline in combined U.S. life, annuity, and accident and health direct premiums this year. Experts say uncertainty in the market is the main driver: As companies scramble to outmaneuver each other in the face of changing regulations, direct premiums are dropping. “Competition for market share between life insurance carriers is highly competitive at the moment,” says Anthony Martin, owner of Choice Mutual, a burial insurance agency based in Citrus Heights, California. “That’s caused a number of carriers to continue to reduce premiums, primarily on their term life insurance portfolios.” Here’s what you need to know. Life Insurance: Competition Drives Down Costs Life insurance rates are decreasing for three main reasons, Martin says: First, people are living longer, largely due to advances in health technology. Secondly, …

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What Does the Future Hold for the Fiduciary Rule?

The U.S. Labor Department’s so-called fiduciary rule, proposed during the Obama administration, would change the status of some financial professionals under the Employee Retirement Income Security Act (ERISA). It was originally supposed to be implemented in phases earlier this year but ran into delays and reviews. Now, Rep. Ann Wagner, a Republican from Missouri, has introduced a bill that would make some changes to the latest ruling, including giving the Securities and Exchange Commission the lead on fiduciary regulation, in place of the DOL. “The fiduciary rule in its current form renders all investment professionals who work with retirement plans or advise retirement plans [as] fiduciaries under the ERISA definition,” says Raphael Katz, a partner at the law firm Sadowski Katz. This results in a strict standard against self-dealing, he says — but that could change. Here’s what you need to know. The Proposed Change Wagner and financial industry proponents …

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What’s Next for Dodd-Frank?

The Treasury Department recently issued a proposal outlining changes to the Dodd-Frank Wall Street Reform and Consumer Protection Act. Dodd-Frank regulations were put into place after the 2008 financial crisis, and they changed existing regulatory structures in an attempt to streamline and strengthen them. The law led to stronger regulatory standards and rules about a wide range of financial interactions, such as credit card transaction fees and requiring smaller investment advisers to register with the SEC. The act established sweeping new regulatory rules but came to be seen as too heavy-handed. The House of Representatives recently passed the Financial CHOICE Act in an effort to weaken it, but passage by the Senate isn’t a given. “Many Democrats acknowledge that Dodd-Frank needs to be revisited, and Republicans certainly have enough votes to make sure that it is, but not enough votes to gut it completely,” says David Reiss, a professor at …

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5 Ways To Defeat Marketing Challenges In The Insurance World Today

5 Ways To Defeat Marketing Challenges In The Insurance World Today

With a fast changing world, regulatory developments that never seem to end and interest rate risks, the insurance industry is facing enough challenges – Marketing shouldn’t be one of them. Some insurance marketing experts argue that 2015 was the year we all became marketers. So as the role of marketer continues to expand, let’s lay out 5 ways to come to grips with the marketing challenges vexing the insurance world today.  1. Embrace the new and let go of the old.  It’s the age of the Millennial and adapting to technology is no longer optional. If you want to remain relevant you need to have a strong online presence. Research shows that in addition to your website 84% of people expect your business to be on Facebook (95% of Millennials have this expectation). Your clients assume their online experience mirrors the offline experience, so ensuring their online experience is positive is …

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