Did you know that September is National Life Insurance Awareness Month? The perfect time to reach out to prospects and clients to evaluate what insurance they have in place and if it still meets their needs. A good place to start is to assess your client’s current situation. Your client has different needs at different stages in their life, so good questions to review with them include: How has life changed since you purchased your coverage, or since we last reviewed your insurance: Find out about mortgages, new loans, job or income changes, education funds, retirement plans and other financial obligations so they can be sure they have the coverage they need. Has the nature of your needs changed: They may require a similar coverage amount as when they first purchased their plan, but their obligations may have shifted from temporary to permanent. A change of plan may be appropriate. Have you done any will planning: What are your hopes and dreams for your heirs: There may be an insurance need associated with the smooth distribution of their estate. Regardless of your client’s life insurance needs, they have options. So, as it gets chillier outside and we prepare for the long, cold Canadian winter ahead, take some time today to reach out and ensure that your clients have the insurance coverage they need today and into the future. Share the client article so that, in honour of life insurance awareness month, your prospects and clients can ask themselves a few good insurance related questions. If you’re looking for similar content to share with your clients, read/watch then share Insurance Solutions for Today and Tomorrow, CIDI: Enhancing Your Client’s Benefit Package, as well as the INFOclip: Building Lifetime Protection video. We also have this great Exploring Your Life Insurance Options tool to help your client understand the varying types of insurance and which one may be best for them.

Melanoma is the deadliest form of skin cancer. About 9,000 Canadians are diagnosed annually causing approximately 1,200 deaths per year (1). As a cancer long known to plague mankind, the father of Western medicine, Hippocrates, described these potentially deadly skin lesions as “the fatal black tumour”. For millennia, there was a poor understanding of the causes and possible treatments. That changed in the 19th century when physicians noted the propensity of melanoma to metastasize and later how excising certain lymph glands might prevent the spread of this skin cancer (2). The name melanoma derives from the uncontrolled proliferation of melanocytes, cells that produce pigment in both the skin and eyes. For this reason, melanomas can also be diagnosed in the eyes (ocular melanoma). Once a rare form of cancer, the worldwide incidence of melanoma continues to increase at a pace of 4-6%  yearly (3). This means 325,000 new cases globally in 2020 that will rise to 510,000 cases by 2040. Like many cancers, melanoma is more common among older lives, but not always. The legendary reggae singer, Bob Marley, succumbed to this illness when only 36 years old. Underwriting impact How does melanoma impact underwriting? More experienced underwriters will remember that the depth of invasion into the skin layer by layer, as enumerated by Dr. Wallace Clark more than 50 years ago, was the most important consideration. Tumor penetration only to the uppermost region of the skin, the epidermis, offered the best outcomes. Involvement of the subcutaneous tissue, the deepest skin layer was usually associated with the worst prognosis (4). Since Dr. Clark, tumor thickness (measured in millimetres) is thought to be the most important prognostic factor. Mortality data shows almost no excess mortality for lesions under 0.8 millimetres and progressively increasing mortality over this thickness. It takes about 10 sheets of paper piled on top of each other to achieve a millimetre of thickness. Microscopic analysis also reports if there is ulceration in the lesion, the rate of tumor cell division and more, making the pathology report the key underwriting requirement. Prevention and treatment Family history and genetics contribute to the risk of developing melanoma. The major preventive action is managing sun exposure. A good example is the public awareness campaign in Australia and New Zealand that began in the 1980’s, encouraging the public to Slip-Slop-Slap. This mnemonic was a catchy slogan to slip on a shirt, slop on sunblock and slap on a sun hat. The effect has been largely positive, with melanoma rates decreased in younger people, though the more elderly continue to have higher melanoma rates, likely the combination of age and lack of awareness of sun-blocking in their youth (5). Surgical removal remains the cornerstone of melanoma treatment. Sometimes a second surgery is performed to ensure the margins around the melanoma are clear of tumor cells. A pioneering technique called sentinel lymph node biopsy is now commonly used with a chemical dye to determine if the melanoma has spread, sparing the painful harvesting of multiple nodes when the sentinel node is negative and to select patients who might benefit from adjuvant therapies (6). PPI’s Advanced Underwriting team will continue to keep an eye on developments in the understanding, treatment and underwriting of melanoma. Canadian Cancer Society. Melanoma Skin Cancer Statistics. Cancer.ca. May 2022. Alix-Panabieres, Catherine, et al. Detection of cancer metastasis: past, present and future. National Library of Medicine. February 2022. Matthews, Natalie, et al. Epidemiology of Melanoma. National Library of Medicine. December 21, 2017. Clark’s Level. n.d. Slip-Slap-Slop. n.d. Reintgen, D., et al. The orderly progression of melanoma nodal metastases. National Library of Medicine. December 1994.

It may seem like an easy decision for your clients to invest in guaranteed return investments when rates are high, but it’s important not to lose sight of inflation. The objective, after all, is to increase purchasing power through earning at a rate higher than inflation. If inflation is, say, 5% but interest rates are also 5% then the real interest rate is 0% and there is no increase in purchasing power. Increasing purchasing power can often involve taking on some level of risk. Your clients may benefit from exploring the value of taking risks with different types of investments that offer varying risk profiles or tax treatment. Try the tools in The Value of Taking Risks and share them with your clients to help them learn more about the value of taking risks, and get the conversation started.

If your clients want to take advantage of attractive GIC rates but don’t want to lock in all their funds for a long duration, talk to them about GIC laddering. Rather than making their entire investment in a 1-year fixed term, encourage them to split it into different fixed terms of 1 year through 5 years. With this strategy, they’ll have investments maturing every year, and will stand to earn far greater returns. Share this calculator to help them see the potential advantages of GIC laddering.  

Did you know that Assuris is to the insurance industry what the Canada Deposit Insurance Corporation (CDIC) is to the banking industry? About Assuris Founded in 1990, Assuris is the independent not-for-profit organization that protects Canadian policyholders if their life and health insurance company fails. Backed by the strength of the life and health insurance industry, Assuris provides a safety net for every Canadian policyholder. Every insurance company authorized to sell life and health insurance policies in Canada is required, by the federal, provincial, and territorial regulators, to be a member of Assuris. Where OSFI’s stringent regulations are the first line of defence to prevent insurance companies from facing bankruptcy, Assuris offers a second line of defence so that if ever necessary, they will facilitate the transfer of in force policies to a solvent insurer and as needed, provide financial protection. New Higher Levels of Protection Read Assuris’ recent announcement to learn more about their new protection levels, and visit the Assuris Advisor Toolkit  to access Assuris’ CE accredited course material and Advisor Toolkit for client friendly materials: Client brochure Life insurance means security Health insurance means security Insurance-backed savings and investing means security If you have any questions about Assuris, contact your local PPI Collaboration Centre.

The incentive to improve and innovate has been around for as long as the business world itself. The American engineer, Frederick Taylor, deemed that work is worthy of observation and analysis (1). In the early 20th century, Taylor pioneered the time study of work and workers, requiring the observer to use a stopwatch while standing next to the worker, timing task completion (2). In the early 1990s, business consultants Michael Hammer and James Champy coined the term “Reengineering”, launching a movement that aimed to upend the conventions of usual business practices, exhorting managers to take a fresh look at every function and task (3). What is ChatGPT? ChatGPT may become the “reengineering” of the 2020s. Poised to “change the world”, it uses advanced artificial intelligence (AI) that takes questions from users and produces human-like responses (4). GPT stands for “Generative Pre-Trained Transformer”, denoting the design and nature of the AI training. It is a reboot of artificial intelligence with much disruptive potential. The driving force behind ChatGPT appears to be its’ ability to optimize prompt engineering, using a question-based synthesis of natural language, learning and a higher degree of reasoning in responding to inquiries. There is great promise, but the debate is already in high gear. Useful or distracting? Helping or damaging? Already there are many questions, but few definitive answers at this point. ChatGPT and Insurance Underwriting What about ChatGPT as the potential fountainhead of all underwriting knowledge and wisdom? Is the underwriting manual of 2030 going to be a simple link to the latest Chat site, inputting analytics sourced from the e-application, calibrating as fast, if not faster than the fastest Google search? We are not there yet. The ChatGPT site cautions current limitations including occasionally generating incorrect information, occasionally producing harmful instructions or biased content and lastly, limited knowledge of world and events after 2021 (5). The nature of risk selection requires a clear-eyed understanding of the uses and limitations of data and technology. It also requires leavening with human capital, the mix of experience and skill that builds the expertise necessary for successful underwriting (6). Simply put, challenging cases still require the human touch. As an experiment,  ChatGPT was asked if it could evaluate an individual insurance risk. After some discussion of how risks are evaluated, the reply concluded with the following; “If you have questions about your insurance risk level, it’s best to consult with a licensed insurance agent who can evaluate your individual situation and provide personalized advice.” Pretty smart. AI tools like ChatGPT will help accelerate underwriting transformation. Underwriters and their business partners will keep making sure that transformation is done the right way and for the right reasons. Frederik Winslow Taylor. Wikipedia.org. N.D. Time and Motion Study. Wikipedia.org. N.D. Magazine. Reengineering. Inc.com. February 9, 2020. Business Insider. Bill Gates calls ChatGPT ‘every bit as important as the PC’ or the internet. BusinessInsider.com. February 2, 2023. openai.com Cusick, Kelly, Ferris, Andy and Van Dalen, Britton. The rise of the exponential underwriter. Deloitte.com. February 24, 2021.

Household bills, mortgage payments, car loans and education savings are just some of the ongoing monthly expenses that depend on your client’s ability to earn an income. But what would happen when they passed away – what financial options do they have to protect their family’s short-term and long-term obligations? As an Advisor, you know that a solution worth considering is life insurance. However, with so many insurance options available, which one is right for your clients and their families? And how can your clients ensure that an insurance solution will fit their family’s budget today and still meet their needs well into the future? Well, they have options. Watch this video, about an insurance strategy for building a lifetime of protection designed to ensure your clients’ financial stability for today and for all of their tomorrows. Share it with your clients to help them learn more about their insurance options and designing insurance plans to best suit their needs and the needs of their families today, and well into the future. For more information on the insurance solutions available to your client, share Exploring Your Client’s Life Insurance Options and SMART TALK… about your insurance options, part of our SMART TALK video series. Your client can also use our The Ultimate Planning Tool and watch INFOclip: Protecting Your Estate to see how permanent life insurance can facilitate beneficial tax and estate planning solutions throughout their lifetime.

In recent years, the COVID pandemic has brought our mortality into sharp focus, compelling us to confront the uncertain and often-unpredictable nature of life. Indeed, this uncertain time has made all of us wonder about the prospect and impact of death, regardless of age or circumstance. Unfortunately, this period has also highlighted that nobody is too young to consider life insurance. The reasons why one may consider life insurance are diverse, ranging from important milestones like getting married, or having children, and buying a first home, or to simply securing a family’s income and future insurability. Here are a few reasons for your clients to consider life insurance… at any age. Insurability One great thing about purchasing life insurance at a young age is that once the carrier issues your client their contract and they settle it by paying the first premium, only they (your client) can change that contract. Their insurability is locked in and the younger they are when they procure their life insurance, the greater the chance they will be able to secure more favourable standard rates. Mortgage Insurance For your clients, securing life insurance on their mortgage is a way to ensure that, if anything happens to them, their family can retain their home and maintain some financial security. By obtaining a lump-sum payment upon the policyholder’s death, the surviving partner or family member can use it to settle any outstanding mortgage balance, thereby securing the home’s ownership and providing a measure of financial security during a difficult time. There are also benefits to maintaining life insurance independent of a mortgage lender and we invite you to share this video INFOclip: Mortgage Protection with your clients, to showcase these benefits. Income Earning Your clients’ earning power is perhaps their greatest asset. What would your client do if they couldn’t rely on their income to cover a mortgage, rent, car payments, daycare, groceries, etc.? Having life, critical illness or disability insurance in place can offset a potential loss of income when your client, and perhaps their family, are going through a challenging period. Share this interactive tool Insuring Your Greatest Asset with your clients to establish the importance of earning power and how to protect it. Aging Parents According to one recent poll more than 25% of Canadians aged 30+ are caring for aging loved ones (1). Having life insurance in place to ensure your client’s aging parents get the care they need, if they were unable to, could be a significant consideration for your client. Without your client’s assistance, their parent or family member’s care may fall solely on government programs. Debt At a young age, your client may have accumulated some debt and even had a parent or family member co-sign for a loan or mortgage. In the event your client passes prematurely, they would be responsible for any outstanding payments. Life insurance could guarantee that their loved ones would not carry the burden of unexpected, additional payments or debt. Final Expenses The average cost of a funeral in Canada varies based on province, and that cost can be as high as $20,000 – which is no small amount (2)! By investing in life insurance, your client can ensure the financial responsibility for their funeral does not fall upon their loved ones and alleviates the potential of leaving behind an unexpected financial burden for their family during an already tough situation. We discussed why a young individual should consider purchasing insurance, but now let’s quickly look at the biggest misconception about insurance of all – the cost. A 2021 study found that more than half of consumers overestimated the cost of life insurance by 300% (3)! However, life insurance is relatively inexpensive for a healthy young Canadian. For example, a 28-year-old Female non-smoker could pay as low as $20 a month for $1,000,000 in coverage with a Term 10 policy (4). Be sure to clear up these misconceptions with your client. Everyone benefits from making wise financial decisions early in life and, as life circumstances change, insurance can provide your clients and their family with peace of mind and financial security as a safeguard against unforeseen events. For more information about the benefits of insurance we invite you to review and share this additional content with your client network Exploring Your Client’s Life Insurance Options, Insurance Solutions for Today and Tomorrow and SMART TALK… about your insurance options. And if you have any questions about securing insurance for young Canadians, be sure to contact your local Collaboration Centre. We are here for you! Angus Reid Institute. Caregiving in Canada: As population ages, one-in-four Canadians over 30 are looking after loved ones. Angus Reid Institute. April 12, 2019. Specialty Life Insurance. How Much Does the Average Funeral Cost in Canada? 2022. Speciality Life Insurance. July 15, 2022. Currey, Tom and Rack, William A. Jr. 5 Things That Cost the Same (or More) as Life Insurance. Life Happens and LIMRA. August 26, 2021. Compulife Quotation System June 12, 2023.

Between 2020 and 2030, there will be a huge intergenerational wealth transfer in Canada – over $1 trillion (1). As an Advisor, are you positioned to take advantage of this transfer of wealth? If you have mature clients, you understand the unique issues and lifestyle decisions that they face and how these decisions can have a significant impact on the value and transmission of their wealth. As their Advisor, you are in a position to offer unique perspectives and solutions that can make a difference. Let’s take a look at a typical scenario. Alice, 79, lives in the family home where she raised her children Louis and Sandra. She has always been independent, but since the death of her husband a few years ago, she is experiencing loneliness combined with a loss of mobility that have made it increasingly difficult to live on her own. After lengthy discussions with both her children, Alice decided that the time had come to sell her home and move into a retirement facility. In the current real estate market, her house sells for over $500,000 and overnight, Alice finds herself with a significant amount of money to invest. Her wish is to leave the largest possible inheritance to her children, and that the money be passed on quickly and easily in order to avoid conflicts between Sandra, whom she has appointed as executor, and Louis, who might be eager to receive his share. Believing she was doing the right thing, Alice invested her half a million dollars in Guaranteed Investment Certificates (GICs) with her bank which she assumed to be the best solution. After all, she thought, you should buy what you know. In an alternative scenario Alice meets with Peter (her daughter Sandra’s Advisor) with both her children, to find a simple way to ensure that her wish is met and, that her funds are transferred to her heirs when she passes. Peter, the Advisor, explains that money held at the bank in GICs is considered part of the estate. Other personal assets like real estate, and even other investment products such as securities and mutual funds are also considered part of the estate. The settlement of an estate can be a long and complex process that can keep funds tied up for months or longer, during which time the executor cannot pay any money to their heirs. This situation doesn’t align with Alice’s wishes, so what are her options? Peter suggests that she consider investing the money in a segregated fund contract, a product similar to mutual funds, offered exclusively through insurance companies. The solution protects the capital and allows the money to be passed on quickly and easily when the owner passes away, often avoiding conflicts between the heirs, as per Alice’s wishes. But how? First and foremost, a segregated fund contract allows investors to subscribe to a guarantee for their invested capital, from 75% to 100% on the maturity date and in the case of death, ensuring some protection against the downturns in the investment market. Depending on the insurer, it is possible to subscribe to such a contract until the ages of 80, 85 or even 90. In addition, some insurers offer the option of protecting investment gains through resets, allowing contract holders to add their gains to their invested capital, locking in a new higher guarantee at a later maturity date. And as with life insurance policies segregated fund contracts allow for beneficiaries to be named to receive the proceeds at death, bypassing the estate process, and allowing for direct payment within a relatively short time frame. Peter was successful in presenting Alice with a viable option to achieve her goals of capital protection and a simplified and timely estate settlement for her children. Also… Peter has now become Alice’s Advisor; that’s a win! The opportunity in the senior market is huge and as an Advisor, you want to be part of it. If there is one group within our population that has been underserved in terms of financial advice, it is the senior market. The truth is that the pandemic made face-to-face meetings with mature clients more risky and asking them to access and use technology for virtual meetings has been a challenge. Hopefully, the improved conditions now making face-to-face visits possible will allow for some catch-up as the need for estate planning advice has never been greater. You may be thinking that you don’t have many seniors like Alice in your client base. Maybe, but one thing is for sure, you have access to their children and can certainly influence decisions there. Here is a simple prospecting idea. Systematically ask each of your clients the following question: Are you the executor of your elderly parent’s estate? This should set the stage for a meeting between you, your client and their parent to discuss estate planning, answer their questions and discuss possible solutions for an easy transfer of wealth. Don’t sit on the sidelines… take advantage of the great wealth transfer today! For similar articles and videos about estate planning, read and share Learning From Experience: The Carte’s Story and INFOclip: Transferring Wealth to Future Generations. And if you have any questions, please contact your local PPI Collaboration Centre. Manulife Private Wealth. Preparing your family for the great wealth transfer. Manulife. October 2, 2020.

When inflation is in the news there is increased focus on guaranteed interest type products, namely, annuities. But what exactly is an annuity and how does it work? An annuity offers your client, the investor, an opportunity to relinquish a lump sum of money in exchange for a guaranteed periodic level cash flow. The periodic amount your client receives is based on their age, gender and prevailing market rates. There are two main types of annuities: a “term certain annuity”, where a period of time is specified for the cash flow and a “lifetime annuity” where the cash flow is guaranteed for life. In either case, the market risk is taken out of the equation as the cash flow is guaranteed for the pre-determined amount of time. Here are a few more factors to consider with your client: The Risk Averse Investor A risk averse client entering their retirement years might buy an annuity in their Retirement Income Fund (RIF) which will ensure that they receive a guaranteed amount during their retirement years. While this amount may not be as high as it could be if the client were to take on some risk, the amount is guaranteed and can offer the peace of mind that comes with guaranteed cash flow. Annuity Settlement Option When the annuitants to a segregated-fund contract pass away, the assets will flow to their beneficiary. In some cases, there may be concern about whether the beneficiary can manage a large lump sum of cash. In these instances, the annuity settlement option can make sure that once the annuitants pass away, the beneficiary will receive level, periodic cash flow on a monthly/quarterly/yearly basis for a certain term or for the remainder of their life. A Hybrid Approach A long-time employee of a company will often receive a defined benefit or defined contribution pension plan as part of their benefits. When an employee leaves their place of work, they are typically offered a few options regarding what to do with their pension. The first option is to commute the pension to a Locked-in Retirement Account (LIRA), construct a portfolio and take on some risk; drawing income as needed so long as the yearly income amount exceeds the client’s RIF minimum. The second option involves leaving the pension as is and taking the income outlined in the client’s pension documents. Lastly, the client may be able to receive the same cash flow as outlined in their pension but do so using a smaller capital requirement resulting in a lump sum returned to the client – a hybrid strategy. For this latter option, your client would provide their documents to an insurance carrier and the carrier would run a proposal to mimic the cash flow but do so with a smaller capital investment. Whether or not an insurance carrier can offer a superior pension is contingent upon a host of factors, which we encourage you to discuss with your local PPI Wealth Team. Guaranteed Lifetime Withdrawal Benefit Some carriers offer a “Guaranteed Lifetime Withdrawal Benefit” (GLWB) segregated fund contract; this product tends to be popular when interest rates are high. A GLWB can be thought of as a hybrid between a segregated fund and an annuity. The client will deposit a lump sum and be guaranteed a cash flow for the remainder of their life, but this cash flow will be generated from a diversified portfolio in a segregated fund wrapper. This type of solution offers all the benefits of a segregated fund like creditor protection, named beneficiaries on unregistered accounts, death and maturity benefits, etc., and also provides guaranteed cash flow like an annuity. Additionally, there are oftentimes provisions in the contract that increase the amount paid to the client as they age and income can be forgone in a given year to increase the income in subsequent years. Definitely a few options to consider when it comes to annuities. In a higher interest rate environment, annuities and their variations certainly have their advantages and can be viewed as another option available to your clients and their loved ones. For a similar article, read and share the client-friendly version of Inflation, Interest Rates and Your Client’s Investments. And if you have any questions about any of the topics discussed, contact your local PPI Collaboration Centre.

As your client’s life circumstances change, so do their financial obligations. Maybe they’ve already paid off their debts and achieved all of their wealth goals – impressive! But what happens to your client’s life insurance policy if it is no longer required to cover financial risk? Well, they can certainly choose to cancel their policy, but what if there was a more meaningful option? One way is for your client to donate the proceeds of their permanent life insurance policy to a charity of their choice. They will still be able to enrich their estate with the tax benefits of charitable giving, but they will also be able to have a significant impact on a charity’s ability to achieve its goals. Now THAT is meaningful! Watch this video and share it with your clients to help them understand their insurance gifting options, as well as the caveats involved in donating an insurance policy to charity. For a similar article about charitable gifting, read and share the client-friendly version of How Life Insurance Can Help Your Client’s Favourite Charity and if you have any questions about donating a life insurance policy to a charity, contact your local PPI Collaboration Centre.

“I have coverage at work”. This is oftentimes a client’s response when individual disability insurance is mentioned or suggested. There is no question that group Long Term Disability (LTD) is a valuable benefit to have, and certainly better than no coverage at all, but it may not completely solve the critical issue of income replacement or be a sufficient safety net. Unfortunately, people become ill and accidents happen. And when illness or accident does strike, it tends to be unwanted, unexpected and unwelcome. The most unfortunate part being that most people are completely unprepared for the financial setback that a disability can cause, leaving them without the income they need to support themselves and their family. Here are a few things for your client to consider when weighing additional disability coverage: Group coverage typically only covers base salary and not bonuses High income earners may be under-insured as most group LTD plans have built in maximums Group LTD usually does not include benefits for partial disability Most group LTD plans include a two-year regular occupation definition of disability, switching to any occupation thereafter Many people change employers and negotiate for increased salary/bonus but overlook whether insurance coverage is provided and the cost to personally replace that coverage (especially at an older age), may not be attainable Employers review employee benefits quite regularly and make adjustments to contain costs, so at any time, your client’s LTD plan can change LTD coverage isn’t portable, and there’s no guarantee your client’s next job or venture will come with LTD benefits Definitely more than a few things to consider. However, there are solutions to discuss with your client: Executive “Top Up” for an executive client or high-income earner who may be under-insured as a result of group maximums For non-executives, review the maximums under their benefit program, and consider a group top up or integration of benefits with group offset Consider combining LTD and Critical Illness as complementary products, and share with clients the different claim and payout processes Need a little help? Use the Income Replacement applet on PPI’s Toolkit Direct to educate your clients on the importance of income replacement coverage, as well as the gaps that exist within group LTD coverage. Those unwanted, unexpected and unwelcome events will strike – will your clients have the coverage they need? For similar articles, videos and tools on the importance of living benefits, read and share CIDI: Enhancing Your Client’s Benefits Package, Strengthening Your Safety Net with Critical Illness Insurance, Insuring Your Greatest Asset with Disability Insurance and SMART TALK… about living benefits. And if you have any questions or would like more information on insurance solutions for your clients, contact your local PPI Collaboration Centre.

Family traditions can make for great stories, particularly when everyone gathers and recalls the birth of a tradition and the events that have kept it alive. In this installment of ‘Learning from Experience’, what could have been an inconsequential find, became a beloved family heirloom that sparked a decades-long tradition and a treasure trove of fond memories. Proper planning has poised the family tradition to live on for generations to come. Share Rimba’s story with your clients to get them thinking ahead to the distribution of their own family heirlooms and valuables like digital assets, antiques, gems, and artwork. Whether their assets have sentimental value, or great financial value leading to conversations about estate equalization, Rimba’s story may get them thinking beyond the obvious when it comes to planning for the future. For more information on planning for the preservation and transfer of assets, watch our short videos: INFOclip: Protecting Your Estate, SMART Talk… about digital assets, and SMART Talk… about will planning and drafting Questions? Contact your local PPI Collaboration Centre.

We have all been there… after a great conversation with a client, you submit their insurance application only to find out a few weeks later that the application cannot be approved as submitted. Either there’s a rating for additional premium or the client is outright declined. Either way, it can be a tough pill for the client to swallow and accept; especially because they most likely perceive themselves as completely “healthy”, regardless of the medications they may be taking. So, what can you do to avoid these types of disappointments, or to help them out when no one could have seen it coming? You may be able to manage expectations and minimize the likelihood of an underwriting ‘surprise’ by asking some basic field underwriting questions. You don’t have to go through the full medicals to get a complete picture, but here are some questions you can start with: What medication(s) are you taking today and for what reason? When was the last time you were hospitalized and for what reason? When was the last time you had to take time off work due to medical reasons? There are a number of great tools available for Advisors affiliated with PPI to help set expectations when field underwriting reveals medical conditions that may impact the outcome of the application (Advisor login required). Know the Risk includes several rating guides covering a variety of medical conditions, offering you and your client insight into how underwriters may evaluate their condition and the potential impact on their rates or insurability. If you want further assistance setting expectations, complete and submit a Lifestyle and Health Preliminary Evaluation form so PPI’s advanced Underwriting team can provide you with a preliminary risk opinion on how the case may be assessed by the carrier​. And for assistance positioning your cases in the high net-worth market, you can complete a Lifestyle and Health evaluation form and our team will conduct detailed fact-finding and analysis, and package the case for presentation to the insurer. Finally, in PPI’s Toolkit Direct you’ll find a helpful document called “What to Expect When You Apply for Insurance”, that explains to clients the processes and timelines associated with applying for insurance. Now, what if your client has received an unforeseen rating or decline? If you want assistance explaining the decision to your client, turn first to Know the Risk to see if their condition is covered in one of its many rating guides. And if you need support on a particularly difficult case, contact your local PPI Collaboration Center to discuss: Carriers specializing in difficult to ensure clients – there are always options How you can reach out to the carrier underwriter directly to review the case If we can have the case reviewed by an internal PPI underwriter (requires client authorization) PPI has been quite successful in facilitating either immediate or deferred insurance to many clients who would otherwise be without any coverage, so be sure to reach out! So, by asking a few field underwriting questions up front, knowing where to find resources to help manage and explain potential ratings, declines or exclusions and finally knowing that there’s an option available regardless of what comes up, you should be well equipped to help clients attain the insurance coverage they need. For a similar article on clients who are a little more complicated to insure, read and share You Have More Insurance Options Than You Think. At PPI, there is always a solution.

For the majority of families, life insurance needs will change over time. Typically, more coverage is required while your client’s family is still young and building their wealth, with a decreasing amount required as the family finances mature. Most life insurance policies are designed to provide a level amount of coverage for the lifetime of the policy, making it challenging to fund the policy on an ongoing basis. However, if you’re considering the best overall solution for your client, the decision between term versus permanent insurance doesn’t have to be an either/or situation – your client can have both! Oftentimes, the best insurance protection can come from a Term/Perm combination – that is, a small amount of permanent insurance, PLUS a term rider to cover the remaining amount, or two stand along policies. With this Term/Perm blend, you can ensure that your client’s coverage is tailored to their lifestyle over time and fits their initial budget. Your client gets an ample amount of coverage in the initial years of their policy, while knowing they have some amount of coverage for the duration of their life, providing them with maximum flexibility. So, what are some of the benefits of recommending a small base plan of permanent insurance coverage to your client? Coverage that is aligned to their fluctuating needs over time Potential for a lower total cost over time At renewal for the term rider portion or separate policy, the client has options to renew, convert, reduce, drop and/or add other coverages – options are important! Lock in permanent rates TODAY to guarantee the cost of the permanent coverage for life The possibility of some plans to build cash values to support “premium vacations”. The fact is that the earlier in life that a client purchases permanent coverage, the greater the impact it can have as a financial instrument in their overall financial plan. PPI’s here to help. Our Toolkit Direct has two applets that can assist you in this process: Insurance Needs Analysis (INA): identify and explain the difference between Temporary and Permanent Needs Life Insurance Funding Options: offer your client four options – term only, permanent only, some permanent with the remainder as a term rider, or both term and permanent stand alone policies (the Term/Perm blend) Start the conversation with your clients today to set them up for success into the future. For similar content on term versus permanent insurance, share Exploring Your Life Insurance Options, The Ultimate Planning Tool, INFOclip: Understanding Term Insurance and Choosing Insurance That Grows with You. And if you have any questions about the Term/Perm blend of insurance or how to position it to your clients, contact your local PPI Collaboration Centre.

When primitive men and women discovered fire, it changed their very existence. Food and shelters could be heated, not to mention providing illumination and some degree of protection from the animal kingdom predators that roamed the planet. Not quite as dramatic except to those of us in the life insurance industry, the employment of actuarial science in the late 17th century provided kindling to the underwriting fire. This included the production of life tables and application of compound interest to the challenge of calculating the present value of the future liability, the very foundation of life insurance premiums. What does this have to do with gender? In the early days, not very much. It was all an actuary could do to wade through individual birth and death records to calculate premiums based on the still most important risk factor, the age of the life being insured. No distinction between male and female was made and, as a result, unisex pricing was the norm. Around 1880, the rate of male mortality started to rise and astute actuaries the world over eventually began to reflect those differences in the pricing of life insurance rates. (1). The mortality/gender gap is especially pronounced in older lives, where 57% of all those aged 65 are female and by age 85 women make up 67% of the population (2). In Canada, women, on average, live 4 years longer than men, making the actuarial argument that men should pay more for life insurance (3). While Canadian insurance companies take these differences into account when pricing life insurance, it is not always the universal view. Since 2012, the European Union prohibits pricing based on gender for life, health and even auto insurance, raising the age-old question of fairness; should a lower risk group, in this case women, subsidize the higher-risk group, male policyholders (4)? The question of why women outlive men, at least on average, continues to be of interest. The early observations, that smoking and cardiovascular disease are the main culprits remain true today. We also have a deeper understanding of the role of stress, as well as the behavioural and cultural patterns that may predispose men to take more risks, drink more alcohol and seek medical care less often. This latter point is particularly pernicious as although women are often thought to be diagnosed more often with depression, men generally have much higher suicide rates (5). This was highlighted most recently when United States Senator John Fetterman was hospitalized voluntarily for depression, drawing praise for making his struggle with mental health public (6). Contrast this with Thomas Eagleton, also a United States senator in 1972 and Vice-Presidential candidate dropped from the ticket a week after disclosing treatment for depression in his past (7). Today’s discussions on gender run deeper than the traditional female-male divide. New perspectives on gender identity, roles and their impact on health bring new understanding and continue to evolve. Watch this space as we share more on this topic. Crimmins, Eileen et al. Differences Between Men and Women in mortality and the Health Dimensions of the Morbidity Process. Clinical Chemistry. Volume 65, No. 1, 2019, pages 135-145. Shmerling, Robert H., MD. Why men often die earlier than women. Harvard Health Blog, health.harvard.edu. June 22, 2020 Statista.com. Life expectancy at birth in Canada from 2010-2020 by gender. September 2022. Fontinelle, Amy. Gender and Insurance Costs. Investopedia.com. July 25, 2022. Mental Health and Suicide in Canada-Key Takeaways. Mentalhealhcommisison.ca. July 6, 2022. Barry, Ellen and Gay, Sheryl. Fetterman’s Disclosure of Depression Signals New Openness on Mental Health. Nytimes.com. February 17, 2023 Greenfield, Jeff. What John Fetterman Should know About Thomas Eagleton. Politico.com. February 17, 2023.

As an Advisor, you probably get this question all of the time: which is more important, disability or critical illness insurance? But as an Advisor, you also know that both types of insurance can be equally important and most clients should have both in their insurance portfolio. Disability insurance (DI), whether part of a group plan or even as a stand-alone policy, generally will not cover a client’s full income. This is a concern since out-of-pocket expenses typically increase anytime something medically prevents people from working for an extended period of time. Likewise, any additional supplemental costs may only partially be covered by your client’s health insurance – depending on their coverage. Your client could be faced with a shortfall even with full disability coverage; this is where critical illness (CI) can help fill the gap. Medical expenses currently rank as the number three cause of bankruptcy in Canada. Despite this, CI sales continue to get outpaced by life insurance quite dramatically in Canada. In fact, in 2022, only 8% of insurance applications were for critical illness insurance. This gap signifies an opportunity for you, the Advisor. Below are some typical concerns that your client may express and how to address them when discussing the prospect of bundling CI with a DI policy: I already have disability insurance; do I need critical illness too? Your client has existing DI coverage already – that’s great! However, since they are fundamentally different products with different claim triggers, consider the possibility of claim for each. Would the disability pay out if the illness returns them to work before the elimination period? Would the critical illness pay out if they are off work due to an injury? Even if one pays out, will the income be sufficient? If both policies paid out, it wouldn’t be the worst thing that happened, and it would also help to support any increase in monthly expenses, whether caused by inflation or unexpected medical expenses. Remember, despite the overlap, both products cover off very different needs. Critical illness insurance is too expensive! Insurance companies price their products according to risk. If there’s an elevated risk we can expect higher premiums, whether it’s related to age, health status, or in this case the product having a higher claims rate. Regarding how to approach this with a client, discuss how they can fit it into their budget at a price point that they are comfortable with. Sometimes, Advisors jump straight to a T75 with return of premium (ROP) and a $100,000 benefit because somewhere along the way, this became the industry approach. And while longer term products with ROP features may look attractive to some, for many people they are too costly. Looking at term insurance for CI is a very viable option. Likewise, compared to life insurance renewals, the premium renewal jumps are relatively less significant. There have in fact been cases where the first renewal cost is LESS EXPENSIVE than a new attained age quote (so unless premiums go down over the next 10 to 20 years, this can actually lock in a better rate for some). How much CI is enough? There is no right answer to this question but many successful Advisors can, for example, either focus on a multiple of income (like 1 to 2 times annual salary), expenses over a fixed period, or whatever fits the client’s budget. It’s much more difficult to do a needs analysis on CI than life insurance as there are more moving parts such as recovery period, cost of procedures, medication, unpaid leave from work, etc. Regardless of what method used, even some CI coverage is better than leaving your clients completely at risk – even if it’s $10,000, this amount could make a difference, be a  relief, between when their income ends and their DI begins. I will self insure. Using personal savings, family income, or taxable investments such as RRSPs may seem like a good idea but typically it becomes the more costly way of dealing with additional expenses. Simply put, self insuring is generally not the better option. Nothing is going to happen to me! Manulife has a tool called What’s Your Risk, which takes industry statistics and calculates the odds of a life, CI, or DI claim for a specific client based on their situation. It’s a good exercise to go through with your younger clients (or yourself if under 50). In fact, go over your own reporting over the last few years to explore what percentage of sales included some component of critical illness. Once you have these stats, go back to your clients that have not yet acted on this need. Also consider going back and looking at your files to review whether an injury or illness could derail any planning you’ve done for your clients. If you haven’t been talking about CI or DI, now is the time to consider their many benefits and have those valuable client conversations. PPI offers a number of client-friendly tools and calculators that you can share with your clients to help start those important conversations – check them out on The Link Between, then share! Need help running insurance reports or have questions concerning your client’s insurance options? Contact your local PPI Collaboration Centre.

A lot has changed over the past 30 years – the world in which our mothers and grandmothers lived is certainly not the same as the world in which our daughters and granddaughters will continue to live. And although this industry has seen some much-needed changes over these decades, we still have a lot to learn when it comes to our women clients and their financial needs. It seems obvious, but there are things that make a woman client different from a man client. In response to that, your sales style, sales process, assumptions and sales strategies may be different when communicating. The truth is that the future success of your business could depend on understanding that there are indeed differences and acting accordingly. Why are women clients important in the financial realm and the future of your business? Women breadwinners and the $71 trillion transfer of wealth Women are becoming more and more powerful on a professional and financial level and are becoming the decision makers that Advisors now need to recognize. In fact, “today, women are the primary breadwinners in over 31% of households in Canada. By 2024, they are anticipated to control about $2.7 trillion of the country’s total household wealth. Looking further out into the next several decades, they stand to receive 70% of intergenerational wealth transfers totalling $71 trillion (1).” Up to 80% of women find a new Advisor after the death of a spouse Did you know that up to 80% of women find a new Advisor after the death of a spouse? It’s true! “An estimated 80% of women leave their Advisor within 18 months of becoming a widow. Often, this is because they don’t feel the Advisor has taken the time to build a relationship with them (2).” The truth is that women clients aren’t worried about where their Advisor is on the gender spectrum. What they’re seeking is an Advisor who recognizes that they are also an individual, even if they are part of a committed couple. They’re looking for an Advisor who works with them in a supportive, collaborative, and holistic way, as well as one who can notice and adapt to the nuances of working alongside a woman client. Women are really great clients! Once you earn their trust and add solid value, women are more likely than men to seek out the advice of their trusted Advisor for ALL their financial needs, which opens a broad spectrum of opportunity for you. Once they have decided you are a good fit, women clients are less likely to leave you than men clients, with some sources indicating that women clients are even more willing to refer you to their friends and family (3). What can you do to support your women prospects and clients? See, hear and advocate for a woman client It sounds basic, but do you require that both heads of the household attend a planning meeting? Financial decisions impact the futures of both so be sure to advocate for your women clients to ensure they can participate in a meaningful way. Building this relationship will benefit your practice in the future and, for your women clients, if you are their Advisor (and not just their partners’ Advisor) it will ease the financial planning transition caused by a future marital breakdown, the incapacity or death of their spouses. Become their Advisor. Women have a longer life expectancy On average, Canadian women live longer than Canadian men by approximately 3.5 years (84.74 vs 81.15), and many are living past age 90 (4). As you project into the future to determine income needs in retirement, ensure these extra years are covered for your women clients. Also, consider longevity when working with an older client who has requested term insurance. PPI offers this handy Life Expectancy Chart to assist you in conversations about life expectancy and longevity. With increased longevity also comes an increased likelihood of needing additional insurance; a good CI plan that covers cancer and other illnesses could be extremely valuable in later years when retirement funds might be starting to run low. Women, child rearing, and elder care While numbers might be edging upwards for men who become the stay-at-home parent, women are still four times more likely to take on this role (5). Women are also far more likely to reduce work hours, take time off or leave work to care for aging parents. In fact, adult daughters provide twice as many elder-care hours to aging parents as adult sons (6). These breaks in employment have a serious impact on the financial future of a woman. According to one 2018 study, “stay-at-home parents are half as likely to get a job interview than parents who have been laid off. […] And the mothers who do find a job are often penalized for their time away. […] [W]omen who spend three years or more out of the workforce lose 37% of their earning power. [And] study after study has shown that even the women who do successfully re-enter the workforce after a career break never fully catch up to their earnings potential (7).” As an Advisor, it is your responsibility to look through the financial risk mitigation lens of a woman who is a single income earner, who divorces down the line or whose partner dies or becomes unable to earn an income. Speaking to all parties and walking through a thorough needs analysis is imperative – your woman client’s entire future financial security could depend on it. In cases where the partners are the primary breadwinner, women clients may never be able to jump back into a career and regain their earning power, so it’s critical for the breadwinners to have the correct amount of life insurance and disability insurance. Income replacement must be adequate not only for expenses while rearing children, it should also provide enough to save for retirement. If you are meeting with a couple where one member is the stay-at-home parent/caregiver, make sure you ask them to describe the tasks they undertake daily and then help them both come to an understanding of the financial impact of the caregiver’s premature death or disability. There is significant financial value in what both partners do. Single-income households For single income households, financial responsibilities rest on their shoulders alone, hence your advice should look different than for a two-income couple. For a single person, mortgage insurance may or may not be a high priority, whereas DI and/or CI coverage, and a solid retirement plan, may be higher on the list of priorities, because their bills rest squarely on their individual shoulders. Be the change Of course, we’re only just scratching the surface of what you can do as an Advisor to help your women clients with their holistic planning. There is huge potential in the women’s market. Today there is a huge number of women clients looking for an Advisor who understands them – can you be that Advisor? If you’d like to learn more about opportunities within the women’s market, see this Planning Opportunities in the Women’s Market video. And if you have any questions or would like to know more, contact your local PPI Collaboration Centre. Almazora, Leo. Are Canadian women entering an age of financial empowerment?v Wealth Professional. March 8, 2021. Advisor’s Edge. Why it’s important to connect with female clients. Advisor’s Edge. March 8, 2018. The Voice of the Investor. Why Women Use Financial Advisors More Than Men. February 16, 2021. Life Expectancy of the World Population. Worldmeter. March, 2022. Honderich, Holly. Why ‘stay-at-home parent’ is a job title. April 14, 2021. Almazora, Leo. How the gender pay gap adds up over women’s lifetimes. Wealth Professional. May 16, 2018. IBID.

It’s hard to imagine an industry that has a greater positive influence in society than ours. You as an Advisor truly make a difference – you are there to help your clients when they are going through their most difficult moments. In spite of this, there remains a perception that an Advisor’s focus can be to make a commission. However, if you’ve managed a claim on behalf of a client, you know how unfair that idea can be. It is also not reflective of the genuine value Advisors provide to Canadians every single day. At its core, “what” you do is really quite simple: you provide access to insurance planning, as well as potential investment and financial planning, to your prospects and clients. That’s important for sure, but is it emotionally compelling? Most people would say that it’s not. However, the reasons “why” people go through the financial planning process are often rooted in love, compassion and consideration and that is the truly compelling part. Yet, sometimes Advisors focus on the “what”, rather than the “why”. If asked about the role, it can be difficult to articulate the value you bring in an emotionally compelling way – even after years of being successful in the business. One method salespeople have implemented to try to overcome this difficulty is to formulate the dreaded elevator pitch. The idea is that if you only have a few seconds to grab someone’s interest, you have a pitch, a spiel, that can be delivered quickly and repeatedly. But is this genuine or does it come of as contrived and forced? You can do better than a tired sales pitch! Instead, consider your “Why Statement.” This can be used as a brief introduction to someone, but ultimately is designed for something more significant. The advantage is that you develop something that truly resonates with who you are, that speaks to the passion and commitment you have towards your work – you share the emotional undercurrent of your practice. For sure there is a part of the process that touches on “what” you do, that is still important, but the driving sentiment is focused on “WHY” you do “what” you do. The process towards building this involves defining yourself in ways that might be very different from what you are used to. But this endeavor, while challenging and time consuming, is very much worth the effort. This approach helps many Advisors speak with confidence and certainty about the work that they do, as well as the value they bring to their clients and prospects. Once you’ve come up with your “Why Statement”, you of course will need to practice the delivery so that it comes across concisely and with the sincerity that it deserves. From here, your statement can start to form an integral part of your prospecting and referral process. It can be recorded and streamed on your website, offered as a link to new prospects or delivered as the first portion of new client meetings. We all know that clients make decisions based on trust and emotional connection, so doesn’t it make sense for your process to incorporate strategies that are specifically designed to connect on those levels? Articulating your “why” is not only a tremendous way to refocus your purpose, but a constructive way to show your value to clients. It will also allow you to set yourself apart from the masses – and you can use it as a springboard to re-engage with existing clients. Without a doubt, this can be a very challenging industry at times. Doesn’t it make sense to take advantage of new ways to define yourself as the trustworthy and passionate Advisor that you are? If you have any questions or are interested in exploring this idea further, be sure to contact your local PPI Collaboration Centre.

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