NAIFA Amarillo Area Newsletter

Transcription

1 N A I F A A M A R I L L O A R E A NAIFA Amarillo Area Newsletter April 2013 Volume 7, Issue 9 Inside this issue: President s Message Monthly Luncheon Info NAIFA Texas Elections NAIFA Notices 3 NAIFA in Washington DC 3 MDRT Minute 4 Contact Info & Awards 5 NAIFA Amarillo is now setup on a texting program! Text NAIFA to to be opted in to receive text reminders for upcoming meetings and events! President s Message April showers bring May flowers, isn t that what they say? How about April snow or an April freeze? As I m writing this message we are due to have winter weather AGAIN this week after a beautiful Easter weekend! Hope this finds all of you well and back at work from both Easter & Spring break. A subject near & dear to my heart about NAIFA is to be the topic of discussion this month. NAIFA is, if nothing else, an advocacy arm for our business. We need to keep that in mind. One of the most important activites any professional agent can do is to support their industry so that they still have one! I have taken on that role--first for my own livelihood, then for my community, and now for Texas, by becoming involved in NAIFA. Many of our colleagues don't know that we are now in a fight for insurance--life & annuity business--as we know it. For 100 years, NAIFA has been involved in saving our industry and in making sure our clients -- all 75 million families-- are protected. We need to educate them. In 1913, the first income tax was to come into being. While all of the issues were being discussed, NAIFA (then NALU) made a last minute deal with the Wilson administration to keep life insurance death benefits & inside build-up of cash value to not be taxed. The entire story is presented in the link below; it's a 7 minute video that explains what our early patrons did in order to benefit the consumers we sell to--to keep benefits going to the families and NOT to the government in the form of taxes in order for the average family to protect and provide for itself in the event death of the family breadwinner. news/340-naifascongressional-conference One hundred years has passed and the same issues are being targeted in the US Congress as we speak. My point with all of this is that we as merchants of life insurance and fixed indexed (tax-deferred) annuities have a big bull's eye on our backs. The Obama administration needs to get money from somewhere to pay for the bailouts & Obamacare, and our industry provides many tax-advantaged products. Who better to get money from??!!! We MUST take action to fight these unfair & expensive and unfair "reforms" to keep them from taking place. Kirk Haworth, John Denton & I will be in Washington DC on April 8-9, visiting our representatives on Capitol Hill to try to protect our industry from having many of our tax-favored products from being on the chopping block of Tax Reform from the Obama Administration. My hope is that you as NAIFA members who understand our advocacy benefits, you will be willing to get involved by, at the very least, call/fax/ your Congressman on April 9th to express their concerns about the tax reform bills before Congress. Templates will be provided. Lindsay will send out an again to make sure you have an easy way to contact your representatives and know exactly what to say. Thanks for all your support. This is very important, not only for us as a business, but more importantly for that mom who has to raise 4 kids on the benefits of a $100,000 life insurance policy -imagine if the government reduced it via taxation to only $75,000. Do you think that would make a difference how she could live and raise those kids? Thank you from the bottom of my heart! Blessings, Hollie Gandy NAIFA Amarillo President

2 Page 2 April Luncheon: 11:45am This special video program is titled The Top Five Ethical Challenges Facing Producers Today and is a part of a series of programs produced by NAIFA, for delivery to NAIFA members. NAIFA s newest Programs in a Box is a panel discussion produced in conjunction with IMSA. Presenters include Brian K. Atchinson, Marvin H. Feldman, CLU, ChFC, RFC, Donald J. Walters, Lisa Laliberte, CLU, ChFC, CASL, Randy L. Scritchfield, CFP, LUTCF, John N. Travagline, and David F. Woods, CLU, ChFC, LUTC. Ethics may be something you learned about a long time ago and regard as a static approach to conducting business. But in a changing marketplace, the ethical lines can sometimes blur, leaving well-meaning agents and advisors to make ethical mistakes unintentionally. Meeting Location: The Amarillo Club 30th Floor Meal Catered by: The Amarillo Club NAIFA 2013 Annual Conference to Take Place in San Antonio Registration is open for the NAIFA 2013 Career Conference and Annual Meeting at Plan now to join your NAIFA family in San Antonio, Texas September 28 - October 1. Register early to save on your conference registration, and act now to reserve your hotel room at an extra special rate. Plus, when you book your stay at an official NAIFA Conference hotel, you will save $100 off your conference registration. NAIFA 2013 will take place at San Antonio's Henry B. Gonzalez Convention Center. The headquarters hotel is the Grand Hyatt San Antonio adjacent to the Convention Center at 600 E. Market Street. NAIFA has secured a block of rooms at the Grand Hyatt at the special NAIFA rate of $199 per night plus tax. While on the conference website, sign up to receive updates. You can receive the latest news and updates about NAIFA 2013 as they become available. Texas President Doug Massey has set goals of being #1 in membership, #1 in IFAPAC contributions, and #1 in attendance when Texas hits the national stage come September. Lets help NAIFA-Texas achieve those goals!! We'll see you in San Antonio!

3 Page 3 NAIFA Notices Did You Know? Do to the increasing price of our luncheons, we will no longer be giving first time guests a free lunch. Also, meals for guests will now be $15. Congratulations NAIFA Amarillo recently won a $400 state award for most retention in a medium sized chapter. Thanks to you all. Now, let's go after IFAPAC commitments & membership. Way to go!! Upcoming Events NAIFA Fly-In in Washington, DC April 8-9, LUTC Course We are looking into the possibility of teaching another CE course but we need interest from our chapter. If you are interested in going through the LUTC course, please let Lindsay know. We ll keep you posted. Thanks! NAIFA Congressional Fly-In in Washington, DC Our own, John Denton, Hollie Gandy and Kirk Haworth, are flying out this week to join 1,000 other professional insurance agents, advisors, brokers, consultants and employee benefit specialists from across the country in Washington, D.C., April 8-9 to meet with U.S. Senate and U.S. House members and staff as part of the National Association of Insurance and Financial Advisors Congressional Conference. Congressional Conference attendees will talk to their members of Congress about the importance of life insurance, annuities and employee benefits to the clients and the U.S. economy. Life insurance products account for 20 percent of Americans long-term savings. The life insurance industry pays out $1.5 billion each day and supports 2.5 million jobs.

4 MDRT Minute: Financial Risk Management in Today s Variable Annuity Market Financial risk management in the variable annuity industry has evolved considerably over the last two decades for a number of reasons, but perhaps most significantly because of the rapid pace of variable annuity product innovation. How does an advisor begin evaluating the risk management capabilities of a variable annuity provider? Overall strategy Traditional. Risk is managed primarily through hedging programs and by maintaining sufficient capital. Variable annuity providers pursuing this strategy are attempting to achieve two objectives. First, they are attempting to reduce financial risk by offering simpler products with reduced guarantees. Second, they are using simpler and lower cost products to appeal to clients who have generally not considered variable annuities because of concerns about fees or the perceived complexity of variable annuities. The adoption of this strategy by some variable annuity providers has accelerated after the financial crisis. Product-based. Variable annuity providers pursuing this strategy offer products with strong guarantees, a high degree of client flexibility, industry average pricing and a product-based risk management feature. One risk management feature is a self-governing mechanism that helps reduce risk in response to external market conditions. Examples are: a) a guarantee whose benefit growth rate is tied to an index such as Treasury rates; b) the use of a predetermined mathematical formula to transfer clients assets between equity and fixed-income investments based on the impact of market fluctuations on clients account values; c) the linkage of variable annuity rider fees to an external index, such as the Chicago Board Options Exchange Volatility Index (VIX). Similar to the traditional strategy, companies using the product-based risk management strategy also made product changes, such as reducing guarantees or increasing fees, after the financial crisis. Product design Product design plays a central role because it impacts both the types and the levels of risk that a provider bears. At the same time, product design determines how attractive a product is to advisors and clients. Less risky products enable providers to absorb significant asset flows into their products while maintaining financial risk at manageable levels. Also, less risky products reduce a variable annuity provider s dependence on outside risk mitigation practices, such as hedging programs and capital. Finally, a product that balances risk management and benefits to clients will be more attractive in the marketplace. Risk management Risk budgeting is the process of matching one s risk revenues (fees) with the risk management costs associated with the risks transferred. A risk budget can help guide product development efforts as to how much risk a provider is able and willing to absorb. The level of the budget is impacted by a number of factors, such as capital availability and a provider s overall risk tolerance. This budget consists of three risk buckets: 1. Longevity risk (also called mortality risk) the risk of people living too long 2. Client behavior risk risks related to how clients utilize variable annuity product features 3. Market risk includes equity, interest rate and credit risks Today, greater attention is being paid to how an insurance company manages its variable annuity risks. As a result, advisors must now incorporate risk management considerations into the already complex variable annuity selection process that they undertake on behalf of their clients. Understanding the major building blocks of financial risk management within the VA industry will help you feel more confident in the variable annuity products you offer to clients interested in guaranteeing a portion of their retirement income Jill Perlin, CFP, CLU, is a 25-year veteran of the financial services industry. Her experience includes positions in sales, marketing, product management, investment management and corporate tax, and spans a wide array of products. Perlin is a popular speaker and often requested by external broker dealers and industry organizations. Her articles and papers on many topics have been widely published and syndicated online.

5 NAIFA Amarillo Area Lindsay Haworth-Gomez Executive Director 6900 I-40 West Suite #160 Amarillo, TX Phone: Fax: If you or someone you know is interested in advertising with NAIFA Amarillo Area, or, if you would like more information, please contact our Executive Director at Our rate is $100 per year for a business card size ad and your ad will be seen in all 12 issues. We re on the Web!!! NAIFA Amarillo Area 2012 Awards 2011 National Quality Award Years S. Sean Saied, FIC 1 Danny Cathy 1 Landon Landry 2 Todd Selmon, FICF 4 James Baker 6 Kris L. Bosley, FIC 7 John Denton 11 Jack Fuqua, CLU 18 Darren Fincher, FIC 19 Samuel G. Saied, FICF 19 Michael Thomas, CLU 20 Robert Curl, CLU, ChFC 36 Joe Flores Million Dollar Round Table Years Kip Hutto 1 Sean Saied 2 Todd Selmon 9 Patrick Phillips 12 Michael R. Ruff Q 13 John S. Denton QL 16 Darren G. Fincher, FICF QL 17 **Samuel Saied, FICF 17 Kirk H. Haworth, CLU, ChFC QL 31 B. J. Gililland QL 34 Robert Curl 46 ** Denotes Top of the Table qualification