Failing to Check your Policies Every 3-5 Years

Early in my career, I was asked to speak to a women’s group of Caltech faculty -- a professor had died and forgot to change the beneficiary on his policy to his wife of 10 years. The entire proceeds went to his ex-wife.

An astounding number of policies are payable to ex-spouses or others whom the insureds would not have wanted to receive the proceeds. Children born after a policy was issued may not be named. 

  • Proceeds are payable outright to minor children. Would you want a 12-year-old to inherit $2,000,000? Carriers will not pay money outright to a minor. You would probably want that to be controlled by a trust. 
  • Several of my clients over the years have had a change of heart or circumstances regarding their adult children -- they want to use the proceeds for a college fund for their grandchildren or to benefit their spouse because family is living longer and on a much higher scale. 
  • The policy is owned personally and the insured's estate is well above the federal estate tax exclusion and dooms the insurance proceeds to needless estate taxes. 
  • The policy no longer meets their present needs.   
  • They cannot sustain the annual premium outlay, or it’s out of date and inadequate. 

The Solution:  Contact me and we will confirm with the carrier in writing (1) that the policies are in force, (2) the current owner and beneficiaries, and (3) current in force illustration to see how the policy is performing.

Honors

July 11, 2017, Kuala Lumpur, Malaysia - Dana Hollinger was appointed to the International Corporate Governance Network (ICGN), a global investor-led network with members representing assets under management in excess of $US26 trillion.

Dana’s Stories from the Crypt

Failing to Check your Policies every 3-5 years

Early in my career I was asked to speak to a women’s group of Caltech faculty, a professor had died and forgot to change the beneficiary on his policy to his wife of 10 years.  The entire proceeds went to his ex-wife.

An astounding number of policies are payable to ex-spouses or others whom the insureds would not have wanted to receive the proceeds.  Children born after a policy was issued may not be named. 

  • Proceeds are payable outright to minor children.  Would you want a 12 year old to inherit $2,000,000?  Carriers will not pay money outright to a minor. You would probably want that to be controlled by a trust. 
  • Several of my clients over the years have had a change of heart or circumstances regarding their adult children.
    • They want to use the proceeds for a college fund for their grandchildren.
    • Or to benefit their spouse because family is living longer and on a much higher scale.
  • The policy is owned personally and the insureds estate is well above the federal estate tax exclusion and dooms the insurance proceeds to needless estate taxes.
  • The policy no longer meets their present needs.
    • They cannot sustain the annual premium outlay, or it’s out of date and inadequate.

The Solution

Contact me and we will confirm with the carrier in writing (1) that the policies are in force (2) the current owner and beneficiaries, and (3) current in force illustration to see how the policy is performing.

Honors and Speaking Engagements:

  • June 25-27 Dana Point, CA - Global Indexing & ETFs 2017 at Monarch Beach Resort
    • Moderator: Dana Hollinger Board Member CalPERS moderating a panel on ESG:ETFS: A Niche Segment Matures
    • Lee Munson, CIO, Portfolio Wealth Advisors
    • Blair Duquesnay, 30 North
    • Perth Tolle, Life and Liberty Indexes
    • Dan Lefkovitz, Morningstar Indexes
  • July 10-14 Kuala Lumpur - Global Round-Up: Governance priorities and challenges in major markets
    • Dana Hollinger, Board Member CalPERS
    • Pru Bennett, Director-Head of Investment Stewardship APAC, BlackRock
    • Nicolas Huber, Head of Corporate Governance, Deutsche Asset Management, Germany
    • Sau Kwan, President E-Fund Management, China
    • Chaired by: PhilipArmstrong, Director of Governance, GAV

CalPERS’ Board Elects Dana Hollinger Chair of Audit and Risk Committee

CalPERS’ Board Elects Committee Chairs, Vice Chairs

Leadership will guide five Board committees for year ahead

SACRAMENTO, CA – The California Public Employees’ Retirement System (CalPERS) Board of Administration has elected the following chairs and vice chairs of key board committees:

  • Investment Committee – Henry Jones, Chair; Bill Slaton, Vice Chair

Jones was first elected to the CalPERS Board in 2007 by retired CalPERS members. He was re-elected to terms beginning in 2012 and 2016, and also serves as vice president of the Board. Jones is a retired chief financial officer of the Los Angeles Unified School District. He currently serves as a personnel commissioner for the Los Angeles Community College District, and is a board member of the Robert Toigo Foundation and the Pacific Pension & Investment Institute. Slaton was appointed to the CalPERS Board in 2012, and again in 2015 by Gov. Jerry Brown, to represent local government. Since 2003, Slaton has served on the Sacramento Municipal Utility District board of directors—three terms as its president and one term as vice president. He also serves on the Policy Makers Council of the American Public Power Association.

Other Investment Committee members are Michael Bilbrey, John Chiang, Richard Costigan, Rob Feckner, Richard Gillihan, Dana Hollinger, JJ Jelincic, Ron Lind, Priya Mathur, Theresa Taylor, and Betty Yee.

  • Finance & Administration Committee – Richard Costigan, Chair; Theresa Taylor, Vice Chair

Costigan is serving his seventh one-year term on the Board. He was elected by the State Personnel Board in December 2010, and continues to serve as its ex-officio member. He served as deputy chief of staff and legislative affairs secretary to Gov. Arnold Schwarzenegger, and is senior director of State and Government Affairs for the national law and consulting firm of Manatt, Phelps & Phillips. Taylor is serving her first term, having been elected in 2014 to represent state members. She has been a CalPERS member for more than 20 years, and works as a principal compliance representative for the State Franchise Tax Board. Taylor is also the elected vice president/secretary-treasurer of the statewide Service Employees International Union Local 1000, where she oversees the organization’s $62 million budget.

Other Finance & Administrative Committee members are John Chiang, JJ Jelincic, Henry Jones, Bill Slaton, and Betty Yee.

  • Pension and Health Benefits Committee – Priya Mathur, Chair; Michael Bilbrey, Vice Chair

Mathur was first elected to the CalPERS Board in 2002 by CalPERS public agency members, and has been re-elected three times. She is a principal financial analyst for the Bay Area Rapid Transit District. Mathur serves on the Principles for Responsible Investment Board, and is a member of the Investor Advisory Council for Astia, a non-profit organization dedicated to the success of women-led, high-growth ventures. Bilbrey was elected to the Board in 2011 by active and retired members, and re-elected in 2013. He is the bookstore operations coordinator at Citrus Community College in Glendora, and is a former president of the California School Employees Association.  He also has served as vice president of the California Labor Federation executive council.

Other Pension and Health Benefits Committee members are John Chiang, Rob Feckner, Richard Gillihan, Dana Hollinger, Henry Jones, Theresa Taylor, and Betty Yee.

  • Risk and Audit Committee – Dana Hollinger, Chair; Ron Lind, Vice Chair

Hollinger, a 25-year veteran of the life insurance industry, was appointed to the CalPERS Board in 2014 by Governor Brown to serve as the insurance industry representative. She served on the Women’s Leadership Board to the John F. Kennedy School of Government at Harvard University from 2004-12, and is a sought-after speaker and author of articles on tax and estate planning. Lind is serving his first term on the Board as a 2013 appointee of the California State Senate and Assembly. He is a former president of the United Food & Commercial Workers (UFCW) Local 5 in San Jose. Lind also served as vice president of the UFCW International Union, a vice president of the California Labor Federation, and president of the South Bay AFL-CIO Labor Council. 

Other Risk and Audit Committee members are Rob Feckner, Richard Gillihan, Priya Mathur, Bill Slaton, and Betty Yee.

  • Performance, Compensation and Talent Management Committee – Michael Bilbrey, Chair; Richard Costigan, Vice Chair

Bilbrey was elected to the Board in 2011 by active and retired members, and re-elected in 2013. He is the bookstore operations coordinator at Citrus Community College in Glendora, and is a former president of the California School Employees Association. He also has served as vice president of the California Labor Federation Executive Council. Costigan is serving his seventh one-year term on the Board. He was elected by the State Personnel Board in December 2010, and continues to serve as its ex-officio member. He served in the administration of Governor Schwarzenegger as deputy chief of staff and legislative affairs secretary, and now is senior director of State and Government Affairs for Manatt, Phelps & Phillips. 

Other Performance, Compensation and Talent Management Committee members are John Chiang, Richard Gillihan, Dana Hollinger, Ron Lind, and Theresa Taylor.

  • The Board Governance Committee will meet in March to elect its chair and vice chair positions. 

Members of the Board Governance Committee are Michael Bilbrey, Rob Feckner, Dana Hollinger, Henry Jones, Priya Mathur, Bill Slaton, and Theresa Taylor.

Elected Board members generally serve four-year terms that begin January 16 the year after their election and end January 15.

For more than eight decades, CalPERS has built retirement and health security for state, school, and public agency members who invest their lifework in public service. Our pension fund serves more than 1.8 million members in the CalPERS retirement system and administers benefits for more than 1.4 million members and their families in our health program, making us the largest defined-benefit public pension in the U.S. CalPERS’ total fund market value currently stands at approximately $310 billion. For more information, visit www.calpers.ca.gov.

Calpers Braces for Lower Returns in ‘Most Challenging Market’

The California Public Employees’ Retirement System, the largest U.S. public pension fund, is ratcheting down expected investment gains over the next decade as low interest rates and a gloomier stock market depress returns.

The $306.2 billion pension fund expects an average return of 6.21 percent, which is 90 basis points, or 0.9 percent, less than the forecast two years ago, Chief Investment Officer Ted Eliopoulos said Monday at an investment committee meeting. The forecastcame from consultant Wilshire Associates, which issued a rosier long-term prediction: a 7.83 percent return over 30 years.

Calpers dimmed its outlook after reporting a gain of 0.6 percent in the fiscal year ended June 30, with losses in both stocks and forestland. That followed a 2.4 percent return in fiscal 2015.

“The next two years, the next five years, and perhaps the next 10 years are shaping up to be the most challenging market environment for us, for institutional investors and for pension funds going forward,” Eliopoulos said today in Sacramento.

Calpers investments must return an average of 7.5 percent over the next 30 years for the fund to meet its obligations to retirees without turning to taxpayers. The fund, as of 2014, had about 76 percent of the assets it needed to meet its long-term anticipated obligations, according to information on the Calpers website.

Calpers’ annualized returns were 6.9 percent for the last three years, 5.1 percent for the last 10 years and 7 percent over 20 years, according to a presentation to the board last month. It is among U.S. pensions under pressure to boost investment returns as funding shortfalls increase amid an aging population and low interest rates.

Stock Markets

Wilshire attributed much of its less-optimistic forecast to public stocks, the largest single category of Calpers investments at roughly 52 percent of the total fund value as of June 30. Stocks are likely to return an annualized 4.7 percent over the next 10 years, the Santa Monica, California-based consultant said, below Calpers’ 5 percent benchmark.

Eliopoulos said Calpers will adjust its asset allocations to cushion its holdings against the weaker-than-expected equity market.

Members of the investment committee called the forecast sobering and said it points to the need to review both the breakdown of the fund’s holdings and its 7.5 percent return assumption. Calpers officials have said the anticipated rate of return is still realistic, noting that investments have earned an average annual return of 8.3 percent since the current fund structure was created in 1988.

“I don’t think we can always rely on saying that markets are cyclical given that we’ve reached that inflection point,” board member Dana Hollinger said at Monday’s meeting.

Via Bloomberg: http://www.bloomberg.com/news/articles/2016-08-15/calpers-braces-for-lower-returns-in-most-challenging-market

Practical Steps to Reviewing Existing Life Insurance

Policy Payoff

There is $3 trillion in neglected wealth management—the amount of money held inside life insurance policy account values. The cash values held inside life insurance policies totals more than hedge funds, separately managed accounts and exchange traded funds. Yet, when it comes to life insurance policies, policy owners typically buy and hold—and the policy is never to be looked at until death do us part. However, most insurance policies don’t stay in force long enough to pay a death benefit.

Life insurance proceeds pay an integral role in the financial well-being and wealth of many of your clients. Imagine you’re the trustee of an irrevocable life insurance trust and you receive a notice from the carrier that the trust’s $5 million death benefit policy is going to lapse in 12 months, the insured is 82 years old and the premiums paid to date exceeds $1 million. An insurance trust can have a 40- to 50-year time horizon. Does the beneficiary have cause
to sue if the policy does not pay off?

The Moving Parts

Most people don’t realize that permanent life insurance has several moving parts. The cash
value has an investment element to it and the type of permanent policy will dictate what the
cash value is invested in. The initial premium projection is based upon the following variables
in underwriting: the mortality expense factor, the carrier’s administrative fees, the medical
class offer and the projected earnings (interest rate) on the cash value. The cash values of
identical policies issued by different carriers can vary with the performance of the portfolio of
assets held by the respective insurer to underlie the policy.

Two main moving parts are interest rate risk and mortality expenses, which are based upon actuarial life expectancy tables in effect when the policy was issued. Those tables are updated periodically. They were last updated in 2001 and did not become mandatory for the carriers to be put in full force until 2007. People are living longer, causing mortality rates to go down
significantly over time. It appears counter intuitive as people get older that they can actually save money on their life insurance by exchanging to a new policy that is being issued at an older age; but, they can.

The cost per $1,000 of insurance for a male age 50 based upon 1980 CSO Tables (used to price contracts today) was $6.71. The cost per $1,000 of insurance for a male age 50 based upon 2001 CSO is $3.91—a 42 percent savings. The only way to take advantage of that mortality savings is with a new policy issued on the updated mortality tables.

Historically, management responsibilities of an irrevocable life insurance trust consisted primarily of sending Crummey notices and paying policy premiums. Effective Jan. 1, 1995, California adopted the Uniform Prudent Investor Act and established that a trustee who’s charged with the responsibility for a life insurance policy must manage that policy just as it would any other investment. It’s the trustee’s responsibility to manage the assets of the trust in a prudent manner. Typically in an irrevocable life insurance trust, the life insurance policy is the sole asset of the trust. With a large enough face amount, the single greatest step toward implementing prudent asset management is to diversify the trust assets. That refers to avoiding asset concentration by placing all the coverage with a single carrier under a single policy form (whole life, universal life, variable life, etc.). 

A History of Efficaciousness?

Most life insurance policies written between 1980-2000 have not performed as projected as the financial models upon which they were based have not played out in the marketplace.
No one could have predicted that interest rates would remain flat for so long and no matter how well carriers hedged their portfolios, they could not hedge interest rate risk to zero. In addition, to gauge investment performance you need to review the following:

  • Is there an insurance policy management statement?
  • Is the policy properly owned and structured? I have seen many policies owned personally whose proceeds were intended to fund the estate tax liability.
  • Does the product match the goal? We don’t want to use term insurance where the liability has an indefinite duration, i.e., to fund the estate tax liability.
  • What is the status of the insured’s health?
  • If the policy is a variable one, then are the investments still appropriate? Do they need to be changed? Re-balanced?
  • Review offers from other carriers: How does the existing policy compare to comparable policies/other investments?
  • What is the rate of return at life expectancy? That should be the benchmark when using life insurance to transfer wealth.
  • Is the policy performing as it should? Have the original illustrations been compared to the “inforce ledgers” to determine if the policy is meeting expectations? Weigh options for use of cash value in a lump sum exchange or life settlement proceeds.
  • By redeploying the capital committed to the contract can we achieve a greater death benefit assuming the identical premium outlay?

Case Study

Joan, 59, and Bob, 61, own a whole life policy (taken out in July 1993) on Bob’s life with
a $2 million death benefit to Bob’s age 100 and $900,000 in cash surrender value. Bob
owns the policy personally and its purpose is to benefit their sons and fund the estate tax
liability on the last to die. They owe four more years of $43,000 in annual premiums. Bob
and Joan are in good health.

The policy will bump up the value of their estate since the proceeds will be subject
to estate tax. The policy was issued on 1980 mortality tables. The estate tax will trigger on
the last to die, which may or may not be Bob. What do the economics look like after
the audit?

A Form 712 (Life Insurance Statement) is ordered from the carrier to determine the value of the policy for transfer tax purposes. The policy needs to be transferred out of Bob and Joan’s estate to a newly created irrevocable life insurance trust for the benefit of their sons. Insurance carriers report the value of the policies for transfer purposes via gift or sale on Federal Tax Form 712. To get the policy out of their estate, the policy is sold to a newly created irrevocable life insurance trust for a note. We use the increased annual exemption to pay down the note over the next few years.

Once the old policy is inside the irrevocable life insurance trust, Bob and Joan get underwritten for a new joint life policy. When the new contract is put in force, Bob surrenders the old policy. There is no gain because the premiums he has paid into the contract do not exceed his basis. Then we redeploy the capital ($900,000 in cash surrender value plus
$43,000/year for four years) committed to their old policy to their new policy.

The new policy has a $6,561,181 in guaranteed death benefit to age 102/100. By taking advantage of lower mortality costs and using a survivorship policy, which compounds
our mortality savings, we can increase the return (death benefit) more than 300 percent. The face amount now contractually guaranteed by the carrier is $6,561,181. The sons are able to get an additional $4,561,181 in death benefits, income and estate tax free. They net an additional $5,461,181. The old $2 million policy was subject to a 45 percent estate tax. Since Bob owned it personally, the sons would have only netted $1.1 million.

Conclusion

It pays to audit. Several cases have settled out of court that have been brought by beneficiaries of an irrevocable life insurance trust, based upon the trustee’s failure to audit
or investigate offers from other carriers which would have provided them with greater death benefits. Costs cannot be overlooked. Little imagination is needed to foresee how irrevocable life insurance trust beneficiaries will be liable to beneficiaries for the difference between death benefits received from universal and whole life policies.

 

http://www.lifehealthpro.com/2015/07/23/women-in-insurance-and-the-champions-of-change?t=company-news&page=2&page_all=1

JUL 23, 2015 | BY EMILY HOLBROOK

Insurance was — and still is — a man’s profession. The male dominated careers within the industry have often been uninviting and unattractive to female business professionals looking for promising and rewarding futures. Times have changed and so has the insurance industry.

In fact, according to the Insurance Industry Charitable Foundation (IICF), 75 percent of women in the insurance industry believe that progress is being made toward the goal of achieving gender equality in the industry, while two-thirds say they have seen work being done within their own organizations.

So which individuals, organization and resources are the real champions of the cause?

The professionals

Gail Linn started her career in the airline industry. When a merger presented her with a generous leave package, she accepted and decided on a whim to interview with MetLife. She started with the insurance giant in 1989; the only woman in an office of 20 men. Today, 17 percent of the advisors at her MetLife Premier Client Group of New York City are female.

Linn is not surprised at the growth, considering the benefits the career has for both men and women alike. “There is no glass ceiling and you have total flexibility to build a market that you can be passionate about and fits your lifestyle,” says Linn, who is featured in a soon-to-be-published book titled “Financial Services: Women at the Top” by Diane Dixon & Arthea Reed.

And what advice would she give women fresh out of college and wondering if insurance is the right career for them? Connect, contact and comprehend.

“She should reach out and speak with as many women in financial services as possible,” says Linn, adding that connecting with local chapters of NAIFA — many of which have special events for those under 40 — will prove beneficial. Also helpful is reading as many insurance and financial services trade journals as possible, Linn stressed, especially those that promote women or young advisors.

“Consumers today are looking for trusted relationships with financial advisors they can seek out to help them make smart choices about their money and women are extremely suited to building those relationships,” she adds.

Like Linn, Eileen McDonnell didn’t have aspirations of an insurance career. When she graduated from Molloy College on Long Island, she started working for WANG Labs. While at WANG, she began earning her MBA in Finance from Adelphi University, which set the stage for a change in her career. Equitable (now AXA) was a large client of WANG, and McDonnell received an introduction into Equitable and was hired as a financial manager. Now, McDonnell serves as the chairman, president and CEO of Penn Mutual, an insurance organization working towards gender equality.

“We have a company with over 40 percent of our board and senior leadership who are women,” says McDonnell. “We ‘walk the talk.’ Other companies are trying to aspire to what we have already achieved. Our attention is now focused on increasing the number of female advisors.”  

McDonnell practices what she preaches by taking the time and opportunity to speak with young women about a career in insurance. “I tell them today what I have told them over the years: If you want to live a life of significance and make a positive impact on people's lives, this is the career for you,” she says. “You will work hard, but it will never feel like hard work.”

Dana Hollinger, founder of Beverly Hills-based life insurance and estate planning firm Dana Hollinger Group, has a more matter-of-fact view of the current state of diversity within the industry. “The real question is not whether women are entering the industry, it’s whether or not they are staying in the industry and in what capacity,” she says. “I have always seen women in administrative roles at the carriers. How many are getting into the E-suite?”

Hollinger’s questions bring to light a serious issue within the industry: women and leadership roles. Groundbreaking 2013 research by Mike Angelina, executive director, Academy of Risk Management and Insurance, Saint Joseph’s University, showed that only 12.6 percent of women in the insurance industry hold board of director positions, 8 percent are named inside officers and only 6 percent hold C-suite positions.

Hollinger strives to help women with her practice, believing that when you inform and educate women you elevate women, and, in turn, society. But she’s not as optimistic when it comes to women working in the industry. When asked if Hollinger sees the insurance industry as a great career option for women, she says “not at the moment, but hopefully soon.”

The companies

It’s not all gloom and doom for women in insurance, however. Some companies within the industry are taking aggressive steps to ensure employees represent gender diversity. And the year-over-year results are tangible.

According to the IICF, the percentage of women who cited “biases in advancement” and “lack of opportunities for professional advancement” as the chief barriers to advancement for women in insurance fell from 76 percent in 2014 to 68 percent in 2015. Are companies finally beginning to value diverse leadership? A few certainly are.

Lincoln Financial Network is one. Women make up 14 percent of the advisor population at the company, while The WISE Group (Women Inspiring, Supporting, Educating), an enterprise-wide effort driven by LFN’s female advisors, aims to attract even more.

“Today, less than 10 percent of client-facing advisors in the U.S. are women,” says Nicole Spinelli, director, The WISE Group. “We believe that diversifying our advisor population will benefit our existing advisors and clients. We strive to bethe broker-dealer for women advisors.”

Spinelli says LFN has much to benefit from adding more women to the force, since they are innate relationship builders, “which make them excellent advisors,” she says. “Growing our network of women advisors — and empowering our female clients — will have an extremely positive effect for our clients and our overall business.”

Executives at Guardian Life agree. They see the need for diversity as twofold: the benefit of diverse teams from a financial and productivity standpoint, and remaining relevant to consumers, many of whom represent diverse backgrounds.

And now, the company is in the midst of a multifaceted initiative aimed at increasing the number of women financial professionals. Guardian is working to develop female leadership within the salesforce, creating community among female employees, providing mentors and working to ensure the company creates an inclusive culture that allows all employees to thrive.

A recent article in Forbes by Sasha Galbraith reported that women control just over half of the wealth in the United States and that number is expected to grow to two-thirds by 2020. Couple that with the need in the market for more financial professionals overall and it would seem that a career in insurance and financial services would be an obvious choice for women. Unfortunately, that’s not the case.

“Having grown up in this industry, I’m passionate about figuring this out once and for all and making sure more women have access to a financial advisor and consider this career as an option,” says Emily Viner, vice president, agency growth and development at Guardian Life Insurance Company of America. “We can recruit women all day, but if they don’t survive and thrive, it’s a waste. That’s why the work to recruit, grow and retain women in this industry takes consistent, dedicated resources.”

Guardian has experienced success when it comes to the company’s female sales leaders. After learning that many women had not considered a move to management because they had never been asked, Guardian started asking. Since 2012, the company has seen a 71 percent increase in the number of female managing directors and the composition of Guardian Leadership Institute graduates — the company’s talent bench for its salesforce — is now at 26 percent women. Furthermore, in both 2013 and 2014, Guardian’s top new agents were women.

New York Life is yet another company that is putting efforts towards gender equality in the industry. The insurance giant “recognizes that there is real value that the field force of agents reflects the community in which we serve,” said Kimberly Fisher, corporate vice president and head of the women's market, New York Life. “Thirty-five percent of our new recruits in 2014 were women and we are on track to beat that percentage in 2015.”

The company is investing in supporting women agents in the field by hosting workshops, creating marketing materials and sales pieces designed to help them succeed, along with monthly webinars discussing best practices for success within the industry. Apparently, New York Life’s efforts are working.

In 2014, of the 1,179 female MDRT members in the United States, 32 percent were New York Life agents, making the company the leader in female MDRT membership. In fact, New York Life has more than four times as many women members than the second-place company.

The resources

While women continue to make strides within the insurance industry, there is always room for improvement and support from outside of their employer. The Women in Insurance and Financial Services (WIFS) organization is one such resource.

What first began in 1936 as the Women Leaders Round Table has grown into a 1,100-member organization for women looking to gain knowledge and success in their field. The organization even has male constituents looking to better understand the opposite sex, especially when it comes to management, recruiting and prospecting.

“We have quite a number of male members and it's a segment of membership that's rising,” said Deb Duff, WIFS executive director. “Most are managers who are interested in attracting women to the business or already leading teams of women.”

Among a host of other benefits, WIFS offers its members education (in the form of live webinars), mentoring programs, a national conference, networking opportunities, local chapter membership, online resources, and seemingly unlimited peer support and recognition.

On the other side of the industry, Brokers International, an independent insurance marketing organization, has developed a female-focused organization. WOMAN (Women’s Mentoring Agent Network) was designed for women who can benefit from a network of like-minded professionals that can constantly share new ideas, resources and ways to differentiate themselves in the industry.

Members of WOMAN participate in networking forums with top-producing women in the insurance and financial services industry, are awarded for accomplishments, engage in roundtable discussions and breakout sessions designed to address the success and challenges each member encounters and attends monthly webinars related to industry trends, event ideas and marketing strategies, to name a few.

There’s also the FWA (Financial Women’s Association), which brings together high achieving professionals from every sector of the financial world, including insurance. Established in 1956 when eight enterprising women on Wall Street met to share professional experiences and learn from one another, the organization has grown to a respected association with 945 members and countless events.

With so many resources, company efforts and like-minded role models working towards the same goal, it may seem that gender equality within the insurance industry isn’t so far off. There is a long road ahead, however. But at least there are many cracks in the ceiling.

Do Women Need Guaranteed Retirement Income Products?

Professor Brigitte Madrian addressed the differences and particular challenges of women planning for retirement in Forbes.com.

Lower lifetime earnings and longer life expectancies put women at a disadvantage when it comes to a secure retirement. One solution: helping them turn workplace retirement account balances into guaranteed income streams for life. Or in retirement-speak: annuitizing defined contribution plans.

The problem as Madrian posed it is that 401(k) plans are generally not annuitized and it’s up to workers to figure out how to try to make the money last for a lifetime. By comparison, old-fashioned defined benefit pension plans, which fewer workers have today, guarantee workers lifetime payouts, and the default payout is a joint and survivor annuity. That meant that a surviving spouse—usually a woman—would continue to get lifetime payouts over her lifetime.

Read the full article: Do Women Need Guaranteed Retirement Income Products?

Dana Hollinger Appointed to the Calpers Board

FOR IMMEDIATE RELEASE:

Contact: Governor's Press Office

Thursday, May 29, 2014

(916) 445-4571

Governor Brown Announces Appointments

SACRAMENTO – Governor Edmund G. Brown Jr. today announced the following appointments.

Awet Kidane, 38, of Elk Grove, has been appointed director of the California Department of Consumer Affairs effective July 3, 2014, following the retirement of director Denise Brown. Kidane has served as chief deputy director at the California Department of Consumer Affairs since 2012. He was chief of staff for California State Assemblymember Steven Bradford from 2009 to 2012 and senior advisor to California State Assembly Speaker Karen Bass from 2008 to 2009. Kidane served as a legislative consultant for the California State Assembly from 2003 to 2009, where he was an associate consultant from 2002 to 2003. This position requires Senate confirmation and the compensation is $148,836. Kidane is a Democrat.

Tracy Rhine, 42, of El Dorado, has been appointed chief deputy director at the California Department of Consumer Affairs, where she has served as deputy director of legislative and policy review since 2012. Rhine served in multiple positions at the California Board of Behavioral Sciences from 2008 to 2012, including assistant executive officer and legislative analyst. She was a consultant for the California State Assembly Committee on Business, Professions and Consumer Protection from 2005 to 2008 and consultant for the California State Assembly Speaker’s Office of Member Services from 2002 to 2005. Rhine was a graduate research assistant in Governor Gray Davis' Office of Innovation in 2002. This position does not require Senate confirmation and the compensation is $132,528. Rhine is a Democrat.

 Russell Attebery, 62, of Happy Camp, has been appointed to the California Native American Heritage Commission. Attebery has been council chairman of the Karuk Tribe of California since 2012. He was a teacher and athletic director at Happy Camp High School from 2009 to 2012, substitute teacher for Shasta County Schools from 2003 to 2008 and quality control supervisor and sawyer at Sierra Pacific Industries from 1982 to 2003. Attebery is a member of the American Professional Baseball Association. This position requires Senate confirmation and there is no compensation. Attebery is registered without party preference.

Dana Hollinger, 54, of Beverly Hills, has been appointed to the California Public Employees’ Retirement System Board of Administration. Hollinger has been principal at the Dana Hollinger Group since 2011. She was a life insurance agent at AXA Equitable Life from 2007 to 2011, a producer at Succession Capital from 2005 to 2007, a life insurance agent at Nationwide Provident from 1998 to 2005 and vice president at KB Co. from 1992 to 1998. Hollinger earned a Juris Doctor degree from Southwestern Law School. This position does not require Senate confirmation and the compensation is $100 per diem. Hollinger is registered without party preference.

Governor Edmund G. Brown Jr.
State Capitol Building
Sacramento, CA 95814 

Dana's Lessons from Life.....real stories, real women

 Blended Families and Remarriage.

Debra and Michael

Debra was 48 when she married Michael a doctor age 55. It was a second marriage for both.   Debra sold her condo in Van Nuys and moved into Michael’s home in Brentwood when they got married. Michael had a daughter from a prior marriage who he left his home to in his will.

The home was Michael’s separate property.   Debra always worried that if Michael died, she would not have a home.  Even if Michael changed his will and left his home to Debra she was worried since she did not have the income to maintain the mortgage payments to keep it.  Either way, Debra would be forced to leave their home if Michael passed away.  This created terrible friction in their relationship because Debra never felt secure or cared for.   Michael and Debra were married 15 years before he tragically died of cancer.  Over time, Michael changed his will and left his home to Debra. 

The Outcome

Debra was able to take off work the last year of Michael’s life to care for him.   Debra shared with me that without the insurance proceeds she did not know what she would have done. She has no income now, it was bad enough losing Michael, losing her home and the dogs as well would have put her over the edge.   Debra can sleep at night knowing she is secure in her home.  Face amount $300K annual premium outlay

Mary and Tom

Mary was 70 and living in Texas when she met Tom who was 78.  She met Tom while visiting her daughter’s family in Hawaii.  Both were widowed.  Tom and his first wife had retired and lived in Hawaii for over 20 years.  They never had children.   When Tom and his first wife made out their wills they gave one another a life estate in their half of the community property.  Upon both their deaths they disposed of their separate property to their respective families and charities.

Never thinking he would find love a second time, Tom asked Mary to marry him and come live with him in his home in Hawaii.  Mary said yes.  Tom in reviewing his estate plan realized that if he died first, he needed to have the resources for Mary to purchase half of the home from his first wife’s heirs.  They bought a life insurance to provide Mary the means to do that upon Tom’s death. 

The Outcome

Tom died 5 years later of a massive heart attack.  Mary is living securely in her home and mourning Tom’s passing.  $36,000/year he died 5 years later face amount $720,000 income tax free. 

Charlene and Rick

Charlene and Rick met in their 50s.  Both were widowed with adult children and grandchildren of their own. Charlene was a court reporter and Rick was a very savvy investor that bought and sold companies.  Charlene had a charmed life with Rick, they were  well off.  Rick was worth over $30m dollars.   Rick loved Charlene. They went to their lawyer to draft their estate plans.    Their lawyer recommended life insurance to cover their estate tax liability north of $10M upon both of their deaths.    Rick and Charlene never cared about their estate tax liability.  Charlene  wanted the life insurance policy on her life alone for the benefit of her children.  Charlene needed to feel secure that if she died before Rick her kids were guaranteed to receive an inheritance.

Charlene was convinced if she predeceased Rick, he would remarry. Her children would be left with nothing.

Outcome:

There is a $10M dollar trust owned policy   for the benefit of Charlene’s children.

Family Protection

My Story as a Single Mom

I was married for 14 years, my son Raleigh was 9 years old when his father and I separated.  For many year’s I was the sole support of my husband and my son.  In the divorce I have the full financial burden for my son because my ex-husband did not work for many years and claimed no income.  I have always maintained a life insurance policy on my life initially for the benefit of my family and now for the benefit of my son.   Raleigh depends on me, I know if I die Raleigh  has the means to complete his college education.  $6,000yr/ $1,000,000 face.

Veronica and Tim

Veronica was 38 and Tim was 40, they lived in Malibu and had two young children under the age of 10.  Their CPA had suggested that Tim’s policy be reviewed since it was 10 years old.  Mortality costs had gone down significantly and by exchanging to a new policy with no additional premium outlay they went from a $60K face amount to a $250K face amount.  Veronica was reluctant and did not see the need. Tim and their CPA said it was a no brainer and made complete financial sense

Outcome:

Tim was my first death claim.  He was also my youngest client to die.  He died while traveling with his family abroad of a undiagnosed brain aneurism.  I was Veronica's first call when Tim unexpectedly passed away.  Veronica is now the sole support of her family and did not know what she would have done without the additional money.

Auditing Policies

Do you have current life insurance policies?  When was the last time you had your policies audited? Policy should be reviewed every few years. Term and no lapse guarantees should be reviewed every 2 years.

Insurance is no longer a Buy and Hold investment, it’s a Buy and manage investment.- Are you maximizing the return of capital that you have already committed to the contract?

Rick and Dawn

Rick and Dawn had a $1.5M dollar trust owned policy for the benefit of their children that they had taken out in 1990, they were paying $35K in annual premiums which were scheduled to increase within the next year to $45K.  The Trustee of their policy asked me to audit their coverage.

Based upon the capital they had already committed to their contract we were able vies a vie a 1035 tax free exchange of their cash value into a new fully guaranteed life insurance contract with a guaranteed death benefit of $1.9M with no additional premium outlay.

The outcome was a $400,000 increase in face amount with no additional outlay just by auditing their policy.