Grey Flannel Insurance Planning

5. Then there is the delivery of the policy, when the plan is implemented. It is important that the insurance advisor and family advisors verify the ownership and insured information, along with underwriting classes and product types, beneficiary designations and premium amounts (if any).

6. After that, there should be periodic reviews—evaluations of in-force policy performance conducted at selected intervals. The insurance advisor should continue to work with the family’s advisors to compile a detailed list of all policies—keeping up to date on death benefits, cumulative premiums, cash values and any outstanding policy loans—and assist in analyzing policy performance. Actual policy performance should be benchmarked against the original design, as well as the marketplace. Discrepancies should be researched and explained, and then corrective steps taken if necessary.

7. After that, the insurance advisor must provide ongoing service and administration, collaborating with the family’s advisors. The insurance advisor should be able to understand and report on fiscal year-end values, reportable income related to split-dollar arrangements and information required under the Internal Revenue Code, Section 101(j). The life insurance advisor should continue to work closely with the family’s advisors when coordinating planned annual funding, any potentially taxable gifts, trust beneficiary withdrawal rights and cash-flow planning. In-force pricing improvements, if any, should be tracked and communicated as well.

Finally, a life insurance claim is the culmination of the entire approach. The insurance advisor should proactively oversee the claims process to ensure there is a timely and accurate payment of policy benefits. This is often a difficult process for many families, and the life insurance advisor should endeavor to make it as seamless as possible.

Conclusion
By taking a more disciplined, process-oriented approach, families have a tremendous opportunity to improve results and drive greater efficiency and effectiveness into the management of their life insurance portfolios. When families follow these guidelines and select an insurance advisor who adheres to these principles, they can have a closer, more institutional relationship, something far different from the retail, transactional model that permeates the life insurance industry today. 

Peter Fleming is vice president of business development at Atlanta-based insurance advisor Nease, Lagana, Eden & Culley, where he works closely with
single-family and multifamily offices.