NAIFA Blog

NAIFA President Rob Smith Personalizes Importance of Life Insurance in Meeting With Congressional Working Group

NAIFA President Rob Smith

The life insurance industry was a force majeure yesterday. NAIFA President Rob Smith, along with NAIFA member and AALU Vice President Anthony Domino, added color to the Secure Family presentation to the Ways & Means Financial Services Working Group on April 25.

Congressmen Adrian Smith (R-NE), John Larson (D-CT), Richie Neal (D-MA) and Aaron Schock (R-IL) and members of their staffs were in attendance. The presentation covered the mechanics of  life insurance products, the significant public policy benefits and economic impact of the industry, as well as the appropriateness of current taxation.

Smith shared how life insurance preserved a family farm, which has a number of employees and families dependent on it, after a snowmobile accident killed one of the owners. This personal story really resonated with those in the room, clarifying that the issue goes beyond numbers and is really about the financial well-being of families.

The Secure Family coalition previously met with the Ways & Mean Pension and Retirement Working Group on March 14 and submitted formal comments on April 15.

Survey: Women's Interest in Financial Planning Has Grown

Women make more financial planning and savings decisions than ever before, with some 90 percent of women aged 25-75 in a recent Allianz survey saying they need to be more involved in financial matters than in the past.

Nearly two-thirds of the women surveyed said they want to learn more about investing, financial planning and retirement planning, up from about one-third in the original Allianz survey in 2006.

In spite of this, women are not necessarily looking to financial professionals for help. Only 38 percent of the women surveyed said they have used a financial professional.

“The Allianz survey shows that women are an under-served market,” said Rob Smith, president of the National Association of Insurance and Financial Advisors. “The products and services NAIFA members provide help guarantee the financial security of 75 million American families, and now more than ever women are making long-term financial decisions on behalf of their families. It is crucial for insurance and financial advisors to develop messages and communication styles that appeal to women.”

The Allianz survey shows that women who do work with financial professionals find value in the guidance they receive. Seventy-seven percent of this group said they feel confident and prepared financially for the future, while 75 percent have recommended a financial professional to other women.

The women surveyed by Allianz were more interested in saving for retirement or ensuring a guaranteed income for life than in receiving stock market advice.

“NAIFA members pride themselves on providing high-quality services and products to the middle-market,” Smith continued. “We help people reach long-term financial goals, such as ensuring their comfortable retirements or the financial well-being of their families. It’s really not surprising that as women are more involved in financial and retirement planning these are the goals they find most important.”

With White House Budget on Tap, NAIFA's Timing Is "Perfect"

NAIFA President Rob Smith Addresses Attendees at NAIFA's Congressional Conference

As NAIFA members take their message about the importance of life insurance and its current treatment under the tax code to Capitol Hill today, the White House has announced that it will propose its FY2014 budget tomorrow.

Press Secretary Jay Carney said that tax reform designed to net the government approximately $580 billion will be part of the President’s plan.

NAIFA members today are telling members of Congress that lawmakers and the administration face a daunting challenge to get the federal deficit under control, but life insurance, annuities and retirement savings are part of the solution.

Life insurance products provide financial security for 75 million American families and account for 20 percent of long-term savings in the country. They provide a financial security blanket for many people who might otherwise look to the government for help.

“NAIFA’s Congressional Conference has come at the perfect time,” said NAIFA President Rob Smith. “Congress will be hearing a lot about the President’s budget proposal in coming days, but we’ve been fortunate enough to meet with 80 percent of congressional offices today to give them some context for the coming tax reform debate. Thanks to our dedicated members, members of Congress know exactly how important life insurance is to their constituents and the economy.”

Why I Am in Washington, D.C.

About 1,000 NAIFA members are taking advantage of the opportunity to be part of an important history-making event: NAIFA’s Congressional Conference. The meeting, currently under way in Washington, D.C., was organized by NAIFA to give members a platform to educate their lawmakers about the important role insurance plays in the lives of millions of Americans, and why it is imperative that tax reform does not make it more expensive or more difficult for Americans to purchase this valuable product.

As the members prepared for the meetings with lawmakers, several of them shared some of the reasons why they left their busy practices and traveled to Washington, D.C., to make their views known. Here are some of these reasons, in their own words:

"I am a Committeeman in North Dakota and I am active in local and state associations there. I believe that political advocacy is important and that we must keep the lines of communications open with our lawmakers in Washington, D.C.  We did something similar at the state level, and I believe that is time to support NAIFA on a national level."

— John Halstenson, North Dakota

 

"This meeting was an important opportunity for me to support NAIFA’s cause on a big stage. This is a critical time to be involved in political advocacy. It is very important for our voices to be heard by our lawmakers, loudly and clearly."

— Marty Glickman, Chicago

 

"We need to protect the tax benefits of the products and services our clients use, and I believe this is an excellent way for us to do so."

— Greg Smith, New York Life

 

"Political advocacy is one of the greatest benefits I get for being a NAIFA member. The other benefits, such as the professional development benefits, are also important, but political advocacy is key."

— Tmora Payne, Mississippi

 

"The program is admirable. We must support political advocacy to prevent possible taxation of the products and services we provide to our clients. It is important for us to act as a resource to our lawmakers and to educate them about the critical role we play in the lives of our clients. The government is looking or money wherever it can find it, and we want to make sure our products are protected. Our greatest benefit from NAIFA is political advocacy because ultimately, if we do not have the appropriate products and services, we will not be in business."

— Cindy Petersen, Colorado

NAIFA Trustee Matt Huntington: Advisors Have an Obligation to Protect Insurance and Financial Products Critical to Main Street Americans

The fifteenth in a series of video clips on the importance of advisors engaging Congress on tax reform.
NAIFA Trustee Matt Huntington. (48 seconds)

 

Registration for the NAIFA Congressional Conference is open.

 

"Protect Your Business: Grassroots Advocacy" video clips series:

1. NAIFA President Rob Smith
2. NAIFA President-Elect John Nichols
3. NAIFA Secretary Juli McNeely
4. NAIFA CEO Dr. Susan Waters
5. NAIFA Past-President Robert Miller
6. NAIFA Treasurer Matt Tassey
7. NAIFA Trustee Kevin Bell
8. NAIFA Trustee Michael Brown
9. NAIFA Trustee Bob Buxman
10. NAIFA Trustee Edward Deutschlander
11. NAIFA Trustee Paul Dougherty
12. NAIFA Trustee Brenda Doty
13. NAIFA Trustee Jerry Flowers
14. NAIFA Trustee John Holmes

NARAB II Legislation Introduced in the House and Senate

Legislation to create a national non-resident licensing program for life insurance agents and brokers, NARAB II, has been introduced in the House and the Senate. The bill has 14 bipartisan cosponsors in the Senate and 41 in the House.

NAIFA President Rob Smith issued the following statement on the NARAB II legislation:

NARAB II, legislation to enact the national agent/broker licensing entity for non-resident licensing on a multi-state level, has been introduced in both the House and the Senate with a Senate Hearing scheduled for next week.  NAIFA encourages and supports this common-sense approach to eliminate the duplicative and burdensome state-by-state non-resident licensing.  Producers, once licensed in their home state, can apply for membership to NARAB.  The new entity will be governed by a 13-member panel of state regulators and insurance industry representatives.  This will be a win for insurance consumers and for agents both, reducing unnecessary costs and establishing standards that exceed existing requirements. 

NAIFA Trustee John Holmes: If Life Insurance Is Taxed, Could Your Clients Continue to Protect the Ones They Love?

The fourteenth in a series of video clips on the importance of advisors engaging Congress on tax reform.
NAIFA Trustee John Holmes. (32 seconds)

 

Registration for the NAIFA Congressional Conference is open.

 

"Protect Your Business: Grassroots Advocacy" video clips series:

1. NAIFA President Rob Smith
2. NAIFA President-Elect John Nichols
3. NAIFA Secretary Juli McNeely
4. NAIFA CEO Dr. Susan Waters
5. NAIFA Past-President Robert Miller
6. NAIFA Treasurer Matt Tassey
7. NAIFA Trustee Kevin Bell
8. NAIFA Trustee Michael Brown
9. NAIFA Trustee Bob Buxman
10. NAIFA Trustee Edward Deutschlander
11. NAIFA Trustee Paul Dougherty
12. NAIFA Trustee Brenda Doty
13. NAIFA Trustee Jerry Flowers

Complacency

By Rob Smith, NAIFA President

NAIFA President Rob Smith

A March 5 NAIFA Blog post noted the favorable coverage that NAIFA’s grassroots government affairs  program received in the March 1 issue of InsuranceNewsNet (INN). INN editor in chief Steven A. Morelli sought input from real NAIFA members and lobbyists to showcase the historical role that NAIFA’s members and staff have played in creating and preserving the life insurance and annuity tax benefits that help financially secure 75 million American families. 

A read of the full article also introduces a phenomenon that can easily blunt any government relations program—complacency. One highly regarded industry observer was quoted in the article as saying:  “I have taken the view that until the dotted line is signed, it is nothing. Until they actually sign it in to law, I would not get too excited.”

For those of you old enough to remember former Dallas Cowboy quarterback “Dandy” Don Meredith and the early years of Monday Night Football, waiting until the “dotted line is signed” would be the equivalent of singing Dandy Don’s then famous serenade when the outcome of a game was assured: “Turn out the lights, the party’s over.”

It’s easy to assume that the current tax laws for life insurance and annuities are carved in stone and that to suggest otherwise is crying wolf. But, facing ever more difficult budget choices, Congress has been cutting back. A recent example is the Affordable Care Act’s 3.8 percent tax on the investment income—including annuity payments—of “high income” people. High income people today, moderate income people tomorrow. Annuities today, life insurance tomorrow.

Knowing that bad things can happen to good tax provisions, NAIFA is always alert to that possibility. The budget/tax situation has been growing (mostly) dire for over 40 years. For NAIFA to ignore the threat to life insurance and annuity tax policy would amount to association malpractice.

So, kudos to the NAIFA members who will be attending the April 8-9 Congressional Conference. And congrats to the key legislative contacts who recently made fly-ins to D.C. and regularly walk in to the district offices. For other NAIFA members, stay alert to the possibility of a general grassroots call to arms. Remember, a good offense is the best defense—in football and government relations.

INN Cover Story Highlights NAIFA Members' Grassroots Role in the Tax-Reform Effort

InsuranceNewsNet's March cover story provides a call to action for insurance advisors to use their grassroots influence with Congress to preserve the tax status of life insurance and annuity products.

The article provides a rundown of NAIFA’s historical involvement in the protection of life insurance, beginning in 1913 with passage of the federal income tax code. It then explains the present threat as Congress considers tax-reform proposals in 2013.

The article raises the point that advisors have heard about warnings about efforts to tax their products several times through the decades.

Diane Boyle, NAIFA vice president of federal government relations, explains that the industry’s success at protecting life insurance in the past doesn’t mean the threat this time is not real.

“Frankly, our products are on the line every year and we’re successful at having them taken off the table,” she told INN. “So it’s not so much crying wolf as it is being prepared and making sure that folks on the Hill understand.”

From the article:

“Members of Congress are having to deal with so many issues that they rely on their constituents who have an understanding in a given area to explain what the realities are with some of the decisions that they’re having to make. And that’s what our agents do. And that’s the value of bringing them in and having them share the story.”
-NAIFA Vice President Diane Boyle

“What I find useful is sharing situations of how our products have helped people here within the community – people within [the member of Congress's] own district.”
-NAIFA Member Hyatt Erstad

“I talk to [members of Congress] about the savings rate in America today, and how poor it is, and then point out that over 20 percent of the savings in America today is represented by our products. To do anything to discourage people from taking responsibility and using our products, all that’s going to do is further deteriorate the savings rate of Americans today.”
-NAIFA Member Bob Roach

The INN article reports that life insurance organizations, including NAIFA, formed SecureFamily.org to educate Congress and the public on the issue.

It also reports on NAIFA's Congressional Congress April 8-9, a grassroots event in which 1,000 advisors will visit congressional offices to discuss life insurance, annuities and tax issues.

Read the full article on the INN web site.

Dr. Susan Waters: Insurance Groups Form a Potent Coalition to Benefit the Industry and Consumers

NAIFA CEO Dr. Susan Waters addressed 140 members of leading life insurance advocacy groups, NAIFA, ACLI, AALU, GAMA, IRI, and NAILBA in Washington for a SecureFamily.org Capitol Hill fly in. The attendees met with congressional members Thursday to discuss the importance of life insurance and maintaining the current tax treatment of insurance products.

An excerpt from Dr. Waters' remarks (2 min. 38 sec.):

 

The fly in was the second in a series of D.C. grassroots events in which NAIFA members are participating. Next, more than 1,000 NAIFA members will attend the NAIFA Congressional Conference and meet with their members of Congress, April 8-9.