Interview with Jason

Registered in FL, TX, and CA.

*** When do you recommend life insurance to business owners? (His client base is centered on business owners)

Before I build or maintain their portfolio I have an honest conversation about planning. We don't do anything until they have the plan laid out: estate, tax, and risk mitigation.

Say we have a plumber who is talented, has lots of clients, but doesn't have sophisticated business acumen. They may not understand the risk mitigation side of things.

You need insurance to protect against major loss. And you can take your savings and protect it in qualified channels.

*** How many insurance-licensed agents?

Both of us (the firm is small right now).

*** Do you outsource your insurance sales?

We work with a group out of NC ("Cason Group"). We put the idea down and they help structure it.

*** How do they design the product?

They design it based on out parameters and then hand it back.

If there was one request I could have, it would be for a more streamlined process. I want to sit down with my client and fill it all out. But insurance is still clunky, esp. when compared to the trading and custodial side.

*** Explanation of Amplify

I think you guys are right on point by using a fee-based model rather than commission-based. I want to be a true fiduciary -- which means fee-only -- but the insurance industry does not allow that. I have to explain to my clients that I cannot be fee-based when it comes to insurance, but that I would if I could.

*** We want to find fee-based managers -- wealth managers, RIA's, etc. who want that long-tail revenue stream rather than an immediate commission.

As RIA's we like that stable source of income rather than a lumpy style. Younger, hungrier people will want the up-front commission, but more seasoned RIAs know that AUM is better in the long run.

*** Can you tell me about the last few customers that you sold insurance to?

The most recent was a $1MM split-dollar plan to get a lot of dollars behind a tax screen. LIRP was involved.

The other was for a widow who had low financial knowledge. Her husband had taken care of the finances. We were able to guarantee some income for her.

Insurance comes up for every client who we work with. We use a financial planning tool called "Right Capital" which is similar to "eMoney" ("Black Diamond" is another product). We start with the software's recommendation, and then customize it for the client.

We tell clients to put the risk on the insurance company for any major events that could result in a liquidity problem for them.

*** Where does the insurance recommendation process start and end? What do you outsource?

Having done this for a while, I've got a sense of which carriers are going to be the best. After meeting with a client, we set up a call with Cason group in NC. From there, they put together a package for us, and take that to certain carriers to make sure we are competitive. We do not bring Cason group to a client call, we just outsource some of the work.

*** Do your clients go through underwriting with multiple carriers?

Sometimes multiple. One carrier may not have everything a client needs.

Company "Altruist" -- Problem was that the paperwork took three weeks to finish and then it would come back NIGO. But they streamlined it all and made it digital. They took all of these sticky pain points for custodial processes and started knocking them out one by one. I'd love to see that happen on the insurance side.

My approach is a "service model". I'm not trying to gather a volume of clients. I'm not trying to do exotic, complex investing. My angle is service. I want my value to be seamless service.

But if the client has to walk through a ton of platforms, they may wonder why they are even paying a financial advisor.

I want to limit the client's ability to change things. If they go in, and change a lot of numbers, that could undo hours of work. The down side of that is that they sometimes feel like they need to "ask permission" to use their own money.

*** What products are you recommending for your clients?

In general, it's VUL. Sometimes IUL, but that is less flexible.

*** What determines which one you recommend?

It depends on the client, the risk tolerance, and the product. Whole life was rarely an option because of the poor nature of the product.

Clients who are in retirement have very different risk tolerance compared to younger people.

*** How do you manage these VUL investments today?

With Jackson, there is a portal that we can use to manage the product.

*** What tools do you use?

Altruist, Jackson's portal, Wealthbox.

Altruist takes a ton of work off of my plate. For example, on any trade or transaction, I would have to take notes on what I did and relay those to the client. But the platform takes care of that.

We can now place trades in their 401(k) and even charge a fee for that.

If you could show the Amplify platform data within an existing one, that would be ideal. Clients do not like to log into a lot of different platforms.