Paul Garofoli, regional vice president at the Standard, discusses annuities, and estate planning and using letters of love, which every agent and advisor should incorporate into their practice.
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Interview Transcript
Paul Feldman:
Hello, everyone. It's Paul Feldman from InsuranceNewsNet. I'm here with my longtime friend in the industry, Paul Garofoli. We're at the NAFA Annuity Leader Forum, and we're here to talk about a few different things.
And one of them, Paul and I have been friends for a long time, and we talk the industry talk. And he has this whole philosophy on estate planning. A lot of people think it's just wills, trust, policies, products, and whatnot, but it's so much more than that. Tell us a little bit about that.
Paul Garofoli:
So one of the things I'm passionate about and probably becomes a part of my encounters with mortality, I've had a storied heart history of multiple heart attacks, and so these things are near and dear to me, and that is, when we talk about estate planning, we think of products, and like you said, trusts and estate plans and all those kind of documents and things like that. But what I like to talk about and actually do a presentation on this is letter from heaven, kind of managing the emotional elements of death and dying, really. And at the ripe age of 63, I just lost a dear classmate from ALS recently. And these things come to mind immediately, and that is that gap, that emotional gap, that families experience when a loved one is gone. And we don't think about those things.
And my story goes back to when I was 31 and bought life insurance for the first time, serious life insurance for the first time. And my agent at the time, and I remember him, this was a long time ago, 32 years ago, Howard Wits out of Columbia, South Carolina, he said, "Paul, I want you to write a letter from heaven." I go, "What's that?" He goes, "Well, that's kind of a phone call from heaven, that if God calls you home," as they say in the South, or from the North, as we say, when you get hit by a bus or run over by the subway, but if that happens, what would you say to your loved ones after the fact? What would you want them to know? What would you want them to feel? And I thought, man, this is kind of crazy. But you know what? I was game for it. So I actually wrote letters to my wife, to my newborn son that we had.
And when it resonated with me, wasn't that long after, because at 31, I bought insurance, super preferred. 41, I had a massive heart attack. And those elements of my own mortality started to really resonate with me in those things. And I tell a story about a few years beyond that when I was waiting for an ambulance and wondering if the ambulance would get there. And I had a high degree of comfort for two reasons. One, somebody had sold me life insurance, so that element of worrying about how my family and how my children would be taken care of, that was pretty well settled, so I had that. But the other thing that I had, Paul, that really gave me comfort in that time was that I'd actually written out letters about my feelings, about some life advice that I could provide my sons if I was gone and I wasn't around to give that advice.
So I've done that consistently over the course of my lifetime. Fortunately, I keep living, so it works out pretty well.
Feldman:
And your family keeps growing. You've got a big family.
Garofoli:
Big family by adoption and by fostering. I've been blessed with lots of kids and lots of love in the Garofoli household. But I've always taken that step. And now for grandchildren, I'm into the second generation now, writing these little notes about that, because you read about things when people pass and these things come top of mind. You might recall that people keep people's cellphones going for the voicemail messages. They'll call their dad, their mom, their wife, their husband, a loved one, just to hear that voice because there's that gap there that nobody completed that.
I'll finish the story. I played what I thought was a pretty funny joke on my wife. She wasn't that appreciative at the time. But two years ago, in 2021, I was greeted with the news that I needed a quintuple bypass. Now, it wasn't a complete surprise because we talked about my storied cardiac history, and I like to say, relative to that, they say God looks after fools and little children. Well, guess which category I've fallen in. So I've managed to dodge the cardiac event in a big way, but it came to a point where I needed a quintuple bypass. So knew that. Going in on Monday, and even though with the advances in medicine, it's not a sure thing at 61 going in. Needed that full, the full megillah, the full cabbage, as they call it.
So on Sunday, I wrote an email to my wife, anticipating the surgery on Monday, and I delayed it till Tuesday, because you can delay an email. This is pretty amazing. So on Tuesday, my wife gets, after my surgery, she gets an email from me that says "just in case". "Just in case". You know what it was? It was my obituary. I'd written my obituary in advance, just in case.
Feldman:
Wow.
Garofoli:
And the reason I did that is this emotional element, this gap that we have when people that we love pass on and they don't tell us those things. They don't tell us the things that they were thinking of top of mind, mostly because I didn't want a crappy obituary. I wanted one in my own voice, Paul. And I know if my wife was in charge, all beloved husband, beloved father, loved by all. It's like, ah, like that. So I had fun with my obituary because-
Feldman:
Just in case.
Garofoli:
... just in case, and I have a little bit of a sense of humor. But it goes to the larger issue, which is, for the financial professionals watching this, if people even outside of the industry watching this, that there's another element behind all those things that you need to do. Do you have the right insurance products? Have you titled those products properly? Do you know who your current beneficiaries are? All practical steps. Do you have a will? Have you established a trust, if that makes sense for your particular planning situation? But have you taken care of those other elements? Simple things like, does your spouse know your LinkedIn password? You may have had this experience. You've been in the business. I get anniversary notices for people that have been dead for five to ten years. Now, did you know on LinkedIn you can actually notify them that somebody has passed on?
Feldman:
I didn't know that.
Garofoli:
You can do that.
Feldman:
Wow.
Garofoli:
If you say, "Hey, by the way, this person's passed on," and they ask you-
Feldman:
Yeah, because those Facebook ones sometimes last forever.
Garofoli:
Right. It's a little startling. You know, you see that, but you can notify the social media providers that somebody's passed on. They usually ask for some documentation. You can draw an obituary, and then it's handled. But those little things on your social media. I mean, I guess we will live on in perpetuity.
Feldman:
Well, and your bank account, all your logins. We have so many logins today, and every one of them seems to be different.
Garofoli:
Absolutely, and one of the blessings of having some challenging health history is that periodically I sit down with my wife and, "Okay, hey, here's all my passwords." Now, if you have secret accounts, you're going to have to figure something else out. But for us, it's like, okay, here it is on these things that are unique to me. Could you just make sure that you either close them out or retitle them or do those kind of things?
So the social media accounts, all these little things that a lot of times a financial advisor might not consider. They're looking at the numbers, and do you have enough to provide for your loved ones, and here's the products and services that can help with that. But how about those other things like that, like the letter from heaven, like sharing your passwords and things like that? Putting them in a place where we can do that. My wife-
Feldman:
Well, it also makes your sell not just about a product. It's like you really care about the person-
Garofoli:
Right, right.
Feldman:
... and you're really giving them some value, something that is important that could make their next-of-kin life's a heck of a lot easier, because it does stink when you lose somebody.
Garofoli:
Yeah, exactly. So my counsel would be to the financial professionals watching this is think about that additional emotional element, that practical element of a loved one passing. Have they taken those steps? In some cases, there are forms that are called letters of last instruction that addresses some of these things step by step. You can find those online pretty easily, but I'm a big proponent of that letter from heaven. I love to write personal notes. I love to write them [inaudible 00:09:06].
Feldman:
Well, I think that every financial advisor should take heed of this man. He sends me personal notes all the time. He actually sent... You sent a personal note and a gift to one of my employees, and she freaked out.
Garofoli:
Yes.
Feldman:
She's like, how does he know where I live?
Garofoli:
Yes, but, you know-
Feldman:
On the web, you can find anything.
Garofoli:
So, I mean, I love to do that, and that's another element of my part of financial services practice, being a company wholesaler, is providing that extra high touch. We talk about high tech and high touch, and so this is another element of it. But do you have those practical things and emotional things that you want to say, that telephone call from heaven, that you'd love to be able to say that you just didn't get a chance to say? Because we're of a certain age where people that we know and love pass on, and sometimes suddenly. You know, you don't have the luxury of that like I did, kind of knowing I'm going to have this major surgery in advance so I could make some plans. And so I've always had that in play, and I'd advise the folks watching this, think about that as well, having that element of that part of the estate plan. I think it's equally important to products and services and all those things, to have that extra step, that you have that ability to communicate your feelings to the people you love.
Feldman:
Well, and the other thing, too, is you remember that insurance agent's name.
Garofoli:
I see.
Feldman:
And will your client recognize your name 20, 30 years from now?
Garofoli:
Yes, and so that's the thing that I think is important, is to provide that added value. We talk about that, because let's face it. Everybody has access to products. There's no lack of products out there. There's no lack of services. You might have a certain degree of expertise and knowledge, but that can be acquired as well. Are you doing something uniquely to distinguish yourself as someone that not only provides products, services, and advice, but someone that cares?
And as a person, Paul, that has had those moments where it's like, man, I'm going to close my eyes, and if I'm still alive when I open them up, that's a good thing, I've had those moments dealing with some of my heart issues over the years and having that degree of comfort that not only did I have the products and services in place, a big part of it, but I had this other part of it, no one's going to be wondering how I felt about them after I'm gone, because I told them. I wrote it down. And so I feel pretty good about that.
Feldman:
Well, speaking of death-
Garofoli:
Yes.
Feldman:
... one of your other passions are these new death benefit riders on annuities. I mean, we are at the annuity conference here. We’ve got to cover that.
Garofoli:
Right. You know, it's funny. I tell my friends and family, it's kind of come in handy, I'm really good when people die. I'm really good at that process in terms of establishing benefits, how many death certificates do you need. You actually need more than the funeral director will tell you, because there's all kinds of times when that's needed.
But relative to products, I'm pleased to say that at my company, The Standard, we're adding a death benefit rider to our flagship fixed index annuity, the enhanced choice index annuity that's really starting to take hold. It's almost like we've had a soft launch of the product, and now it's become fully formed about a year into its debut, adding a really strong death benefit rider onto an annuity.
Now, I kind of like it, because, as you know, in past lives and with the past carrier, I was wholesaling life insurance. At The Standard, I'm just doing annuity-centric. We don't have life products in the traditional sense at The Standard. So I'm all annuity all the time. So this is kind of a bridge from my life insurance days to have this additional benefit onto a fixed-indexed annuity that I think actually makes a lot of sense and is high-value and high-impact.
Feldman:
And so you're seeing this from a lot of carriers now?
Garofoli:
Yes.
Feldman:
And you think this is a growing trend?
Garofoli:
I think it is. You know, Paul, we talked about this in the warm-up to the video here that we're doing, is that the fixed-index annuity business, of which I'm a part, which your magazine and website covers, has borrowed from the variable annuity world. What did we borrow first? Well, we borrowed income riders and annuitization types of riders, but mostly the income rider was one of those things. Made a lot of sense, providing a guaranteed value that provides an income you can't outlive. Makes all the sense in the world, and the value being that even though the underlying fixed-index annuity isn't going to lose value in and of itself, there's no guarantee of growth so you really can't project accurately what that will generate in income because the gains can be anywhere from 0% to 15% depending upon how the indexing works. So we borrowed then the fixed-indexed annuity income rider, and that makes a lot of sense.
What we've done at The Standard is, and what a number of other carriers have done... about 12 or 13, so it's not predominant yet in the marketplace because it does require that you have some financial strength and some abilities to deliver on that promise later on down the line... is a death benefit rider that we think is super-competitive and addresses an additional need that I think ultimately most people will need. When I talk about annuities, Paul, the reality is that most people will die with their annuity fully or partially intact. I've yet to find that client that either annuitizes, incometizes, takes withdrawals, whatever it is, and on that day they get their last check, God calls them home.
Feldman:
Yes.
Garofoli:
There's always some overlap. Yes, maybe they're getting income, but there's still something left over. Maybe they haven't even started income. That's the thing about a lot of annuities, is that at some point in time, what became an income asset, an asset of some sort, became a legacy asset. What became a live-on asset, like an annuity, becomes a legacy asset, and not everybody knows when to make that pivot. They don't know when that pivot's going to happen. Moreover, it may happen when they don't have the ability to qualify or purchase life insurance in any meaningful way. So we think that having that death benefit rider option on a very competitive fixed-index annuity really can service our clients more broadly and actually maybe bring a few more clients under The Standard annuity tent.
Feldman:
I think it will.
Garofoli:
Yes, so it's real strong.
Feldman:
Well, Paul, this has been an awesome interview. We just covered a lot, and I love your letters from heaven. And I think everybody should be doing this, everybody. Thank you so much.
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