John Hancock Celebrates 10-Year Anniversary of ‘JH Solutions’ With Two New Life Modules

- Cutting-Edge Concept Illustration Software Introduced in 1999 Now Has More Than 30 Modules To Assist Producers In Addressing Range Of Client Needs

- Two Modules Added: 'Wealth Transfer Planning Through the Use of the 6166 Election and Life Insurance' and 'One-Way Buy-Sell'

- Two Additional Modules To Be Introduced Shortly: 'The Power Of Permanent Insurance' and 'Needs Analysis'

BOSTON, April 9 /PRNewswire-FirstCall/ -- The Advanced Markets Group of John Hancock Life Insurance is celebrating the 10-year anniversary of its proprietary "JH Solutions" concept illustration software with the addition of two new modules: "Wealth Transfer Planning Through the Use of the 6166 Election and Life Insurance" and "One-Way Buy-Sell."

In addition, as part of its Key To Life campaign, a back-to-basics approach to selling life insurance, the group also shortly will be introducing two other modules "The Power Of Permanent Insurance" and "Needs Analysis."

Introduced by Manulife in 1999, prior to its acquisition of John Hancock in 2004, the concept planning software made its debut with its first module, "Making Lifetime Gifts." Today with more than 30 modules (see list below) available to producers, JH Solutions covers an extensive range of planning options from simple gifting strategies to sophisticated financing arrangements.

The program uses summaries, flowcharts, and graphs to help producers familiarize clients with planning options on a conceptual level. For clients looking to move forward with a particular solution, the software then enables producers to present the sophisticated data and calculations in an easy-to-understand format illustrating client's specific situation.

"At John Hancock, we are committed to providing state of the art tools, products and services to help producers support their clients and build their businesses," said Randy Zipse, vice president, John Hancock Advanced Markets Unit. "We have continually updated and strengthened JH Solutions over the past 10 years and believe it is cutting edge for the industry. With it, we can address client and producer concerns, offer options and find the money to close even the most complex cases."

Life Insurance and the 6166 Election

For the owner of a closely held business, liquidity for the estate can be a matter of particular importance. If that business represents a large portion of the estate, the business owner may be concerned about heirs being forced to sell the business or its assets to pay estate taxes. Planning for the cash needed to help heirs fund estate taxes and other obligations is essential.

Under current tax law, at the time of death, the business owner's estate could elect to temporarily defer certain estate taxes under IRC 6166, if the estate qualifies, and pay the estate tax obligation on an installment basis. However, the business owner might also consider how the liquidity available from a life insurance policy can be used in combination with, or even as a cost-effective alternative to, this tax deferral option under IRC 6166.

The Wealth Transfer Planning Through the Use of the 6166 Election and Life Insurance module effectively illustrates the relative cost to the estate in terms of the present value of dollars spent when a 6166 election is made as compared to, or in combination with, the purchase of a life insurance policy today to help fund the business owner's future liquidity need. This module provides a cost-benefit analysis to help clients and advisors assess the options carefully.

Buy-Sell Planning

John Hancock's Advanced Markets Group has added new features to its Buy-Sell Planning suite of modules, and developed the new One-Way Buy-Sell module to illustrate the transfer of ownership from one business owner to a key employee.

Many business owners do not make formal plans to transfer the business to the other owners in the event of retirement, disability or death of the owner. Lack of planning can cause a business to fail because of the significant changes that are brought about due to these triggering events. Although in some cases a Buy-Sell arrangement is in place dictating how the business is to transfer, often these arrangements remain unfunded.

A Buy-Sell plan can be designed in a number of ways to take into account the structure of the business, who the recipient of the business interest will be, who has been designated to run and own what part of the business, as well as the estate planning needs of the surviving heirs. For example, when there are a few business owners, a Cross-Purchase or Cross-Endorsement Buy-Sell agreement may work well. Or, when there are multiple business owners, an Entity Purchase might be a more efficient plan.

However, in some cases there may be only one business owner and one valued employee that the owner has identified as the successor. In these situations, a One-Way Buy-Sell arrangement between the successor and the owner can provide the funds and clarification as to who will run the business after death, retirement or disability. And, when the arrangement is funded with a permanent life insurance policy, the plan provides the flexibility to accommodate the business owner's changing needs over the life span of the business.

Mr. Zipse said the Advanced Markets Group is marking JH Solutions 10th anniversary knowing that a back to basics approach in defining the value of life insurance is as relevant today as it was a decade ago. He said the two modules to be introduced focus on this back to basics theme.

"Life insurance is truly a Life Solution," Mr. Zipse said. "Now is the time -- more than ever -- to put one's affairs in order with a Life Solution from JH Solutions by doing basic protection planning from income replacement needs for survivors to achieving estate and business succession objectives."

The Power of Permanent Coverage

This module helps producers and clients determine whether permanent insurance may be the most appropriate type of coverage given a client's needs. It helps clients consider Term coverage if they believe the rate of return on the difference between the cost of Term and Permanent -- guaranteed when the John Hancock Protection UL-G product is used -- can be reasonably achieved. It walks clients through how much risk they are willing to take and how much risk they want the insurer to take. It helps them consider their changing needs over lifetime and what insurance protection they and their family may need after the Term coverage ends.

Needs Analysis

This Needs Analysis module helps producers and clients determine the appropriate amount of insurance coverage the clients will need to secure their financial future. The value of life insurance when it comes to family protection is that it provides the death benefit in the form of cash, in a timely fashion. The life insurance death benefit can be used to pay off a mortgage and education obligations, and to replace lost salary to pay for ongoing household expenses, debts, and even outstanding tax bills.

For more information on these concepts, or to find out more about getting an illustration, contact your local John Hancock representative or call John Hancock Life Insurance at 888-266-7498, Option 3.

The John Hancock Advanced Markets Group is comprised of a highly experienced and knowledgeable team of attorneys, accountants and consultants. They support producers nationwide on the most complex business insurance and estate planning cases with customized case design support and consultation and advanced planning tools.

JH Solutions Modules

     --  Invest in Your Life     --  Income Maximization     --  Qualified Plan Maximization     --  Charitable Remainder Trusts     --  Making Lifetime Gifts     --  Spousal Access Trust     --  Wealth Transfer Planning     --  Buy-Sell Arrangements     --  Cross Purchase     --  Cross Endorsement     --  Executive Bonus and Restrictive Endorsement Bonus Arrangements (REBA)     --  Split Dollar Arrangements     --  Premium Financing     --  Dual Loan Approach     --  LIRP     --  Annuity Maximization     --  Municipal Bond Maximization     --  Charitable Lead Trusts     --  Life Insurance in Land Conservation     --  Dynasty Trust     --  Credit Shelter Trust     --  Using 6166 Election & Life Insurance     --  One-Way     --  Entity Purchase     --  Key Man Insurance     --  Supplemental Executive Retirement Plans (SERPs)     --  Sale to a Grantor Trust     --  Private Financing     --  Private Split Dollar     --  Term vs. Permanent Insurance 

About John Hancock Financial and Manulife Financial Corporation

John Hancock Financial is a unit of Manulife Financial Corporation (the Company), a leading Canadian-based financial services group serving millions of customers in 19 countries and territories worldwide. Operating as Manulife Financial in Canada and in most of Asia, and primarily as John Hancock in the United States, the Company offers clients a diverse range of financial protection products and wealth management services through its extensive network of employees, agents and distribution partners. Funds under management by Manulife Financial and its subsidiaries were Cdn$405 billion (US$330 billion) as at December 31, 2008.

Manulife Financial Corporation trades as 'MFC' on the TSX, NYSE and PSE, and under '945' on the SEHK. Manulife Financial can be found on the Internet at www.manulife.com.

The John Hancock unit, through its insurance companies, comprises one of the largest life insurers in the United States. John Hancock offers a broad range of financial products and services, including life insurance, fixed and variable annuities, fixed products, mutual funds, 401(k) plans, long-term care insurance, college savings, and other forms of business insurance. Additional information about John Hancock may be found at www.johnhancock.com.

Insurance products are issued by: John Hancock Life Insurance Company (U.S.A.), Boston, MA 02116 (not licensed in New York) and John Hancock Life Insurance Company of New York, Valhalla, NY 10595.

This material does not constitute tax, legal or accounting advice and neither John Hancock nor any of its agents, employees or registered representatives are in the business of offering such advice. It was not intended or written for use and cannot be used by any taxpayer for the purpose of avoiding any IRS penalty. It was written to support the marketing of the transactions or topics it addresses. Comments on taxation are based on John Hancock's understanding of current tax law, which is subject to change. Anyone interested in these transactions or topics should seek advice based on his or her particular circumstances from independent professional advisors.

SOURCE John Hancock Advanced Markets