INSURANCE COORDINATION FOR CPAS AND FINANCIAL ADVISORS
Kelly Insurance Group provides specialist insurance coordination for CPAs and financial advisors whose high-net-worth and high-income clients require insurance that is coordinated with their tax planning, financial planning, and overall financial management — life insurance in the financial plan, business insurance deductibility, estate planning insurance coordination, and the personal risk management gaps that CPAs and financial advisors are in the best position to identify.
HOW KELLY INSURANCE GROUP SUPPORTS CPAs AND FINANCIAL ADVISORS IN PROVIDING COMPLETE CLIENT SERVICE.
Life insurance plays multiple roles in a high-income client's financial plan — income replacement for term coverage, wealth accumulation and tax-deferred growth for permanent coverage, and estate planning for ILIT-owned coverage. A financial advisor who includes insurance in the financial plan needs a specialist insurance partner who can review existing coverage, identify gaps, and place coverage that is appropriate for the client's current financial situation.
CPAs managing business client financials encounter insurance premium deductibility questions regularly. The general framework — business-purpose insurance premiums are generally deductible as ordinary business expenses — has important exceptions: key person life insurance where the business is the beneficiary is generally not deductible; premium deductibility for group insurance depends on employee benefit rules; and the tax treatment of insurance proceeds depends on whether the payout is for casualty loss or business income. Understanding the general framework, and knowing when specialist input is needed, is part of comprehensive CPA practice.
A CPA managing a high-income client's tax compliance has visibility into the client's financial profile that positions the CPA to identify personal insurance gaps. A client who recently sold a business and has a suddenly elevated net worth but an unchanged umbrella limit. A client whose income has grown significantly but whose life insurance has not been reviewed in years. A client with a valuable art collection that appears in their personal financial statement but not in their insurance documentation. These are observations that CPAs are uniquely positioned to make — and that represent an opportunity to provide additional value to the client.
A high-income professional or business owner whose income is their primary financial asset needs disability income insurance that reflects their current income level. Group disability coverage from an employer typically covers a fraction of a high-income professional's total compensation. Individual disability income insurance — placed at appropriate benefit amounts and with own-occupation provisions — is a specific insurance planning need for high-income clients that financial advisors and CPAs are positioned to identify.
When a CPA or financial advisor identifies an insurance question in the context of a client engagement — a life insurance review needed as part of a financial plan, a business insurance deductibility question that requires specialist input, or a personal risk management gap — the most efficient resolution is a referral to Kelly Insurance Group. We handle the insurance conversation with the client, communicate with the CPA or financial advisor at whatever level is most useful, and provide an insurance perspective that complements the tax and financial planning engagement.
CPA AND FINANCIAL ADVISOR INSURANCE SUPPORT SERVICES
CPAs AND FINANCIAL ADVISORS WHO WORK WITH KELLY INSURANCE GROUP.
Any CPA or financial advisor whose high-net-worth and high-income clients have insurance questions — life insurance in the financial plan, business insurance deductibility, personal risk management gaps — benefits from a specialist insurance partnership with Kelly Insurance Group.
- CPAs managing high-income client financials who regularly identify insurance questions in the context of tax and financial review
- Financial planners who include insurance in comprehensive financial plans and need a specialist insurance partner for implementation
- CPA firms with high-net-worth client practices that want a specialist insurance referral partner for the insurance dimensions of their client engagements
- Financial advisors who want to identify and surface personal insurance gaps as part of comprehensive wealth management
- Business CPAs whose clients ask insurance premium deductibility questions that require specialist input
- Any CPA or financial advisor who has identified a client insurance gap but does not have a specialist insurance partner to refer the client to
SELECT A COORDINATION AREA TO SEE HOW KELLY INSURANCE GROUP SUPPORTS CPAs AND FINANCIAL ADVISORS.
CPAs and financial advisors encounter insurance questions across tax planning, financial planning, and business client work. Understanding each intersection helps advisors provide more complete and coordinated client service.
CPAs managing high-income client finances encounter life insurance questions with tax implications — the income tax treatment of policy cash values and death benefits, the estate tax implications of policy ownership, the use of life insurance in tax-efficient wealth transfer strategies, and the annual reporting of policy-related income. Kelly Insurance Group provides life insurance coordination specifically designed for CPA and financial advisor collaboration.
- Death benefit income tax treatment — generally income tax free under IRC Section 101
- Cash value growth — generally income tax deferred inside a permanent life policy
- Policy ownership and estate inclusion — policies owned by the insured are included in the estate
- ILIT life insurance — removing death benefit from taxable estate
- Annual reporting — Form 1099-R for surrenders, exchanges, and distributions
WHAT KELLY INSURANCE GROUP PROVIDES.
LIFE INSURANCE REVIEW AND PLACEMENT FOR FINANCIAL PLANNING
Life insurance review against the client's current financial plan — confirming that existing coverage is adequate, identifying gaps, and placing term or permanent coverage appropriate for the client's current income, net worth, and planning objectives.
DISABILITY AND LONG-TERM CARE INSURANCE
Disability income insurance for high-income professionals — at benefit amounts and with policy provisions appropriate for their income level — alongside long-term care insurance review as a component of comprehensive retirement and estate planning.
PERSONAL RISK MANAGEMENT GAP IDENTIFICATION
Review of the client's personal insurance program against their current financial profile — umbrella adequacy, agreed values on homes and collections, household employer coverage — identifying gaps that affect the client's overall financial risk position.
ANNUAL INSURANCE REVIEW COORDINATED WITH FINANCIAL PLANNING
Annual insurance review conducted in coordination with the financial planning review — confirming that the insurance program reflects the client's current financial situation and is coordinated with their tax planning, financial plan, and estate plan.
FOUR INSURANCE SITUATIONS CPAs AND FINANCIAL ADVISORS IDENTIFY IN CLIENT ENGAGEMENTS.
A business sale that produces a significant net worth event creates an immediate personal umbrella review trigger. A client who receives $10 million from a business sale and still has a $1 million umbrella is significantly underinsured for their new financial profile. The CPA managing the transaction is in the best position to identify this and refer the client for an insurance review.
An ILIT life insurance policy that was placed when the trust was formed — and has not been reviewed since — may be inadequate for the client's current estate planning needs, may be performing below original projections, or may have policy provisions that no longer align with the estate plan. Annual policy review is a standard ILIT management practice.
A professional or business owner earning $500,000 annually with no individual disability income insurance is one serious illness or injury away from a complete income loss. Group disability coverage from an employer — if any — typically covers 60% of base salary up to a monthly cap, leaving a significant uninsured income gap for high earners. The financial advisor managing this client's financial plan should identify and address this gap.
A client whose personal financial statement includes significant art, jewelry, or collectibles — and whose homeowners policy has standard personal property sublimits — is carrying a coverage gap on assets that the financial advisor is managing. Referring the client to Kelly Insurance Group for a valuable articles policy review addresses the gap and protects the assets being managed.
QUESTIONS ADVISORS OFTEN ASK.
Are life insurance death benefits taxable?
Generally, life insurance death benefits paid to a beneficiary are income tax free under Section 101(a) of the Internal Revenue Code. However, the death benefit may be included in the insured's taxable estate if the insured owned the policy at the time of death — which is why ILIT ownership is commonly used to remove the death benefit from the taxable estate. Kelly Insurance Group does not provide tax advice; we recommend reviewing specific situations with a qualified tax advisor.
Are business insurance premiums tax deductible?
Generally, insurance premiums paid for coverage that is ordinary and necessary for the business are deductible as business expenses. Key person life insurance premiums where the business is the beneficiary are generally not deductible. Group insurance premiums paid as employee benefits are generally deductible within applicable limits. The specific deductibility of any premium depends on the specific coverage type, how it is structured, and the business entity type. Consult a tax advisor for specific guidance.
What individual disability income insurance benefit amount is appropriate for a high-income professional?
Individual disability income insurance coverage for a high-income professional should be sufficient — combined with any group coverage — to replace 60% to 70% of the professional's pre-disability income. High earners typically face a gap between available coverage and their actual income level. The appropriate benefit amount, waiting period, and benefit period depend on the professional's income, occupation, and other income sources.
How does Kelly Insurance Group work with financial planners?
We serve as the insurance implementation partner for financial planners — reviewing existing coverage against the financial plan, identifying gaps, and placing coverage that is appropriate for the client's current financial situation. We communicate with the financial planner at whatever level is most useful for the planning engagement, provide clear insurance recommendations that fit within the financial plan, and conduct annual reviews coordinated with the financial planning review.
What should I do when I identify a personal insurance gap for a client?
Refer the client to Kelly Insurance Group. An introduction by email or phone is all we need. We review the specific gap, explain what coverage is needed, and place appropriate coverage for the client's situation. We communicate back to you on the resolution and make you look good in the process.
Can Kelly Insurance Group participate in a financial planning meeting with a client?
Yes. We are comfortable participating in financial planning meetings — as a specialist insurance resource — when that level of coordination is useful for the advisor's engagement model. The appropriate level of involvement depends on the specific situation and what the financial planner finds most useful.
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A SPECIALIST INSURANCE PARTNER FOR THE INSURANCE DIMENSIONS OF YOUR CLIENT ENGAGEMENTS.
Kelly Insurance Group provides specialist insurance coordination for CPAs and financial advisors — life insurance in the financial plan, disability income and long-term care, personal risk management gap identification, and annual review coordinated with the financial planning engagement.
The availability of coverage and eligibility for coverage can depend on numerous factors. We cannot guarantee that all customers, individuals, and businesses looking for coverage will be successful in these efforts when contacting our team. All policy coverages and terms need to be fully reviewed by the respective consumer to ensure the coverage asked for is what is specifically being quoted or provided by any insurance policy. Insurance Policies, Coverage Changes, and their terms and conditions are not bound or altered until written confirmation is provided by one of our licensed team members or underwriters. This page does not offer legal advice, legal opinions, or policy interpretations. Rather, this page is meant as a resource to help provide customers and insurance consumers with additional considerations that may help in their insurance buying or pursuit of insurance information. Kelly Insurance Group does not employ or direct attorneys.
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Disclaimer: Coverage availability and eligibility may depend on many factors, including underwriting review, carrier guidelines, policy terms, state requirements, business operations, risk characteristics, and other information provided during the application or quoting process. Kelly Insurance Group cannot guarantee that every individual, customer, organization, or business seeking coverage will qualify for, receive, or successfully place insurance coverage. All policy coverages, exclusions, conditions, limits, endorsements, and terms should be carefully reviewed by the consumer, insured, or applicant to confirm that the coverage requested is the coverage being quoted, offered, or provided. Insurance coverage, policy changes, endorsements, cancellations, and other policy terms are not bound, changed, confirmed, or altered unless and until written confirmation is provided by a licensed Kelly Insurance Group team member, the applicable insurance carrier, or an authorized underwriter. This page is provided for general informational purposes only and does not provide legal advice, legal opinions, insurance coverage opinions, or policy interpretations. Information on this page should not be relied upon as a substitute for reviewing the actual policy language or consulting appropriate professional advisors. Kelly Insurance Group does not employ, supervise, or direct attorneys.