Life insurance representatives flock to DC to defend tax incentives
Insurance executives and advisers, many of whom are represented by the National Association of Insurance and Financial Advisers, are flocking to Washington D.C. this week in order to warn federal lawmakers not to make changes to the preferential tax incentives that are offered to the life insurance industry. The life insurance sector in the U.S. has received these tax incentives, in one form or another, for the better part of a century, but financial concerns and the problematic performance of the sector over the past several years have encouraged lawmakers to seek revisions of these incentives.
Tax incentives represent certain financial burden for federal government
Insurance professionals claim that the incentives help insurers make life insurance coverage more attractive to consumers. The incentives allow for a certain level of freedom for insurers to create products that meet the needs that consumers may have and encourage these people to purchase coverage either for themselves or for their loved ones. Lawmakers argue that these tax incentives have long been a financial burden for the federal government, which is looking to address the increasingly serious issues regarding national deficit.
Tax reform continues to be a focus for Congress
Tax reform has become a major focus for Congress in recent months. Lawmakers are setting their sights on addressing the problematic financial issues that the country currently faces. Over the past few months, several potential reformation plans have taken form, but few of these plans have managed the acquire a significant amount of support. The life insurance industry is especially concerned about how these reform plans may play out as changes to tax laws can have a monumental impact on the market and the industry’s ability to compete therein.
Life insurance companies leverage tax incentives as marketing tool
One of the reasons the life insurance sector is concerned over the issues of the tax incentives is the fact that many insurers leverage these incentives as a marketing tool. Life insurance companies often tout these tax incentives as a reason t heir coverage is so inexpensive or that their policies are able to offer the benefits they do. As a marketing tool, these tax incentives have helped many life insurance companies find success in a market that has been riddled with its own issues over the past few years.