Author: Sean Drummey

Life insurance bundled with long term care and critical illness

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June 16, 2011

11:32 AM

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Accelerated Benefit, Accelerated Benefits, Accelerated Death Benefits, Alzheimer's, Chronic Illness Rider, Critical Illness, In your 50's, In your 60's, In your 70's, life insurance and long term care, Living Benefits, long term care insurance, long term care plans, Universal Life

Life insurance can now fund long term care or critical care expenses. Turn your death benefit into a living benefit. American National now offers an impressive group of accelerated benefit riders at no extra charge.

There are three living benefits:

  • Chronic   –  Payment of an accelerated benefit if the insured cannot perform 2 of 6 activities of daily living or cognitively impaired. This is the criteria for long term care insurance benefits with traditional LTC plans.   Use your life insurance to augment your LTC insurance, cash comes in handier than expense reimbursement, or have your life policy serve as your contingent LTC insurance.
  • Critical   –  Payment of an accelerated benefit if the insured experiences a critical illness. American National says 16 different illness, but details and definitions must be referred to on the specific rider
  • Terminal  –  Payment of an accelerated benefit  if insured has less than 24 months to live. Most life insurance coverage has this terminal illness rider.   It’s 12 months in certain states.

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Indexed Survivorship Life Insurance

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June 10, 2011

1:37 PM

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Age 65, Equity Indexed Universal Life Insurance, Indexed Survivorship Universal Life, Survivorship Life Insurance, Survivorship Universal Life

Indexed Survivorship Universal Life increases the upside cash value potential by having interest indexed to equities.  No money is actually invested in equities, so there is less downside risk, as with variable universal life.

Compared here is Prudential,  the most competitive guaranteed survivor universal life (GSUL) at age 65, verses North American’s Survivorship GIUL , guaranteed indexed universal life.

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Couple considers life insurance as estate plan for children

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June 6, 2011

3:56 PM

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Age 69, Age 70, In your 60's, In your 70's, Survivorship Life Insurance, Survivorship Universal Life

A couple nearly 70 years old and in good health asked a newspaper financial columnist if it was too good to be true that a $200,000 life insurance policy could provide an $800,000 tax free benefit for their children.

Well, $800,000 sounds like a bit of a stretch, especially if you want to play it safe with a guaranteed policy.  Hovever, the general concept is valid.

They are talking here about a survivorship universal life policy, called a SUL or second-to-die.   And they’re probably talking about the $200,000 as a single pay, one single lump sum payment with no further premiums.    The columnist gave a fairly good answer, and warned about guaranteed and non guaranteed elements.   Well, that’s a traditional SUL, and to get anywhere near $800k with a $200k single pay, you’d have to look at a SUL.

There is also Guaranteed SUL, of G-SUL.  The benefit won’t be as high, but it’s guaranteed to age 120, so you don’t have to worry about the policy’s performance or outliving your policy.

Here’s what a Guaranteed SUL looks life for someone in “good” health.  Two rate classes, preferred and Non-Smoker Plus, with Prudential are health rates that mean good.  Prudential is generally the strongest carrier right now for G-SUL, but you would have to compare rate given the couple’s health factors.

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Permanent life insurance more suitable for seniors than term

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June 6, 2011

12:50 PM

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Age 60, Age 61, Age 62, Age 63, Age 65, Age 66, Age 67, Age 68, Age 69, Age 70, Age 71, Age 72, In your 70's, In your 80's, Product

Over the last few days, I compared life insurance websites for seniors in ages 60 through age 72 by Google searching life insurance and adding an age, “life insurance age 68”  for example.   It’s misleading for those in their 60’s and 70’s to see at the top of Google’s list websites with term life insurance given such prominence. Term is not usually the right product for seniors.  The primary purposes of term are to replace lost income or settle an outstanding debt like a mortgage.   Sure if you have less than 10 years to go on a mortgage, term life insurance might make sense.   I would surmise term gets promoted and sold simple because it’s less expensive.  But if one buys term in your 60’s or 70’s, chances are you will outlive your term, and then you’ve paid all that premium for nothing.  Even if you take the best term out there, Genworth, and have the option to convert to a fixed rate universal life, you have to pay higher premiums as your age goes up.

For the majority of people in their 60’s and 70’s permanent life insurance is the most suitable coverage.  If at all healthy, guaranteed universal life insurance is the best.  Coverage starts at a $25,000 benefit amount, and premiums are affordable.  North American has an excellent G-UL right now.   There are also small whole life policies, called simplified issue because there is only a short questionnaire and no blood term.  Coverage starts at a $2,000 a $3,000 benefit amount.   Either choice is better than term because it’s fixed rate coverage for life.

 

Woman buying most life insurance plus long-term care insurance

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June 1, 2011

1:41 PM

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Accelerated Benefit, Accelerated Benefits, Accelerated Death Benefits, Chronic Illness Rider, guaranteed universal life, In your 50's, In your 60's, In your 70's, life insurance and long term care, Living Benefits, long term care insurance, long term care plans, Universal Life

Woman buy 60% of the life insurance plus long-term care insurance policies, according  to research by the American Association for Long-Term Care Insurance.  34% of the woman were between 55 to 64, and 40% were between ages 65 to 74.

North American has the best deal for life plus chronic illness benefit.   It’s a universal life policy that can accelerate out 24% a year in cash for chronic illness.   End up not needing long term care?   Your beneficiaries get the full policy face amount or whatever you haven’t accelerated out for long term care.    Also North American policy face amounts start at $25,000 of coverage, so premiums can fit any budget.

For larger face amounts there are single premium policies with Genworth and Lincoln National that offer many advantages such as return of premium.  There are also annuities that offer long term care riders which extend long term care coverage 2 or 3 times higher than the  face amount.

Judge John J. Carroll III dies at 50

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May 27, 2011

2:19 PM

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Early Grave, In your 50's

About 5 years ago I took my oldest son to a sign up meeting for cub scouts in Hampstead, NC.  Milling around in the back, John Carroll and myself stuck up one of those, do-I-know-you-from-somewhere conversations.  We tried a few names and places but nothing registered.  It was probably our Irish looks which drew us to recognize some distant but unmistakable kinship.  We had a nice conversation.  I remember him talking about Iraq and being a judge.  He was friendly and unpretentiousness.   He was one of those persons who when you first meet ask questions and is really interested in what you had to say.

That was that, and now he’s gone, after a brief illness leaving behind a wife and four children. I asked my son, a 6th grader at Topsail Middle School, if he knew any kids name Carroll. He said yes, Jack Carroll is in his grade, and they had announced Judge Carroll’s passing away over the intercom. I hope Jack is able to remember going to cub scouts with his dad. That fall day 5 years ago, boyhood excitement as in the air, full of plans for being outdoors and weekend camping trips.

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Florida unclaimed life insurance treasure hunt

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May 24, 2011

12:00 PM

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lost life insurance policies, Policy Review

Did a relative of yours ever live in Florida?  Check for unclaimed life insurance at this website run by the Florida Department of Financial Services.

Florida holds over $1 billion in unclaimed property.   Search by your relative’s name.   It’s easy.   There is much more besides life insurance left unclaimed.  Per their website:

The Department of Financial Services, Bureau of Unclaimed Property, holds unclaimed accounts valued at more than $1 billion, mostly from dormant accounts in financial institutions, insurance and utility companies, securities and trust holdings. Unclaimed Property also includes tangible property such as jewelry, coins, currency, stamps, historical items and other miscellaneous articles, from safe deposit boxes.

Guaranteed acceptance life insurance: your last choice

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May 23, 2011

4:59 PM

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Don’t fall for mail order offers for guaranteed issue life insurance or guaranteed issue life insurance. Better options are out there. You can potentially save thousands on premium or get twice as much coverage with another carrier.

I received the other day a mail solicitation from United of Omaha Life Insurance Company for guaranteed acceptance life insurance.  This is also called guaranteed issue life insurance or graded benefit life insurance.  They say “You Cannot Be Turned Down.”  They offered coverage choices from $10,000 to $3,000.

Wait. This is last resort life insurance.  Don’t even consider this until you’re sure you can’t get something better. Just to give you an idea, a 65 year old woman, preferred non smoker rate, can get $25,000 of guaranteed universal life, fixed rate to age 110, with Genworth for less than $10,000 whole life with a 2 year waiting period with United of Omaha for graded benefit whole life insurance.

Take these steps when shopping for a small final expense life insurance policy.

#1 Choice     For excellent, good, average, or even poor health

Fully underwritten life insurance.   Full and immediate benefit.  Applications require a blood test and short paramedical exam.   Carriers generally request your medical records, all at no charge to you.  This way life underwriters can gage your risk classification and make you an offer for coverage.   This will save you lots money over a no physical exam policy.  Genworth and North American offer lifetime guaranteed permanent coverage, called no lapse universal life, starting at a $25,000 benefit, and multiple carriers, including Lincoln National and Aviva, offer coverage of $100,000 and more for seniors.   Unless you’re in really, really poor health, try this first.  There is no cost to you to apply, and the worst they can do is offer you a higher rate or turn you down.

 

Plan B:     2 years after any major health problem, or with multiple serious health problems

If your health is marginal, or you want a smaller less expensive policy than $25,000 with Genworth or North American, the next step is simplified issue whole life.   It has a full and immediate benefit.  There is no physical exam.  There are many, many carriers that want your business. Comparison quote with an independent broker.   AARP offers this type of product but ask yourself, since both AARP and New York Life draw a profit from the policy, won’t going to directly to one carrier be less expensive?   Here are some final expense simplified issue whole life carriers:

  • Liberty Bankers Life
  • Settlers Life
  • Transamerica
  • Foresters
  • Royal Neighbors
  • Columbian Life
  • Philadelphia American
  • American Continental

 

 

Plan C:    Major health problems but not terminal

Graded Benefit Life Insurance If your health is very poor, coverage is offered with a 2 or 3 year waiting period for full benefit.  More expensive

 

Plan D:     Terminal health, or nearly terminal health

Guaranteed Issue Life Insurance No medical questions.   Guaranteed approval.   2 or 3 year waiting period.  Most Expensive.

 

Please contact me for a free and confidential quote.

sean's profile picLicensed Agent:  Sean Drummey
phone:  (910) 328-0447
email:    spdrummey@gmail.com