|Premium Payments||Benefit Qualification||Benefit Amount|
|Pf Payment Frequency||Pa Payment Amount|
|Lg Lapse Guarantee||Tc Tax Code||Pm Payment Method|
|Wp Waiver of Premium||Ep Elimination Period||If Inflation|
It is important to point out to the prospect that what we see frequently happen, is the healthy spouse/partner becomes the care giver for that uninsurable spouse/partner. Many times that can happen much sooner than what anyone anticipated. As a result of being that caregiver, the health of the insurable spouse/partner declines rapidly due to the stresses of being that caregiver. It has been reported that up to 60% of caregivers were unprepared for the physical demands of being that caregiver.1 There is probably not a better argument for the healthy spouse/partner to consider and purchase LTCi.Mutual of Omaha’s MutualCare LTCi policy has a very unique rider, called the Security Benefit Rider that can be added to an LTC policy to provide a solution for just such a situation. If the insured spouse/partner requires long term care services after the policy is in effect, the Rider can be activated to provide additional funds to help pay for the cost of providing care for the uninsurable spouse/partner. Up to 60% of the insured’s monthly reimbursement benefit is made available to help pay for approved care for the uninsured spouse/partner. There is no medical underwriting required for this Rider, and the additional benefits paid out for the approved care do not reduce the insured’s policy limits. It is a separate benefit for an uninsurable spouse. Unfortunately, there will be times when a producer will find themselves in a situation where couples/partners apply for coverage and one is declined. When this happens, we often will hear “If we both can’t get it, than we don’t want it”. You might want to consider this rider, as it might just be the answer to saving the sale. This unique feature when understood, can be a great relief for uninsurable spouses/partners. Talk with one of the LTCi marketing specialists at Financial Brokerage about more details on how this rider works.
- Transamerica LTC study 2015
Make it easy
I realize the example in part two did not take into account the fact that a beneficiary receiving a lump sum could invest that amount and receive more than the lump sum divided by 20 each year over 20 years. Assuming a modest 3% interest rate, $735,490 would provide the beneficiary $50,000 per year for 20 years. A 30 year term life policy based on that face amount would cost only $638 per year. That’s actually slightly lower than the income stream death benefit price of $647.75 quoted previously. Why would a client pay an extra dollar per month for the income stream? Simplicity. What’s easier to understand: “$50,000 for 20 years” or “$735,490 invested at 3% should generate an income stream of $50,000 per year for 20 years. “
Sometimes we fail to understand the majority of the population does not deal with interest rates, inflation and compound growth on a daily basis. Keep it simple.
For income replacement life insurance sales, consider using the income stream death benefit option. It will help you close more life insurance sales, potentially save your clients money and certainly give them a better understanding of how their coverage works.