Long Term Care
Long Term Care
Long Term Care
Annuities
Annuity “Doublers” can help with Long Term Care
Presented by Richard Mangiameli More and more seniors are experiencing the need for, as well as the stress associated with, Long Term Care insurance (LTCi) benefits. Seniors are concerned that when they need help with some activities of daily living (ADLs) and are required to move into an assisted living facility or require medical help with nursing home benefits, that the cost of those facilities could wipeout their hard-earned savings and assets. They know the importance of having LTCi benefits, but are also concerned about the cost of a LTCi policy. This is where an annuity that has an income doubler can help clients protect their assets and help close the insurance gap. With an annuity doubler option, there is no underwriting and there is only a small fee incurred, typically less than ½ of a percent. The payment stream could be as long as ten years. As an example: take a male who is 65 years old and repositions $250k into this annuity. The income five years later will be $24k per year. If you cannot perform two of the six ADLs, the income will double to $48k per year. Following is an article I read from the NAIFA SmartBrief by Andrew Murdoch that further explores this topic. http://www.marketwatch.com/story/how-annuity-doublers-can-help-with-long-term-care-2015-04-21
Long Term Care
Taking Care of Our Fathers’ Generation
Presented by Leonard Berthelsen It’s now been six weeks since the loss of my good friend who suffered in his later years with the debilitating effects of Alzheimer’s. I have reflected often over these six weeks about his life; the energy, the vibrant personality and the zest for life that he had until that final year. It is so sad to see the effects of this disease and what it drains from a person right before your eyes. My friend was married, had two wonderful children and three grandchildren. He always had a smile on his face, teased people immensely and was forever volunteering to help others – exactly what you would want in a friend, father, grandfather and husband. As his generation takes their final journey, I find myself asking “Are we taking care of our fathers’ generation as well as we can?” So what does this have to do with insurance, or the profession we decided to make our life’s work? We have the opportunity AND responsibility to make sure that the final journey is as smooth as possible without the pitfalls that come from the financial crisis that comes far too often to so many people who have not planned for the final journey of life. In the weeks leading up to my friend’s death, I was visiting with his wife about some of the financial issues she was experiencing and she told me, “I don’t know what I would have done if we didn’t have long term care insurance.” He was in a specialized memory care facility with others experiencing that same final journey. He stayed in that care facility for nearly two years. The final year he experienced difficulty remembering people and names, but yet still maintained his sense of humor and love for his family. I have been in this business for over 30 years and have had a lot of clients experience similar journeys – and it is never easy with any of them. My comfort comes from knowing that I did what I could to make that journey a little less painful and a little less stressful without it becoming a financial crisis. Are you taking care of our fathers’ generation? Are you doing everything that you can to make that journey less painful? Are you providing the guidance that your clients so desperately need? Ask yourself these questions. Maybe it’s time to refocus on our mission and help others with that final journey.
Long Term Care and Disability Insurance
As a Producer, it Might be a Good Time…
Presented by Leonard Berthelsen There has been a fair amount of concern and frustration in recent years among producers and consumers towards long term care insurance and what seemed like never-ending rate increases. The amount of uncertainty related to increased rates are concerning to both existing clients and new prospects. Rate increases in previously written blocks of business probably will have some additional adjustments in years to come as the carriers grapple with trying to keep those plans above water and still profitable, especially in this low interest rate environment. We certainly want them to pay their claims and fulfill their commitment to their policyholders, so rate adjustments become a necessary evil. Carriers today now possess more experience with this product which provides an opportunity to better understand the claims process, persistency and mortality which all bode well in the pricing of new plan designs that carriers are implementing. Carriers are concerned with having to raise rates on clients after they purchase the insurance and are looking for ways to mitigate that issue as much as possible. Some carriers have introduced plans that have small automatic increases in premiums at set intervals throughout the plan’s lifetime. These plans are still competitive and affordable and this design could potentially prevent rate increases later down the line. Others have brought out plans that have a credit account built into their product that allows the credits, accumulated over time, to be used to offset any rate increase that the carrier may need. Again, this is another attempt to find a way to minimize the need for rate adjustments later on. Additionally, the hybrid and linked benefit products could be the right product for some clients. If the client is investing money into an annuity, and long term care needs are even a mild concern to them, then having an annuity with long term care benefits might just make sense. Even if long term care issues never present themselves, the annuity value is still there to provide income or a means of funding their legacy. There are linked benefit products that give life insurance and long term care equal footing in the plan. If the long term care benefit is never used then the life insurance is paid out at time of death. If long term care is needed, then the life insurance amount available for payout at death would be reduced. The benefits are paid out one way or another. Another option carriers are looking at is pricing for high deductible long term care plans. A consumer would select a high deductible ($50,000 -$300,000) plan and the insurance benefits would start after the deductible is met. We are seeing a different thought process as well as a different mindset from carriers regarding new innovative product designs. They realize that their products have to offer the benefits wanted by today’s consumer at a price that is affordable. Long term care insurance products are changing but their importance is not. There are many different ways to protect your client and their assets from a long term care issue. The important thing is that you’re having the conversation with your clients about their long term care needs and showing them the many different solutions you can provide.
Long Term Care and Disability Insurance