More Than One Way To Pay

One thing that we always discuss from a planning perspective is how will you pay. How will you pay for care if it is needed ? How will you pay if you have to provide care yourself? How will you pay the premium for your policy?

As Harley Gordon says, every decision has consequences. And, the consequences of not having a plan (more specifically, a funded plan) can be severe.

We are a few days out from LTC Awareness month and I am confident that you have heard repeatedly the consequences associated with not having a plan or having an unfunded plan. Today, I am going to focus on the breadth of funding options offered by the OneAmerica Care Solutions portfolio.

As you will recall, the Care Solutions portfolio is based upon a based policy plus continuation of benefit rider design. That base policy will be either participating whole life insurance policy (except CA) called Asset Care, a fixed deferred annuity, or a fixed indexed annuity (called Annuity Care).

One advantage of the Care Solutions portfolio, from an underwriting perspective, is that if your client is not eligible for Asset Care, she/he may qualify for Annuity Care. And, that alternative will be shared with you as part of the underwriting decision.

I digress – the point of today’s conversation is funding options. And, the Care Solutions portfolio has a boatload. Here is a link to the “Protection at Your Fingertips” piece also known as funding sources.

Historically, asset based long term care products were designed as a single premium product funded by either a 1035 exchange or cash.

As time progressed, recurring premiums also became options. With Asset Care, those recurring premiums can be paid in the following formats: 5-pay, 10-pay, 20-pay, or to age 95. Annuity Care does not allow for this funding strategy and is single premium only for the base portion of the policy. (Note: premiums are guaranteed never to increase once the policy is placed in force.)

One unique feature that the Care Solutions portfolio offers is the ability to accommodate a single premium (1035 exchange or dump-in) for the base policy and accept recurring premiums for the continuation of benefit rider.

Another unique feature of Asset Care is the “turn-key” funding solution offered for qualified money. Last week, I shared some basic information about using qualified money as a funding source. You can search Fridays with Fisher for qualified money and pull up all of posts on that subject.

Another unique strategy that Asset Care offers is the Single Premium Drop-in Rider. This allows for a policy being funded via recurring premium to accept additional funds via cash or 1035 exchange via drop-in. Check out the specifics in this post.

We, at OneAmerica, have a boatload of planning and protection ideas for qualified and non-qualified money. Please, feel free to reach out to me for more information at (678) 512-9627 or kevin.fisher@oneamerica.com

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The ideas and information shared by Fridays with Fisher is for use by financial professionals and is not intended for distribution to the general public.