This past Tuesday on LTC Coffee Break, we shared one of the unique features of Asset Care – the Single Premium Drop-In Rider (SPDR). Today, I want to expand on that idea.
Check out this week’s episode and more at LTCcoffeebreak.com.
And, remember to join us on June 28 when we share our summer six pack of ideas with you.
Just a reminder, the SPDR rider is available with Asset Care policies that are funded using recurring premiums ( 5 pay, 10 pay, 20 pay, or to age 95). It can accept up to $100,000 of drop-in up to 6 months after the policy is issued. However, it must be elected at the time of application. Please note, SPDR is not available in California.
Here is an idea for you …
Do you have a client who you are looking to provide a long term care funding solution and has a life insurance policy with a low cash value that is not relevant or has a CD maturing?
If that money is under $100k, you can’t get much leverage in an asset-based LTC product. Your best option is a recurring premium solution. The SPDR allows you to infuse cash into your Asset Care policy and buy paid-up benefits.
Let’s see how this works for a woman age 67 purchasing $5,000 of monthly LTC benefits using a 25 month base policy with 50 month continuation of benefits without inflation and paying premiums to age 95. (Remember, Asset Care offers a built-in waiver of premium and all premiums and benefits are guaranteed.)
On a pay to age 95 basis without any drop-in, the annual premium is $7,826.
If she drops in $20,000, then the annual premium is reduced to $6,419.
And, $40,000 will reduce it to $5,111.
One cool feature of the SPDR is that you can make two drop-in payments and come from either cash or a 1035 exchange. Remember, you will need to include the SPDR election at application.
The SPDR rider can be illustrated using our online system in OLS or on the Care Solutions Calculator.
To learn more about the SPDR Rider or any Care Solutions products and strategies, contact me via email at kevin.fisher@oneamerica.com, call me at (678) 512-9627, or schedule a meeting with me using this link.
And remember to join Michael Florio and me on June 28 when we share our six pack of ideas at LTC Coffee Break … ltccoffeebreak.com
Fridays with Fisher 