a sset-based ltc - long term care insurance information ... · -care ®: life insurance--based...

3573735737--04050405 Not For Consumer UseNot For Consumer Use 11

AssetAsset--Based LTC:Based LTC:Setting yourself apart with golden rule Setting yourself apart with golden rule

financial servicesfinancial services


Sound Familiar?Sound Familiar?My wealthy clients just won’t buy traditional My wealthy clients just won’t buy traditional LTC insurance…LTC insurance…

I feel like I offer the same LTC solutions as I feel like I offer the same LTC solutions as three other brokers down the street…three other brokers down the street…

To me, LTC means spread sheeting, To me, LTC means spread sheeting, haggling with underwriting, declines, and 20 haggling with underwriting, declines, and 20 companies selling the same product…companies selling the same product…


Dynamic, Unique, Different: Dynamic, Unique, Different: A Full Portfolio Of AssetA Full Portfolio Of Asset--Based Based SolutionsSolutions

AssetAsset--CareCare®®: Life insurance: Life insurance--based longbased long--term term care solution.care solution.

AnnuityAnnuity--CareCare®®:: AnnuityAnnuity--based “selfbased “self--funding” LTC funding” LTC approach.approach.

ImmediateCareImmediateCare®®: SPIA based “crisis : SPIA based “crisis management” for those already receiving LTCmanagement” for those already receiving LTC..

Legacy CareLegacy Care®®: SPDA designed for the needs of : SPDA designed for the needs of the senior market.the senior market.


Dynamic, Unique, Different: Dynamic, Unique, Different: A Spectrum Of AssetA Spectrum Of Asset--Based Based SolutionsSolutions

Over 15 years of market experience.Over 15 years of market experience.

Proven strategies.Proven strategies.

Products for almost all degrees of Products for almost all degrees of health.health.


AssetAsset--CareCare®* ®*

Wealth accumulation, death benefits, Wealth accumulation, death benefits, tax advantages, estate planning, tax advantages, estate planning,

and LTC protection!and LTC protection!

*Key aspects of the joint life Asset*Key aspects of the joint life Asset--Care have been awarded a patent by Care have been awarded a patent by the U.S. Patent and Trademark Office.the U.S. Patent and Trademark Office.


The Appeal Of The Appeal Of AssetAsset--CareCare

The clientsThe clients::

Joseph S., age 65Joseph S., age 65

Carol S., age 64Carol S., age 64

Their Financial Advisor:

Bill W., fifteen years with Joseph and Carol


Looking For LTC And Looking For LTC And More…More…

The Clients:The Clients:–– $400,000 in assets, not including home.$400,000 in assets, not including home.–– $100,000 CD at a local bank earning minimal interest that is $100,000 CD at a local bank earning minimal interest that is

not taxnot tax--deferred.deferred.–– Good health, and enjoy golfing.Good health, and enjoy golfing.

Should Joe and Carol ever need LTC, they have Should Joe and Carol ever need LTC, they have identified their $100,000 CD as the funding identified their $100,000 CD as the funding source.source.

Concerned $100,000 will not be enough should Concerned $100,000 will not be enough should they both require care, but have never they both require care, but have never purchased LTCi. purchased LTCi.


An Ordinary SolutionAn Ordinary SolutionBill advises all his clients to purchase LTC Bill advises all his clients to purchase LTC protection, but only sells a few cases a year.protection, but only sells a few cases a year.

–– Would like to offer Joe and Carol a solution his Would like to offer Joe and Carol a solution his competition does not.competition does not.

–– Tired of spread sheeting similar traditional LTC Tired of spread sheeting similar traditional LTC products and recommending whatever has the products and recommending whatever has the lowest premium that month.lowest premium that month.


An Extraordinary An Extraordinary SolutionSolutionBill recommends Bill recommends AssetAsset--CareCare to Joe and to Joe and Carol, with their $100,000 CD as the Carol, with their $100,000 CD as the funding source:funding source:

–– AssetAsset--CareCare can offer conservative, guaranteed can offer conservative, guaranteed growth with a minimum credited interest rate.growth with a minimum credited interest rate.

–– And also offers:And also offers:TaxTax--deferred accumulationdeferred accumulationIncome taxIncome tax--free death benefit free death benefit LTC coverageLTC coverageOptional Lifetime coverageOptional Lifetime coverage


The “WinThe “Win--WinWin--Win” Win” Of Of AssetAsset--CareCare$100,000 CD as premium for a single $100,000 CD as premium for a single premium Life/LTC policy:premium Life/LTC policy:

–– $224,270$224,270 second to die, death benefit.second to die, death benefit.

–– $224,270$224,270 shared pool of LTC benefit.shared pool of LTC benefit.

–– $4,485/monthly$4,485/monthly LTC benefit available LTC benefit available for each insured.for each insured.

50 months50 months LTC benefit.LTC benefit.


Comprehensive LTC Comprehensive LTC ProtectionProtectionAn additional annual premium of $2,022 (or An additional annual premium of $2,022 (or $35,594 single premium) will purchase:$35,594 single premium) will purchase:

–– Rider with a lifetime monthly benefit of $4,485 Rider with a lifetime monthly benefit of $4,485 for each insured after exhaustion of the initial 50 for each insured after exhaustion of the initial 50 month benefit.month benefit.

–– Optional 5% annual compound increase of the Optional 5% annual compound increase of the rider benefit amount. rider benefit amount. (additional premium required)(additional premium required)

–– Noncancelable premium (no rate increases).Noncancelable premium (no rate increases).


Better Off Than With Better Off Than With Traditional LTCi?Traditional LTCi?If Joe and Carol should both pass away:If Joe and Carol should both pass away:–– $224,270 income tax$224,270 income tax--free death benefit to free death benefit to

beneficiary.beneficiary.

If they should never need LTC:If they should never need LTC:–– $100,000 single premium grows at a minimum $100,000 single premium grows at a minimum

credited interest rate, taxcredited interest rate, tax--deferred.deferred.

Should either or both require LTC:Should either or both require LTC:–– $4,485 monthly LTC benefit for each.$4,485 monthly LTC benefit for each.


A Myriad Of Funding Options A Myriad Of Funding Options with with AssetAsset--Care Care Versions I Versions I -- IVIV

Single Premium:Single Premium:–– Cash, mutual funds, CDs, 1035 exchanges of Cash, mutual funds, CDs, 1035 exchanges of

existing cash value life insurance policies. (AC I)existing cash value life insurance policies. (AC I)

–– Existing nonExisting non--qualified annuities. (AC II)qualified annuities. (AC II)

–– Even IRAs and qualified money! (AC III)Even IRAs and qualified money! (AC III)

Annual Premium (AC IV):Annual Premium (AC IV):–– 1010--pay.pay.

–– Lifetime pay.Lifetime pay.


Annuity CareAnnuity Care®®

SelfSelf--funding approach to LTCfunding approach to LTC


The “SelfThe “Self--Funders”Funders”The clientsThe clients

Herschel S., age 68Herschel S., age 68

Hattie S., age 67Hattie S., age 67

Their Insurance Representative

Jackson P., CLU, ChFC


“We’ll Pay For LTC “We’ll Pay For LTC Ourselves”Ourselves”

The clients:The clients:–– $1,000,000 estate.$1,000,000 estate.–– Hattie has type I Diabetes.Hattie has type I Diabetes.–– Plan on utilizing their $130,000 nonPlan on utilizing their $130,000 non--qualified qualified

annuity should they ever need longannuity should they ever need long--term care.term care.

Consider themselves too old and too Consider themselves too old and too unhealthy to qualify for LTCi.unhealthy to qualify for LTCi.

If longIf long--term care is needed, they will selfterm care is needed, they will self--insure. (and risk their entire estate)insure. (and risk their entire estate)


Selling To The “SelfSelling To The “Self--FunderFunder””

Jackson has pitched LTCi to Herschel and Jackson has pitched LTCi to Herschel and Hattie several times over the years.Hattie several times over the years.

They have never purchased due to the high They have never purchased due to the high annual premiums and are determined to pay annual premiums and are determined to pay for LTC themselves.for LTC themselves.

A solution utilizing an existing asset would A solution utilizing an existing asset would open an opportunity for these clients.open an opportunity for these clients.


Selling To The “SelfSelling To The “Self--FunderFunder””Utilizing their $130,000 existing Utilizing their $130,000 existing annuity and making it work harder:annuity and making it work harder:

–– Helping to provide the LTC protection Helping to provide the LTC protection they need to:they need to:

Protect the estate.Protect the estate.Limit their risk.Limit their risk.

–– Maintaining the assetMaintaining the asset..


Lifetime ProtectionLifetime Protection

Optional Lifetime LTC Protection

$2,287 Annual PremiumNoncancelable Extension of

Benefits Rider

$130,000 SPDA

“Short-Term LTC”


A “SelfA “Self--Funding” Funding” ApproachApproach$130,000 single premium provides via 1035 $130,000 single premium provides via 1035 exchange:exchange:

–– $3,768/monthly LTC benefit per insured for 36 $3,768/monthly LTC benefit per insured for 36 months.months.

$2,287 annual premium (or $27,838 single $2,287 annual premium (or $27,838 single premium) provides:premium) provides:

–– $3,768 monthly lifetime LTC benefit per insured $3,768 monthly lifetime LTC benefit per insured after exhaustion of the initial 36 month benefit.after exhaustion of the initial 36 month benefit.

Helps protect for a lifetime for significantly Helps protect for a lifetime for significantly less outless out--ofof--pocket than LTCi.pocket than LTCi.


Another “WinAnother “Win--Win”Win”$130,000 single premium to help protect the $130,000 single premium to help protect the millionmillion--dollar estate.dollar estate.

Should LTC never be needed:Should LTC never be needed:–– Annuity Care’s Annuity Care’s SPDA cash value will pass to SPDA cash value will pass to

named beneficiary just as if the original asset named beneficiary just as if the original asset was never used.was never used.

Funding optionsFunding options–– Cash, existing nonCash, existing non--qualified annuities, qualified qualified annuities, qualified

money and IRAs.money and IRAs.–– Consolidation Plan option.Consolidation Plan option.


ImmediateCareImmediateCare®®Crisis management, estate conservation for Crisis management, estate conservation for

those with an immediate LTC needthose with an immediate LTC need

Legacy CareLegacy Care®®SPDA designed for the needs of the senior SPDA designed for the needs of the senior

marketmarket


ImmediateCareImmediateCare®®

Minimize the depletion of assets Minimize the depletion of assets individuals have worked a lifetime to individuals have worked a lifetime to accumulate.accumulate.

Provide a way to help pay for longProvide a way to help pay for long--term care or serious illness costs with term care or serious illness costs with a medically underwritten SPIA.a medically underwritten SPIA.


ImmediateCareImmediateCare®®: : Helping To Helping To Contain The Cost Of CareContain The Cost Of Care

The clientsThe clients

John P., age 87John P., age 87

…AND HIS CHILDREN

WILLIAM AND BETH

Their Family Investment advisor

Mary J., Cfp®, csa


Helping To Contain Helping To Contain The Cost Of CareThe Cost Of Care

The Clients:The Clients:–– JohnJohn: An 87 year: An 87 year--old male with moderate Alzheimer’sold male with moderate Alzheimer’s..

–– WilliamWilliam: John’s son and power of attorney.: John’s son and power of attorney.–– BethBeth: John’s daughter: John’s daughter and current caregiver.and current caregiver.

With her career and family, Beth can no longer care With her career and family, Beth can no longer care for her father herself.for her father herself.

She and William have decided that a move to She and William have decided that a move to assisted living is the best choice, but are assisted living is the best choice, but are concerned about how to best pay for the concerned about how to best pay for the cost.cost.


Helping To Contain Helping To Contain The Cost Of CareThe Cost Of Care

William and Beth want to:William and Beth want to:–– Ensure that as long as their father needs care, it Ensure that as long as their father needs care, it

can be paid for. can be paid for.

–– Protect as much of John’s hardProtect as much of John’s hard--earned estate earned estate (his legacy) as possible from dwindling away. (his legacy) as possible from dwindling away.

Mary wants to identify a solution to a Mary wants to identify a solution to a difficult situation, and maintain the bulk of difficult situation, and maintain the bulk of John’s assets she has under management.John’s assets she has under management.


Finite Assets And A Finite Assets And A Virtually Limitless RiskVirtually Limitless Risk

John’s assets:John’s assets:–– $450,000$450,000

John’s income:John’s income:–– $1,200/monthly from Social Security$1,200/monthly from Social Security–– $800/monthly from a pension$800/monthly from a pension

Assisted living will cost $5,000 a month. Assisted living will cost $5,000 a month.

With an income of $2,000 per month, John With an income of $2,000 per month, John is left with a $3,000 a month shortfall. is left with a $3,000 a month shortfall.


A Piece To Help A Piece To Help Protect The RestProtect The Rest

ImmediateCare Premium Remaining Assets

$319,386$130,614


ImmediateCare ImmediateCare In In ActionActionAssuming care lasts six years and John’s income shortfall continues at $3,000 a month:

$216,000$216,000$130,614$130,614Cost of six Cost of six years of careyears of care

Paying From Paying From AssetsAssets

Purchasing a Purchasing a $3000/monthly $3000/monthly

benefit from benefit from ImmediateCareImmediateCare

Savings vs. paying from assets: $85,386


Financial Security And Financial Security And A Good Night’s SleepA Good Night’s Sleep

A known cost of $130,614 versus the A known cost of $130,614 versus the risk of significantly depleting or risk of significantly depleting or exhausting assets.exhausting assets.

–– William and Beth at ease,William and Beth at ease,–– John’s legacy better protected,John’s legacy better protected,–– A future more secure.A future more secure.


Policy OptionsPolicy Options**

Refund of premium options.Refund of premium options.

Monthly income increase options.Monthly income increase options.

Care coordination / Care advocacy Care coordination / Care advocacy services.services.

* Additional premium required.* Additional premium required.


Legacy CareLegacy Care®®:: An Annuity An Annuity For The Senior MarketFor The Senior Market

The clientsThe clients

Emily F., age 76Emily F., age 76

Lester F., age 77Lester F., age 77

Their Insurance Advisor:

Jonathan T., 22 Years of Experience


A Tough SituationA Tough SituationThe Clients Have:The Clients Have:–– Seven children and 13 grandchildren.Seven children and 13 grandchildren.–– Approximately $800,000 in assets.Approximately $800,000 in assets.–– Lived in the same house for 45 years.Lived in the same house for 45 years.

Emily has been diagnosed with Parkinson’s DiseaseEmily has been diagnosed with Parkinson’s DiseaseLester purchased LTCi over three years ago. Lester purchased LTCi over three years ago. Due to her Parkinson’s, Emily was unable to qualify.Due to her Parkinson’s, Emily was unable to qualify.LTC expenses are a major concern.LTC expenses are a major concern.–– More a “when” than an “if” for Emily.More a “when” than an “if” for Emily.


A Tough SituationA Tough SituationThe Insurance Advisor:The Insurance Advisor:–– Jonathan has been able to provide Jonathan has been able to provide

solutions for almost all of Emily’s and solutions for almost all of Emily’s and Lester’s needs through the years.Lester’s needs through the years.

–– Currently has nothing to offer Emily for Currently has nothing to offer Emily for her LTC concerns but would like to help a her LTC concerns but would like to help a longlong--time client.time client.


A Designated FundA Designated FundEmily and Lester have already set aside Emily and Lester have already set aside $100,000 at their bank as an “LTC fund”.$100,000 at their bank as an “LTC fund”.

Their goals:Their goals:–– Planning for the potential risk.Planning for the potential risk.–– Maximize available resources.Maximize available resources.

Jonathan recommends using the $100,000 Jonathan recommends using the $100,000 to purchase to purchase Legacy CareLegacy Care..


Legacy CareLegacy Care As The As The Designated FundDesignated Fund

High issue age.High issue age.–– Through age 99.Through age 99.

FiveFive--year surrender schedule.year surrender schedule.

A benefit increase rider that can make the transfer to A benefit increase rider that can make the transfer to ImmediateCare ImmediateCare (with its lifetime income for LTC (with its lifetime income for LTC expenses) that much more attractive if LTC is needed in expenses) that much more attractive if LTC is needed in the future.*the future.*

Bailout provision.Bailout provision.–– To provide flexibility should the interest rate decline.To provide flexibility should the interest rate decline.

*Please review the *Please review the Legacy CareLegacy Care Producer’s Guide (part no. 35512) for details about this Producer’s Guide (part no. 35512) for details about this provision.provision.


Legacy CareLegacy CareMaximizing available funds, should LTC be Maximizing available funds, should LTC be needed.needed.Access to Access to ImmediateCareImmediateCare to help pay for to help pay for LTC expenses.LTC expenses.Conservative growth with a minimum Conservative growth with a minimum credited interest rate and bailout interest credited interest rate and bailout interest rate.rate.Still your client’s asset, should LTC never Still your client’s asset, should LTC never occur.occur.


SummarySummaryKeep an eye out for a followKeep an eye out for a follow--up eup e--mail from us with further information and a mail from us with further information and a

quote request form attached!quote request form attached!

The example cases herein are hypothetical and designed for educational purposes. See product brochures and illustrations for coverage details and other information. Premiums and benefits vary by age and other factors.

Policy Forms: Asset-Care: GRI-L-20.1, -22.1, -32, -33, -40, -41, -42, -43, -50, -51, -52, -53, -60, -61, -62, -63.; GRI-AN-4N, -4Q; SA-S-574, -574R; Annuity Care: GRI-AN-6, -6.762, -6.763; SA-S-762, -763, -882; Legacy Care: GRI-AN-23; SA-S-1275, -1276; ImmediateCare: GRI-AN-19: Or state variation. All policies are not available in all states. Policies are medically underwritten (except Legacy Care) and issued by Golden Rule Insurance Company, Indianapolis, Indiana.

Copyright © 2005 Golden Rule Insurance Company

a sset-based ltc - long term care insurance information ... · -care ®: life insurance--based...

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