Level term policy to age 120?

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PostPosted: Thu Jul 30, 2009 1:47 pm   Post subject: Level term policy to age 120?  

87 year old male looking to move 200k from cd's to something that would protect the money from medicaid immediately. Fellow agents, I heard about a single premium level term to age 120 basically for medicaid avoidance. It was a dollar for dollar policy with issue age up to 90 I believe anyone know this product and carrier

Joshua
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PostPosted: Fri Jul 31, 2009 4:15 am   Post subject:   

I would be surprised if any insurance company agrees to take the risk of insuring 87 years old. I am almost sure that no level term policy would be available to him.



What rate of premium are they charging to insure one at this age?



Hopefully life agents of this board would be able to throw some light upon this.

simon
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PostPosted: Fri Jul 31, 2009 12:23 pm   Post subject:   

A $200k single premium policy guaranteed to age 120 would only buy approximately $235k in death benefit if the 87-year-old is in reasonable health. I'm not sure what company would offer a dollar-for-dollar match on death benefit. That's a losing proposition for the insurance company.

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PostPosted: Fri Jul 31, 2009 12:56 pm   Post subject:   

Quote:
A $200k single premium policy guaranteed to age 120 would only buy approximately $235k in death benefit if the 87-year-old is in reasonable health. I'm not sure what company would offer a dollar-for-dollar match on death benefit. That's a losing proposition for the insurance company.




Why would it be a losing proposition for the insurance company? A $200k premium would buy a $200K death benefit. The insurance company is collecting $200K today in exchange for paying $200K in the future. That sounds like a winning proposition.



Is the policy that you are quoting a UL policy? If so, is there any cash value? If so, it doesn't solve the problem.



Joshua, I don't know anything about the product that you are describing. Assuming that it exists, I'd be concerned about the Medicaid recapture rules.



Additionally, will Medicaid give him the care that he wants? Might it make more sense to use the cash so that he can get the type of care that he wants?
InsuranceExpert
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PostPosted: Fri Jul 31, 2009 2:10 pm   Post subject:   

I read it as being a dollar-for-dollar match on the single premium (i.e. $400k benefit on $200k lump sum), my mistake. I would also question why anyone would want to be in a Medicaid facility vs. paying your own way with that $200k.....but we really don't know the whole story here.

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PostPosted: Thu Aug 06, 2009 5:03 am   Post subject:   

You might be thinking of some of the guaranteed UL policies. The have almost no cash value and look almost like a term policy that goes to age 120+.



Some of the main players dropped out of the marketplace. Genworth has a nice product, but their ratings aren't that great now. Not sure who has the single premium option.



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PostPosted: Thu Aug 06, 2009 5:01 pm   Post subject:   

Yes, there is a carrier that I have heard of doing this. It is a SPWL, but it is medicaid exempt.



If you have any problems, let me know. They aren't approved in all states.



www.elcoins.com



Feel free to contact me at: brad [at] brookfieldpartners.com

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PostPosted: Fri Aug 07, 2009 2:03 pm   Post subject:   

The only way that I can think of that would make this Medicaid exempt is if somehow there was no cash surrender value. Even so, I would worry about Medicaid recovery depending on the state. I think that we'll see more and more of this in the future. I'm talking about Medicaid coming after the money after death to get reimbursed.

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