Assurity Life s Critical Illness Insurance, NonMed Term 350, and Simplified Whole Life Insurance Products. USBI# A (Rev.

Transcription

1 Assurity Life s Critical Illness Insurance, NonMed Term 350, and Simplified Whole Life Insurance Products USBI# A (Rev. 12/13)

2 Critical Illness Why Critical Illness Insurance What is Critical Illness Insurance Expense of a Heart Attack Portfolio Turmoil How to access Critical Illness Coverage 2

3 Why Critical Illness You need Critical Illness insurance not because you are going to die, but because you are going to survive. Dr. Marius Barnard 3

4 What is Critical Illness Insurance Coverage that provides a lump sum cash payment Helps cover costs of care and treatment Hospital expenses After Care expenses Benefits of Critical Illness Insurance can help: Replace lost income Provide financial protection Offset gaps in income due to waiting periods 4

5 Expense of a Heart Attack The most important thing to protect yourself is make sure that you have adequate Health Insurance Coverage. Paul A. Heidenreich, MD Associate Professor of Medicine Stanford University Average cost* of a severe heart attack $ 1,000,000 a less severe heart attack $ 760,000 * National Business Group on Health,

6 Detailed Expenses Consider this hypothetical example of expenses: Ambulance and Emergency Room Ambulance Expense (range $800 to 1,500) $ 800 Medical Support in Ambulance $ 100 ER $ 250 Labs $ 500 EKG $ 300 Miscellaneous (x-ray, drugs, etc.) $ 500 $ 2,450 ICU Care (assume five days) $ 10,000 $ 50,000 $ 52,450 Major Hospital Heart Center (including surgeon fees - range $22,000 to $25,000) $ 25,000 (not including surgeon fees - range $5,000 to $15,000) $ 15,000 $ 92,450 Insurance Deductible $ (7,500) $ 84,950 20% Co-pay $ (16,990) $ 67,960 Total Out-Of-Pocket $ 24,490 6

7 Portfolio Turmoil What is the potential impact when liquidations are occurring during the accumulation phase of a retirement plan? Which assets will be liquidated first? Is there a impact to taxation? Premature penalties? Will your client increase retirement funding when they are able to return to work? If not, what is the impact? During disability no contributions to qualified plans 7

8 Options Two ways to earmark for this: 1) Block off a big health care emergency fund and use the balance to live on and for travel, entertainment and the things you have earned 2) Block off a small monthly amount for health care insurance and use the bigger balance to live on and for travel, entertainment and the things you have earned 8

9 How to access Critical Illness Coverage Assurity s Critical Illness Insurance Two product options: Simplified Critical Illness Fully Underwritten Critical Illness U.S. Bancorp Investments is not affiliated with Assurity Life Insurance Company. Critical Illness products underwritten by Assurity Life Insurance Company, Lincoln, Nebraska. 9

10 Simplified Critical Illness Basics Issue ages: 18 to 64* $5,000 to $50,000 in benefits available 12 conditions covered Guaranteed renewable to age 75 Riders include: Return of Premium Rider Disability Waiver of Premium Rider Accidental Death Benefit Rider Spouse Critical Illness Benefits Rider Children s Critical Illness Benefits Rider * To age 59 in some states. Policy form I H0810 or CI 005 Product availability, rates and features may vary by state. (R 9/12) Guarantees are backed by the claims paying ability of Assurity Life Insurance Company. 10

11 Simplified Critical Illness Basics 12 Covered Conditions The policy pays up to 100% from each category and when 100% from a category has been disbursed, that category closes, and benefits from that category are no longer available. 11

12 Suitability Who is a suitable candidate for simplified critical illness? Anyone who is not on Medicaid or Medicare. Anyone who has not been postponed or declined for CI coverage Anyone who does not plan to live or travel outside the U.S. and Canada for more than 2 months during the next 2 years. Anyone who can answer no to all questions in the Section 5 Health Section of the application In CA, MN and NJ must own major medical insurance Residents of NY are not eligible for any Assurity product 12

13 Fully Underwritten Critical Illness Basics Issue ages: 18 to 64 $50,000 to $500,000 in benefits available 21 conditions covered Guaranteed renewable for life Riders include: Disability Waiver of Premium Rider Accidental Death Benefit Rider Spouse Critical Illness Benefits Rider Children s Critical Illness Benefits Rider Policy form I H0820 or CI 007 Product availability, rates and features may vary by state. 13

14 Fully Underwritten Critical Illness Basics 21 Covered Conditions The policy pays up to 100% from each category and when 100% from a category has been disbursed, that category closes, and benefits from that category are no longer available. 14

15 Critical Illness Underwriting Simplified Critical Illness Short application Accept/reject 4-day service guarantee E-application available Fully Underwritten Critical Illness Similar to preferred life underwriting E-application now available 15

16 Suitability Who is a suitable candidate for fully underwritten critical illness? Anyone who is not on Medicaid or Medicare. Must meet Assurity s age, weight and height guidelines. This product requires traditional underwriting. All applicants are subject to individual underwriting approval by Assurity. In CA, MN, and NJ must also have major medical insurance Anyone who does not plan to live or travel outside the U.S. and Canada for more than 2 months during the next 2 years. Residents of NY are not eligible for any Assurity product 16

17 Suitability Critical Illness coverage is not meant to replace major medical insurance. 17

18 Summary The High Cost of Health Care Health Care may be one of the greatest expenses in retirement. Critical Illness coverage can help provide the flexibility to: Pay off debt Cover unexpected medical expenses Protect retirement assets from early liquidations 18

19 Financial Professional Responsibilities Limitations of Authority DO NOT: Accept risk on behalf of Assurity. Promise reinstatement of coverage. Waive or alter policy terms. Extend credit to applicants/insureds. Collect any premium other than the first. Deliver a policy when you know an impairment of health is not disclosed on the application or occurred after the application was taken. 19

20 Financial Professional Responsibilities Duties: You must comply with Assurity s, as well as USBI s rules about replacements: Replacement is: Whenever an existing policy or contract is terminated, converted or otherwise changed in value to add another policy to the customer s portfolio. Recommend the replacement only when replacement is suitable for the customer. Factors to consider with your client: The financial impact to the customer of the replacement, whether a new contestability period and/or suicide clause will start under the new policy (if applicable); and whether the customer will have to resubmit to underwriting to buy the new policy. Never recommend that a customer cancel an existing policy until a new policy is in force, and the customer has determined the new policy is acceptable. 20

21 Financial Professional Responsibilities Duties: You may collect the first premium only. You must maintain a current license and valid appointment in all states in which you are selling. You must submit all customer complaints to USBI Compliance promptly. Submit all advertising materials to USBI Product Management and USBI Compliance for approval prior to use. 21

22 What is NonMed Term 350? Issue ages (10- & 15-year plan) (20-year) (30-year) Face amounts: $50,000-$350,000 Non medical Underwriting App, MVR, MIB, Script Check NOT an accept/reject product; three underwriting classes Convertable to Assurity Permanent Life Products Policy form I L0760. Product and rider availability, rates and features may vary by state.

23 Optional riders Disability Waiver of Premium Rider Monthly Disability Rider Two-year benefit; 90-day elimination; simplified underwriting (1.5% of face amount up to $3,000 maximum) Accident Only Disability Rider Children s Term Insurance Rider Critical Illness Rider $20,000-$100,000 lump-sum benefit Assurity three-category approach Return of Premium Rider Available for 20- & 30-year plans Other Insured Rider

24 Underwriting Process App Home Office Decision Automated Underwriting Application Agent takes an application (paper or electronic) and submits it to Assurity. Automated Underwriting Information is put into our automated system to check MIB, Script check and MVR. Decision Decision is rendered from the black box (approval or decline) or kicked out to an underwriter for review if we need additional information. Additional Information If we need additional information, the underwriter may request a telephone interview or order medical records. Decision Based on information received, a final decision will be made.

25 What is Term 350 Plus? Term Periods: 10, 15, 20, 30 years Issue Ages: 10-yr: Ages 18 thru 74 non-tobacco; ages 18 thru 70 tobacco 15-yr: Ages 18 thru yr: Ages 18 thru yr: Ages 18 thru 50 non-tobacco; ages 18 thru 45 tobacco Issue Amounts: $350,001 and up (Ages are $100,001 and up) Underwriting Classes: Preferred+ non-tobacco Preferred non-tobacco/tobacco Standard non-tobacco/tobacco Policy form I L0760.

26 Optional riders Disability Waiver of Premium Rider Other Insured Rider Monthly Disability Income Rider Accident Only Disability Income Rider Children s Term Insurance Rider Return of Premium Rider (available on 20- and 30-year plans of base policy, Waiver of Premium Rider and ROP Rider only) Critical Illness Rider

27 Suitability Who is a suitable candidate for NonMed Term 350/ Term 350+? Must meet Assurity s age, weight and height guidelines. These products require traditional underwriting. All applicants are subject to individual underwriting approval by Assurity Anyone who does not plan to live or travel outside the U.S. and Canada for more than 2 months during the next 2 years. Residents of NY are not eligible for any Assurity product

28 What is Simplified Whole Life? Non-participating whole life insurance with simplified underwriting Level and guaranteed premiums Simplified underwriting no medical exams or fluids Application Applicant information covered in 1½ pages; 10 yes/no health questions; E-app Plan options: Level Benefit for no health issues Graded Benefit for some health issues Modified Benefit for more significant health issues Policy forms I L601, I L602, I L603.

29 Simplified Process 10 Health Question Application Phone Interview for applicants over Preapproval over the phone in most cases No paramed, blood draw, or urinalysis Qualifies for the Assurity Advantage Policy forms I L601, I L602, I L603 Products availability and features may vary by state

30 Simplified Life Basics What is the Best Plan for My Client? App Section A Questions Answer any Yes REJECT Answer all No App Section B Questions Answer any Yes MODIFIED Answer all No App Section C Questions Answer any Yes GRADED Answer all No LEVEL

31 The Ideal Client Clients planning for Final Expense average cost of a funeral is $7,755 Clients with medical conditions limiting ability to obtain coverage Clients with modest insurance needs where fully underwritten unavailable Clients looking for simple, permanent life insurance solution Policy forms I L601, I L602, I L603 Products availability and features may vary by state

32 Suitability Who is a suitable candidate for Simplified Whole Life? Anyone who has not been charged with or convicted of a felony in the past two years. Anyone who can answer no to all 6 questions in Portion A of Section 6 Health Section of the application For the Graded Death Benefit Plan can answer no to Question 7 in Portion B of Section 6 Health Section of the application For the Level Death Benefit Plan can answer no to Questions 8 through 10 in Portion C of Section 6 Health Section of the application Anyone who does not plan to live or travel outside the U.S. and Canada for more than 2 months during the next 2 years. Residents of NY are not eligible for any Assurity product

33 Disclaimer Investment products and services are available through U.S. Bancorp Investments, the marketing name for U.S. Bancorp Investments, Inc., member FINRA and SIPC, an investment adviser and a brokerage subsidiary of U.S. Bancorp and affiliate of U.S. Bank. Insurance products are available through various affiliated non-bank insurance agencies, which are U.S. Bancorp subsidiaries. Products may not be available in all states. CA Insurance License# OE Policies are underwritten by unaffiliated insurance companies and may not be available in all states. Policy rates and features may vary by state. Clients should consult with their tax advisor regarding taxrelated issues. Guarantees are backed by the claims-paying ability of the issuing insurance company, Assurity Life Insurance Company. U.S. Bancorp Investments is not affiliated with the entities named with this publication. This is for the information of Financial Advisors only, and may not be reproduced, shown to members of the public or used as sales literature. This information does not satisfy a Representative s obligation to assess the suitability of a particular investment for a particular investor. Financial Advisors are reminded of their obligation to have a fair and balanced conversation with the client, including both the benefits and downsides of an investment recommendation. 33 USBI#