Senior Market Products

Annuities

An Annuity is a contract which makes payments to you at regular intervals based on premiums that you pay for the contract.  The main reason to buy an annuity contract is to obtain an income, usually for retirement purposes.  You can buy annuity contracts from life insurance and other financial services companies.  Annuity income payments are often made monthly, although other frequencies are available.  An annuity contract is not a life insurance policy or a health insurance policy.  It is not a savings account or savings certificate, nor should it be bought for short-term purposes.

All annuities have three primary advantages: Tax Deferral, Avoidance of Probate, and a Guaranteed Income (optional) for a fixed period of time, or income for life.
More specific reasons to invest in fixed and immediate annuities:

• You need to safely create wealth for your heirs
• You need tax-deferred growth
• You need your principal and interest guaranteed
• You need your heirs to avoid probate upon your death
• You need an increased death benefit
• You need stock-market linked gains without the downside risk
• You have money that is designated for inheritance
• You do not need more than 10% liquidity annually

Long-Term Care Insurance

Long-Term Care is the type of care received either at home or in a facility, when someone needs assistance with activities of daily living, such as bathing, toileting, continence, dressing, eating, and transferring or when you need substantial supervision due to cognitive impairment.

Long Term typically refers to skilled, intermediate, and custodial care received at home or in an adult day care center, assisted living facility, or nursing facility.  No matter how well off you are financially, the cost of long term care could severely impact your life's savings.  It can also help you retain your independence, even if an accident or illness takes away your ability to care for yourself.  People who need care overwhelmingly prefer to receive care in their homes, where they are comfortable and supported by friends and family.

Rising life expectancy means that the potential need for "long-term care" grows with every passing year of your life.  The likelihood is that you or a member of your family will need long-term assistance due to a prolonged illness, a disability, or general deterioration of your health and ability to perform routine daily activities.  Most long term care expenses are not covered by Social Security or Medicare, Medicare Supplement ("Medigap"), or private health insurance.  Medicaid pays for nearly half of all nursing home care, but you must meet federal poverty guidelines and may have to "spend down" most of your assets on health care. The national average cost of a semi-private room in a nursing home is now $70,000 annually.  By 2030, the average annual cost of nursing home care is expected to exceed $190,000 per year; in most cases, health and disability insurance cover only a fraction of Long Term Care costs.

If you want access to the highest quality of care and don't want to trade the wealth you've accumulated over a lifetime to pay for your care, you need LTC insurance.  Remember, too, that the need for LTC can happen to anyone, even in the prime of life.  And the cost of purchasing LTC insurance is substantially reduced when you purchase it while you're young.

Life Insurance

Term Life Insurance

Term life insurance is life insurance that you pay for over a specified length of time, or term - generally one to 30 years. The amount of the death benefit or face value can be selected to meet your needs.  Premiums, or payments - which can be the same amount or increase over time - must be made monthly, quarterly, semi-annually, or annually.  If you die during the term of coverage, the face amount of your policy will be paid to your beneficiaries.  Term insurance policies do not accumulate cash value and usually offer lower premiums than other life insurance products with the same face value.

Universal Life Insurance

Universal life is permanent insurance, which has the potential to accumulate cash value.  However, it offers additional features and options as well.  For example, you can increase or decrease your policy's face amount to accommodate your changing protection needs.  You can also increase or decrease the dollar amount of your premium payments and make additional lump sum payments to your policy.  And because a Universal Life policy accrues cash value, you can borrow against for any purpose. You have the option to skip premium payments, which you can do if your account has accrued sufficient value. A UL policy also has the potential to earn a higher rate of return than a whole life policy, even though there's a risk that your rate of return could drop.

Whole Life Insurance

Whole Life Insurance is life insurance that you own for your entire lifetime.  The amount of the death benefit or face value can be selected to meet your needs.  Premiums, or payments, are fixed and can be paid monthly, quarterly, semi-annually, or annually.  As more premiums are paid, your policy accumulates a cash value, which grows on a tax differed basis.  In essence, whole life is like buying a house versus renting it. The monthly cost is higher than it would be for a term life policy, but with each payment you make, you gain "equity."  You can borrow against a Whole Life policy for any purpose.  Loans, however, require you to pay interest and any borrowed amount you do not pay back is deducted from the payout to your beneficiary at the time of your death.

Final Expense Insurance

Your family means the world to you.  The last thing you want is to leave them with major expenses after you’re gone.  Final Expense insurance is life insurance that can help provide the money you need to pay medical bills, funeral expenses, legal fees or unpaid bills.  It is an insurance plan that lets you decide how your assets are distributed.  By planning ahead, you can protect your loved ones from unnecessary financial and emotional stress when you die or enter a qualified nursing home.  And you can distribute your assets in the manner you decide!

Medicare Insurance

Eligibility

In general, individuals are eligible for Medicare if they (or their spouse) worked for at least 10 years in Medicare-covered employment and are at least 65 years old and are a citizen or permanent resident of the United States of America.

Individuals who are under 65 years old can also be eligible if they are disabled or have end stage renal disease.  People under 65 and disabled must be receiving disability benefits from either Social Security or the Railroad Retirement Board for at least 24 months before Medicare automatic enrollment occurs.

Many beneficiaries are dual-eligible.  This means they qualify for both Medicare and Medicaid.  In some states those with certain income, Medicaid will pay the beneficiaries Part B premium for them (most beneficiaries have worked long enough and have no Part A premium), and also pay any drugs that are not covered by Part D.

Part A: Hospital Insurance

Part A covers hospital stays (including stays in a skilled nursing facility) if certain criteria are met:

• The hospital stay must be at least three days, three midnights, not counting the discharge date.
• The nursing home stay must be for something diagnosed during the hospital stay or for the main cause of hospital stay.  For instance, hospital stay for broken hip and then nursing home stay for physical therapy would be covered.
• If the patient is not receiving rehabilitation but has some other ailment that requires skilled nursing supervision then the nursing home stay would be covered.
• The care being rendered by the nursing home must be skilled.  Medicare part A does not pay for custodial, non-skilled, or long-term care activities, including activities of daily living (ADLs) such as personal hygiene, cooking, cleaning, etc.
• The maximum length of stay that Medicare Part A will cover in a skilled nursing facility per ailment is 100 days. The first 20 days would be paid for in full by Medicare with the remaining 80 days requiring a co-payment (as of 2008, $128.00 per day). Many insurance companies have a provision for skilled nursing care in the policies they sell.
• If a beneficiary uses some portion of their Part A benefit and then goes at least 60 days without receiving skilled services, the 100-day clock is reset and the person qualifies for a new 100-day benefit period.

Part B: Medical Insurance

• Part B medical insurance helps pay for some services and products not covered by Part A, generally on an outpatient basis.  Part B is optional and may be deferred if the beneficiary or their spouse is still actively working.  There is a lifetime penalty (10% per year) imposed for not taking Part B if not actively working.
• Part B coverage includes physician and nursing services, x-rays, laboratory and diagnostic tests, influenza and pneumonia vaccinations, blood transfusions, renal dialysis, outpatient hospital procedures, limited ambulance transportation, Immunosuppressive drugs for organ transplant recipients, chemotherapy, hormonal treatments such as lupron, and other outpatient medical treatments administered in a doctor's office.  Medication administration is covered under Part B only if it is administered by the physician during an office visit.
• Part B also helps with durable medical equipment (DME), including canes, walkers, wheelchairs, and mobility scooters for those with mobility impairments.  Prosthetic devices such as artificial limbs and breast prosthesis following mastectomy, as well as one pair of eyeglasses following cataract surgery, and oxygen for home use is also covered.
• As with all Medicare benefits, Part B coverage is subject to medical necessity.  Complex rules are used to manage the benefit, and advisories are periodically issued which describe coverage criteria.  On the national level these advisories are issued by CMS, and are known as National Coverage Determinations (NCD).  Local Coverage Determinations (LCD) only apply within the multi-state area managed by a specific regional Medicare Part B contractor, and Local Medical Review Policies (LMRP) were superseded by LCDs in 2003.

Part C: Medicare Advantage Plans

Please refer to the Centers for Medicare and Medicaid Services Booklet: Medicare and You 2008 for a complete outline of the Medicare Advantage Program.

Part D: Prescription Drug Plans

Medicare Part D went into effect on January 1, 2006. Anyone with Part A or B is eligible for Part D. It was made possible by the passage of the Medicare Prescription Drug, Improvement, and Modernization Act. In order to receive this benefit, a person with Medicare must enroll in a stand-alone Prescription Drug Plan (PDP) or Medicare Advantage plan with prescription drug coverage (MA-PD).  These plans are approved and regulated by the Medicare program, but are actually designed and administered by private health insurance companies.  Unlike Original Medicare (Part A and B), Part D coverage is not standardized.  Plans choose which drugs (or even classes of drugs) they wish to cover, at what level (or tier) they wish to cover it, and are free to choose not to cover some drugs at all.  The exception to this is drugs that Medicare specifically excludes from coverage, including but not limited to benzodiazepines, cough suppressant and barbiturates.   Plans that cover excluded drugs are not allowed to pass those costs on to Medicare, and plans are required to repay CMS if they are found to have billed Medicare in these cases.
 
It should be noted again for beneficiaries who are dual-eligible (Medicare and Medicaid eligible) Medicaid will pay for drugs not covered by part D of Medicare, such as benzodiazepines, and other restricted controlled substances.

Medigap (Supplemental Insurance) Policies
A Medigap policy is health insurance sold by private insurance companies to fill the “gaps” in Original Medicare Plan coverage.  Medigap policies help pay some of the health care costs that the Original Medicare Plan doesn’t cover.  If you are in the Original Medicare Plan and have a Medigap policy, then Medicare and your Medigap policy will pay both their shares of covered health care costs.

Insurance companies can only sell you a “standardized” Medigap policy.  These Medigap policies must all have specific benefits so you can compare them easily.

You may be able to choose up to 12 different standardized Medigap policies (Medigap Plans A through L).  Medigap policies must follow Federal and State laws.  These laws protect you.  A Medigap policy must be clearly identified on the cover as “Medicare Supplement Insurance.”  Each plan, A through L, has a different set of basic and extra benefits.
It’s important to compare Medigap policies because costs can vary.  The benefits in any Medigap Plan A through L are the same for any insurance company.  Each insurance company decides which Medigap policies it wants to sell.

Generally, when you buy a Medigap policy you must have Medicare Part A and Part B.  You will have to pay the monthly Medicare Part B premium.  In addition, you will have to pay a premium to the Medigap insurance company.

You and your spouse must each buy separate Medigap policies.  Your Medigap policy won’t cover any health care costs for your spouse.