Life Insurance for People with Disabilities

Did you know that the Council of Disability Awareness reports that there are currently over 36 million Americans who are considered as disabled?

That works out to 12% of the population.

Did you also know that 1 out of 4 people who are currently in their twenties will become disabled before they retire?

And finally, of those people who are currently disabled, 50% are still in their working years and between18 – 64 years of age.

Unless you already were born with a disability or already have a disability, you probably most likely think that it won’t happen to you.

Life is uncertain and there are no guarantees. So, if you are already disabled, then you might be wondering if you are still eligible for life insurance.

Life Insurance and the Legal Rights of the Disabled

Americans who have a disability have legal protection which prevents a life insurance company from refusing coverage simply because of their disability.  These rights are protected under the American with Disabilities Act.  At least that’s the way it’s supposed to work.

Nonetheless, there are many people with a disability who find it a challenge to buy affordable life insurance or even to get any at all.

How Life Insurance View the Disabled

A person with a disability generally has a medical condition caused by disease or injury which physically restricts or limits them from performing some or even all of their daily activities.  A disability can be caused at birth from a genetic disorder, or something which manifests itself over time, or is caused by something they have contracted.

A disability can be a result of an accident or injury which was work related, or caused by just about anything you can imagine.  Many people function relatively well with a disability while others require a lot of additional care to help them cope with performing their daily activities which most of us take for granted.

The first thing you should know is that not all disabilities are the same.  And, not all life insurance companies view similar disabilities the same.  One of the key factors that a life insurance company will look at is to determine if they believe that your particular type of disability will shorten your life span.

If the insurance carrier underwriter’s believe or determine that your particular disability will reduce your expected life span then you will receive a lower rating and they will charge more for a premium.

Additional factors also come into play when making this determination such as your age, and additional health factors such as if you also have heart disease, high blood pressure and cholesterol, and your lifestyle. continue page 2……

The Tax Benefits of Life Insurance

Did you know that life insurance proceeds are not taxable?

For the most part, and there are a few exceptions, your beneficiary will not have to pay income tax on the death benefits they receive.

This applies to both term and permanent life insurance policies.

In the majority of cases, a named beneficiary will receive the death benefits as a lump sum payment and these proceeds are not subject to income tax.  Your beneficiaries can use the life insurance proceeds immediately and in any manner or purpose they choose.

There are a few situations where life insurance proceeds can be taxable and I explain later where you might get dinged by the IRS if you make a mistake.  However, I’ll tell you how you can avoid making these mistakes.

Naming your Beneficiary

This is one of the most important things you need to think about when you buy a life insurance policy.  When you decide on the person or persons, as you can name more than one beneficiary, you should do the following:

  • Give Full Names – Provide the full names of the person(s) as the beneficiary.  It’s also a good idea to specify their birthdates or Social Security Number to clarify their identity.  This is just in case there are other family members who happen to have the same name.  This will avoid potential legal complications if 2 people with the same name challenge the payment of the death benefits.
  • Spouse and Relatives – If you are naming your spouse, then make sure you clarify the name of the spouse and do not simply put a generic reference such as ‘spouse’.   The same should apply to siblings such as brother or sister.  People divorce and re-marry and sometimes neglect to alter the beneficiaries on their life insurance policies.  I can guarantee that this can result in legal complications. Be specific!
  • Estate – Do not name your beneficiary as your ‘estate’, unless you intentionally mean to do so.  This should really never, ever be done on a term life insurance policy and especially if you do not have a will.  If you name your estate as beneficiary, then the proceeds could end up in probate and the proceeds could be subject to estate taxes at both the federal and state levels.
  • Third Party Purchases – Beware of purchasing life insurance as a third party.  This is a common situation which happens when a parent buys a life insurance policy for one of their children, who happens to be grown up and already married, who then designates their spouse as the beneficiary.  The parent is the owner of the policy, while the child is the insured and their spouse is the beneficiary.  Should the child die, then it is very possible the IRS may view the life insurance proceeds which the spouse receives as a gift from the parent who purchased the policy and who is the owner of the policy, but not the named insured.

Tax Benefits of Permanent Life Insurance Policies

Permanent life insurance policies such as whole life, universal life and variable life are a little bit more complicated because of the cash value accumulation feature which is not found in term life insurance policies.

Permanent life policies consist of two parts which includes both death benefits and the cash value accumulation feature.

Now, in some instances, some people will deliberately name the beneficiary on their policies as their ‘estate’.  This is fine if they meant to do so and it is done so on the advice of their tax advisor or financial advisor.  The same applies to situations where you are setting up a trust but this should only be done with the advice of a tax consultant or financial advisor.

You cannot and should not name your ‘estate’ as beneficiary if you do not have a will as the both the proceeds from the death benefits and the cash value accumulation will end up in probate, and could be subject to having to pay estate taxes to both the federal and state governments.

Other Taxable Benefits of Permanent Insurance

Permanent life insurance policies come with a cash value accumulation feature.  On a whole life and universal policy, the cash value is generally guaranteed to grow at a minimum amount of interest.  The interest you earn in the cash value accumulation portion of your policy is also not taxable.  You do not have to pay taxes on the interest or on the proceeds payable to your beneficiary.

Variable life insurance policies allow you to make investment choices as you can opt to have you money invested in bonds, stocks or a money market fund.  If you were to invest on your own, you would be subject to capital gains, but this does apply to the money invested in a variable life insurance policy.

(Disclaimer – There are tax pitfalls that you have to be careful about when it comes to buying life insurance.  It is always best to talk to tax consultant or your financial advisor so you aware of any potential problems which might arise).

Need More Information?

You always want to talk to an independent agent like myself.  We can access and research dozens of companies so you are assured we will find the best policy at the most affordable rates.  If you have health concerns, don’t let that dissuade you because we can give you valuable advice and help you to find a policy that suits you.

Whatever your needs or questions then please call me direct at 877 – 966 – 9383.

Life Insurance Approval with Sickle Cell or Sickle Cell Anemia

sickle cell anemiaIf you’ve been turned down for life insurance due to sickle cell anemia or sickle cell, there is hope.  We represent some carriers who will offer affordable coverage to certain individuals, depending on age of diagnosis, history of complications, and they type of sickle cell you have.

As medications and treatment plans have improved recently, individuals with sickle cell or SS now have markedly better life expectancies into their 60’s and beyond.

Best Case Scenario – Sickle Cell Trait or Sickle Cell

With merely the trait, no penalty will be applied to your health classification.  You can qualify for preferred rates, in fact.  If you have sickle cell (SC), and you have a mild to moderate case, you may only get a mild substandard rating.  To get an idea of the premium you’ll pay, just run some quotes at Standard class and add approximately 50% to the premium.  Not too bad.

Mild to moderate sickle cell would be defined as current Hb readings 10 or more, and HCT more than 32%, with only mild history of complications.  Severe cases will be declined for traditional types of insurance, but policies with graded death benefits may be available.

As you know, some complications of sickle cell disease may be painful crises, lung scarring, thrombosis, necrosis of the bones, and leg ulcers.  Obviously, the absence or minimization of these affects will increase your odds of approval.

In a best case scenario, if there is no evidence of any history of anemia or crises, you could qualify for the best preferred classes.

Sickle Cell Anemia (SS)

With sickle cell anemia, and we’re talking adults here (as children under 15 will be declined due to elevated risk), again, it will depend on your Hb and HCT levels being high enough.  If they are, you’re looking at a substandard case, such as Table D.

If you would like a personalized quote, it will be important for us to collect information on the history of your painful crises.  Although almost everyone with SS or SC has experienced a painful crisis, the severity and frequency varies greatly among patients.  Some individuals can go years without experiencing an episode.

Your best scenario is it’s been more than a year since your last episode, and if your symptoms have never been so severe as to land you in the hospital.

After Bone Barrow Transplant

You still may be able to qualify for life insurance if you’ve needed a bone marrow transplant or stem cell transplant in the past to control your sickle cell anemia.  In fact, you can be a mildly substandard case as early as 6 years post treatment, assuming no complications and Hb consistently over 10.

Other Medical Conditions

Obviously, the presence of other health issue presents a problem.  Just because you may qualify for, say, a Standard rate with controlled sickle cell disease, does not mean you will still qualify for Standard if you’ve also had a history of heart disease or obesity, for example.

Since smoking is so bad for people with sickle cell, it will be nearly impossible for you to be approved if you also smoke, so don’t do it!

Controlling the Complications

Your goal as someone who suffers from SS or SC, and who wants life insurance, should be to be compliant with every recommendation your doctor makes.  If you are supposed to drink 8 glasses of water every day, and take Hydrea, antibiotics, or whatever else is prescribed to you, a life insurance underwriter is going to want to see that your medical records reflect you are following those orders to the tee.

For a personalized quote with sickle cell disease or any other impaired risk case, please call us at 877-996-9383.  If you liked this post, please like it on Facebook or share it on Google +1.  Thank you!

Life Insurance Approval with Congestive Heart Failure

If you go to your run of the mill agency like State Farm or Farmers Insurance, you won’t have a chance at being approved for life insurance with congestive heart failure.  We have, however, obtained many successful approvals with this heart condition and many other types of impaired risk cases.

Two Types of Approval

An individual with congestive heart failure may qualify for two types of insurance:  traditional life insurance or graded death benefit life insurance.  Traditional coverage will require a medical exam and is usually much less expensive.  You will need to be in better health to qualify for this type.

The key to a traditional policy approval will be a recent echocardiogram, treadmill stress test, or cardiac catheterization showing that the heart is not overly enlarged, and the left ventricular ejection fraction (LVEF) is still within acceptable levels.

The ejection fraction measures how efficiently the left ventricle pumps the blood.  Normal is around 50% to 60%.  But in people with heart failure, the ejection fraction drops, sometimes into the 40’s, 30’s or even 20’s.  It will need to be in the 40’s to have a chance at a traditional policy.

Your odds are also better of being approved if you are a non smoker, at a good weight, with no other health issues, such as diabetes.  The insurance carriers will expect that you will be on medication to control your blood pressure, so that’s okay.

Graded Death Benefit

If your heart failure is in later stages, your ejection fraction may be lower than this, and your only option will be to apply for a graded death benefit type of policy.

This type of life insurance is far easier to qualify for.  As long as you haven’t been confined to a nursing home or had a heart attack or transplant in the past 2 years, or currently hospitalized, you can potentially qualify for this coverage.  There are other qualifying questions related to other medical conditions, but those are the only conditions as it relates to your heart.

A graded death benefit policy works a bit differently than traditional, in that you don’t need to have a medical exam, and they won’t order your medical records, so it’s much quicker.  However, it is also more expensive than the traditional variety.

The term “graded death benefit” is also very important.  It means your death benefit is reduced during the first 2 years of the policy.  For example, if you have a policy with a $50,000 death benefit, the benefit might only be $5,000 in the first year, $10,000 in the second year, and then $50,000 thereafter.  The most popular and reputable company offering graded death benefit life insurance is Fidelity Life Association.

Types of Life Insurance Offered by Fidelity

One of the nice things working with Fidelity’s impaired risk products is they have their graded policy, which is a whole life policy, which builds cash value.  But what is unique is they also offer a lower cost type of insurance called term, which keeps the premiums fixed for the duration of the term.  For example, they offer 10 year term, 20 and 30 year term policy, which also has the first 2 years as a graded benefit.

To get started with a life insurance quote with congestive heart failure, simply fill out our quote form on the right, and tell the representative who contacts you about your entire health history.

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Life Insurance Approval after Heart Transplant

Heart Transplant Life InsuranceIf you’ve had a heart transplant, and have been shopping for affordable life insurance, you’ve probably found that your options are quite limited.

In most cases, all your traditional life insurance companies will decline your case as if you’re terminally ill.  It is truly unfair, considering that 50% of heart transplant recipients live more than 10 years after the surgery.  In recipients who live at least one year after the surgery, the prognosis is even better.

Our Insurance Solution for Heart Transplant Survivors

We have affordable options for heart transplant survivors, who have had the surgery more than two years ago.  Yes, it’s okay if you’re on the immunosuppressants, such as Rapamune.  This is expected.

As long as you can answer the following questions no, coverage is available in most states:

1. In the past 2 years, have you had a heart attack or stroke?

2. In the past 2 years, have you had or are you now awaiting an organ or bone marrow transplant?

3. In the past 2 years, have you been advised by a licensed medical professional to be admitted to a nursing home, hospice, extended care, or other special treatment facility, or are you now hospitalized?

There are a few other questions you have to be able to answer “no” to in order to qualify, but these are the major ones relating to your heart.

Life Insurance Quotes after Heart Transplant

Below please find quotes for a *graded death benefit, 20 year term policy, which organ transplant survivors can potentially qualify for if they can answer the questions above “No”.

Age                                          $50,000                         $100,000

Male Age 30                         $63.51                             $122.67 per month

Male Age 40                         $102.22                          $200.10 per month

Male Age 50                         $178.96                          $353.57 per month

Male Age 60                         $299.41                           $594.47 per month

*Quotes above are as of 12/8/11 and are subject to change.  Graded death benefit means the a percentage of the death benefit will be available during the first 2 years.  After 2 years, 100% of the death benefit is payable.

Also note that during the first two years, the full death benefit is payable if death is accidental, but not if death is caused by natural causes.

Available policies are 10 year term, 20 year term, and whole life insurance.

How to Apply for Heart Transplant Life Insurance

For the full questionnaire, to be sure you can qualify, give us a call at 877-996-9383.  If you can qualify, the application is simple.  It’s just a handful of questions, and no medical exam is required.  We can usually have your policy issued within just a few days.

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10 Year Term for Over Age 60

If you are between 60 – 69 years of age and need to get some inexpensive life insurance, then I have the a solution that might be ideal for your circumstances.

The answer would be a 10 year term life insurance policy that should meet most of your needs and cover the reasons why you want to get some life insurance.

As you well know by now, life insurance does get more expensive the older you become, but even in your sixties you can still find term life policies that you can afford.

Just to give you an idea of how affordable a 10 year term policy can be, I’ve provided a few samples to give you an idea of how much your monthly premium would cost for someone in their 60’s.  These rates are for someone does not smoke and is in reasonably good health.

$100,000 Term Life Insurance Quotes for Ages 60 – 69
Age 10 Year Term (Monthly)
60 Year Old Man $29.00
65 Year Old Man $53.41
69 Year Old Man $82.25

(Disclaimer – These rates are effective as of January 15, 2013)

You can see from the rate differential between someone who has just turned 60 compared to someone who has just turned 69 that there is a fairly significant variance between what you would pay for a monthly premium.

So, if you are in your sixties and coming close to another birthday, don’t delay in getting your 10 year term policy because it will cost you more when you have that birthday.

Why a 10 Year Term Life Policy?

Most people in their sixties are getting close to retirement age.  You may not be there yet, and perhaps you plan to work even up to age 70 or even beyond. In any event, you still want to make sure your loved ones have that financial security blanket in case something happens before you retire.

If a serious life threatening illness, or even were you to die unexpectedly, your family will need that extra protection to get through the difficult times.

Another reason why a 10 year term life policy is the best way to go is simply because term life insurance is the cheapest to buy and the easiest to get.  The other main thing to keep in mind is that the monthly premium the company charges you will remain the same during the life of the term so you can budget accordingly.

Finally, you should also know that the death benefit that your beneficiary receives will be tax deferred so the money can be used any way they need to use the death benefits.

Reasons to Buy a 10 Term Life Insurance Policy for Someone in Their 60’s

The reasons why you will want a 10 year term policy will vary from person to person, but most people who are looking to buy term insurance do so for income replacement.  If you need to consider estate taxes, estate planning or setting up a trust you might be better off to look at buying a whole life or universal life insurance policy…….continue page 2……

How to Find Affordable Coverage with Pre-Existing Conditions

Impaired Risk Life InsuranceWhile we are generally very good at Huntley Wealth Insurance with helping individuals with various life insurance needs, our specialty is impaired risk life insurance.

“Impaired Risk” simply refers to the elevated risk a life insurance applicant demonstrates due to medical issues, or occasionally other risk factors.

Life Insurance with Health Impairments

The most common type of impaired risk life insurance is for medical reasons.  So if a 47 year old man has a history of heart disease and was treated with a triple bypass surgery, that would be an impaired risk.

The reason it’s important to use an independent life insurance agent who specializes in impaired risk cases is so you deal with an agent who knows where to place your case.

Most people, when shopping for life insurance, make the first call to their local insurance agent, who probably specializes in home/auto or business insurance, NOT life insurance.

This agent will have no success trying to write a life insurance case with a high risk medical history, not because he or she is incompetent, but this agent simply does not have the required experience to place a tough case.

Try telling your local Farmers Insurance agent you are 6’0 and weigh 280 pounds, and take insulin for diabetes.  He’ll probably tell you he can’t help you.

Or try calling your State Farm agent to see what the cost of life insurance is with multiple sclerosis, or after having a kidney transplant, or if you smoke marijuana.  He might laugh at you.

And yet, we help individuals with impaired life insurance needs obtain coverage like this every day at Huntley Wealth Insurance.

How Much Does Life Insurance Cost with Medical Problems?

Your life insurance premiums will depend on the severity of your health impairment, your age, gender, and then of course, the amount and type of coverage you are applying for.

But generally speaking, the cost of impaired risk life insurance depends more importantly on what type of policy you are able to qualify for.  I recommend my clients try to approve for the cheapest type first (duh), and then if my client can’t qualify for that, move on to the more expensive alternatives.

The four types from most affordable to most expensive are traditionally underwritten life insurance, simplified or jet issue life insurance, graded death benefit, and guaranteed life insurance.

Traditional Coverage – Simplified Issue / No Exam – Guaranteed Issue

  1. Traditionally Underwritten Life Insurance – Unlike income protection insurance, requires a medical exam and application with full medical disclosure.  The insurance company will also access your motor vehicle report, MIB report, and all relevant medical records.  Since the insurance company knows just about every detail about your health in this type of underwriting, if they can make an offer to you, it will most likely be more affordable than the next two options.
  2. Simplified Issue – This is sometimes referred to as jet issue, or no exam insurance.  In this type of underwriting, a medical exam is not required.  The company may still have a lengthy application forcing you to reveal every health detail about your history, and they’ll check your answers against an MIB report and pharmacy report they’ll pull on you, but they won’t make you take a medical exam.  Sometimes, no exam policies are good for people with minor health risks, as the underwriting is quicker and simpler.
  3. Graded Death Benefit – These policies won’t require a medical exam either, and the applications are noticeably shorter than options 1 and 2.  For example, you may only have to answer a half dozen medical questions.  As long as you can answer No to their questions, you qualify.  This type of policy generally costs significantly more than options 1 and 2, because typically only people who can’t qualify for the first two options would apply for graded death benefit life insurance.
  4. Guaranteed Issue – No medical questions on the application.  No health exam.  Just about everyone qualifies, even if you have been diagnosed with a terminal illness.  It’s called guaranteed for a reason.  For people with severe health impairments, guaranteed issue may be their only option.  It is the most expensive of the four.

Perhaps You are “Impaired Risk” Due to Lifestyle Reasons

There are non-medical reasons some people may be classified as “impaired risk”.  These would include, but are not limited to, working in a dangerous occupation, participating in hazardous activities, or traveling outside of the United States.

How to Get an Impaired Risk Quote

If you have a medical condition, call us with the details, and we’ll shop your case out for you.  We know which companies are the most lenient on which medical risks, so your best chance of finding affordable coverage is using Huntley Wealth Insurance.  For a personalized quote based on your health condition, call us at 877-996-9383.

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