Questions & Answers

Q: Who is Life Care Funding Group?

A: Founded in 2007, Life Care Funding Group (LCFG) assists people in need of funds to cover the costs of senior housing and long term care. LCFG specializes in converting the death benefit of an in-force life insurance policy into a long term care benefit to cover the costs of skilled nursing home care, assisted living, home health care, and hospice.

Thousands of assisted living communities, nursing homes, retirement communities, home healthcare providers and senior care advisors offer the LCFG program to families' everyday. LCFG's national education campaign has brought awareness about this important financial option to millions of people across the United States. National publications such as Kiplinger's, The Wall Street Journal, and The New York Times have all published stories about the importance of Funding Solutions for Senior Living.

Q: What is the Assurance Benefit?

A: The basic premise is to convert the death benefit of an in-force life insurance policy into a long term care benefit which is paid directly to the long term care provider, either SNF, AS, IL, CCRC or HHC. The Life Care Assurance Benefit pays out a long term care benefit to the care provider over a 15 to 30 month period, depending on the family's needs, while preserving a death benefit or end of life expense benefit for the family. If the senior should die before the benefit period ends, the balance of the Assurance Benefit goes to the family as a death benefit. The program is flexible allowing seniors and their families to increase the death benefit preserved or spend most of it on long term care services.

Key Benefits of the Program Include:

• Simple application and review process
• No age or policy size minimum
• No premium payments
• All types of in-force life insurance qualify
• Fixed payments made directly to care provider/facility
• Preserves partial death benefit
• Provides final expense funeral payment
• Benefit can stop and start or be adjusted to match changing needs
• SNF, AL, Home Health and Hospice all qualify

Q: Who qualifies for the Assurance Benefit?

A: Owners of an in-force life insurance policy of any type that have a need to pay for long term care services.

Q: Is there a minimum amount of life insurance that can be converted?

A: No, Life Care Funding Group works with polices of any size.

Q: What type of life insurance qualifies?

A: Every type of life insurance contract is eligible, including:

• Universal Life
• Term Life
• Whole Life
• Variable Life
• Group Life
• Survivorship (any type)
• Adjustable Life
• Joint First to Die

Q: Am I responsible for paying the premiums if I enroll in the Assurance Benefit program?

A: No, you will be relieved entirely of that responsibility.

Q: When is it time to consider the Assurance Benefit?

A: If a policy owner no longer needs or can no longer afford their policy, is spending down assets to qualify for Medicaid and is considering letting it lapse or surrendering it for the remaining cash value -- then the Assurance Benefit should be considered.

Q: What are the legal rights of a policy owner?

A: A life insurance policy is legally protected as personal property and the policy holder has the guaranteed right to convert or sell their ownership interest in a life insurance policy without limitations.

All insurance policy owners have the following rights:

• Name the policy beneficiary
• Change the beneficiary designation
• Convert the policy to a new form of benefit
• Sell the policy to another party
• Assign the policy as collateral for a loan
• Borrow against the policy

Q: Are the proceeds from the Assurance Benefit taxable?

A: The proceeds from an Assurance Benefit enrollment can be taxable. Typically, the taxable proceeds are based on the difference between the cost basis of a policy (the money paid in) and the cash “surrender” value and the final settlement amount received by the policy holder as to what is considered taxable. Life Care Funding Group strongly recommends that a policy owner seek professional tax advice prior to accepting any offers.

Q: Can the Assurance Benefit impact eligibility for social assistance programs?

A: A life insurance policy is legally recognized as an asset of the policy owner and it counts against them when qualifying for Medicaid. If a policy has anything more than a minimal amount of cash value (usually in the range of $2,000) it must be liquidated and that money spent towards cost of care before the owner will qualify for Medicaid. All Medicaid applications specifically ask if the applicant owns life insurance and full policy details. Failure to disclose and comply is fraud.

Some states allow for a final expense policy to be kept or transferred to a funeral home (but the funeral home would keep the entire death benefit). Medicaid recovery units have become much more forceful about looking for life insurance policy death benefits (declared and undeclared) that have paid out to families after the death of a Medicaid recipient. Medicaid budgets are now facing extreme pressure and asset recovery efforts can be very aggressive. Recovering the entire cost of care through legal actions against the estate and surviving family to go after the death benefit payment are common. Medicaid rules are very clear that a life insurance policy is an unqualified asset and counts against Medicaid eligibility. The owner of one or more policies has a variety of options to consider:

• A policy with more than a minimal amount of cash value (usually $1,500 or more depending on the state) must be liquidated with the proceeds spent down on care.
• A policy with no cash value does not need to be liquidated but the death benefit will be subject to Medicaid recovery efforts to return the amount of money spent on care.
• Many states will exempt a “final expense” policy if the full death benefit value is assigned to a funeral home.
• Assignment of a life insurance policy for less than its fair market value is a violation of asset transfer rules if done within the 60 month look back period.
• A policy owner has the legal right to convert a life insurance policy into a long term care benefit plan at its fair market value and extend their spend down period by covering cost of care while preserving a portion of the death benefit until exhausted.

Every state’s Medicaid requirements vary and Life Care Funding Group strongly recommends that a policy owner consult with the appropriate social services agency or a financial advisor concerning how ownership of a life insurance policy and a Assurance Benefit enrollment could affect your eligibility and that of your spouse or dependents.

Q: How does the Assurance Benefit process work?

A: Applying for the Assurance Benefit is easy and fast—

1. Fill out the Life Care Funding application online or over the phone with one of our helpful representatives.
2. Submit a copy of the life insurance policy.
3. Provide medical records.
4. Complete the benefit enrollment forms.
5. Designate payment amount to care provider and/or facility.

There is no cost or obligation to apply for the Life Care Assurance Benefit.

Contact us today for a free, no-obligation consultation.

Call 1-888-670-7773 to learn more.