Family Insurance Needs
Table of Contents
Chapter One
Life Insurance
How much life insurance do I need? 8
Immediate Expenses 10
Future Expenses 11
Calculating 13
Major Functions 19
Term Insurance 21
Annual Renewable 22
Convertible 22
Decreasing 23
Level 23
Deposit Level Term 23
Cash Value Insurance 25
Straight Life 26
Preferred Risk 26
Interest-Sensitive Whole Life 27
Universal Life 28
Modified Endowment Contract 31
Adjustable Life 32
Variable Life 33
Survivorship Life 35
Single Premium Life 36
Endowment Insurance 39
Blended Policies 40
Family Protection Blended Policies 41
Credit Life 41
Travel Insurance 42
Choosing a Company 42
Chapter Two
Health Insurance
Introduction 43
Presented Bills 45
Medicare 51
Medicare Part A 52
Medicare Part B 53
Medicare Part C 53
Medicare Part D 54
State Universal Health Care Programs 54
Legislation 55
Affordable Health Care for America Act 55
2010-2011 56
During 2011 the following became effective 57
Effective in 2012 58
Effective as of 2013 59
Effective as of 2014 60
Effective 2015 62
Effective 2018 62
Benefits by Groups 63
Benefits for Children 63
Benefits for Young Adults 65
Benefits for Early Retirees 66
Benefits for Senior Americans 67
Benefits for Minorities 69
Benefits for Disabled Americans 69
Benefits for Veterans and Military
Personnel 70
Benefits for Small Businesses 71
Where Are We Headed 73
Dental Policies 75
Incidental health Care Protection 76
Health Coverage for Overseas Travelers 76
Blanket Health Insurance 77
Group Credit Health Insurance 77
Disability Insurance 78
Pet Insurance 79
Chapter Three
A Child's Insurance Needs
Life Insurance 81
There are advantages 82
Health Insurance 82
Chapter Four
Planning for Retirement
Pre-Planning 84
Where will the money come from? 85
How much is enough? 86
Annuities; what are they? 87
Annuity Development 91
Reinsurance network 91
Two-tiered annuities 92
Investment Options 93
Immediate Annuities 94
Payout period 94
Straight Life Annuity 95
Refund Annuity 95
Joint-and-Survivor Annuity 95
Immediate Variable Annuities 96
Using Variable Annuities for Retirement 97
11-point Checklist 99
Deferred Annuities 100
Equity-Index Fixed Annuity 101
Accumulation Annuity 102
Which annuity is Best? 102
What is annuitization? 103
Seven-Pay Life Insurance 105
Exclusion ratio 105
Why would a policyholder annuitized? 107
Bail-out Provision 109
What are some advantages of annuities? 110
FDIC / BIF / SAIF 110
Pass-through Insurance 111
1035 Tax-free Exchange 114
Guaranteed Death Benefit 117
Are there any disadvantages? 118
Pension Plans 121
ERISA 121
Defined Benefit Plan 122
Defined Contribution Plan 122
ESOPs 123
Long-Term Care Insurance 124
Why buy a LTC policy? 124
Defining Policy Benefits 126
Long-Term Care Contracts 127
Integrated Policies 129
Hospice 131
Age-rated Policies 133
Types of Care Facilities 134
Qualifying For a Policy 134
No Policy Covers Everything 135
Activities of Daily Living 137
Tax-Qualified Long-Term Care Contracts 137
Understanding the Difference in
Benefit Triggers 139
Federal Criteria 140
Assessing the Need 141
Realistically Speaking 141
Asset Inventory 143
Liabilities 145
Estate Planning Tools 145
Asset Transfer 147
Government Sponsored Programs 147
Reverse Mortgages 148
Paid Family Member 150
Accelerated Life Insurance Benefits 151
The Largest Payer of LTC: Medicaid 152
Asset transfers for Medicaid Eligibility 153
Any Income Available 155
Chapter Five
Disability Insurance
Who needs disability coverage? 156
Why not practical to 100% of income 158
How much coverage is needed? 158
Social Security 159
SSDI & SSI 159
Workman's Compensation 162
Degrees of Disability 162
How soon should benefits begin? 164
How long should benefits last? 164
Managing the DI Benefits 165
Where is DI coverage available? 166
Employer Provide Disability Coverage 166
Association or Group Disability 168
Multiple employers Trusts 169
Individual Disability Coverage 170
ARDI 170
Uniform Policy Provisions 171
Approaches to Selling 173
Description of Optional Provisions 174
Waiver-of-premium Provision 174
Non-occupational Provision 175
Transplant Provision 175
Rehabilitation Provision 175
Non disabling Injury Provision 175
Preexisting Conditions Provision 175
Free Look Provision 176
Common Riders 176
Return of Premium Rider 176
COLA Rider 176
Social Security Rider 177
Purchase Option Rider 177
Residual Disability Income 178
Family Income Rider 178
Accidental Death & Dismemberment 178
Occupational Classifications 179
Special Circumstances 181
Is Underwriting Necessary? 181
Adverse Selection 182
The Agent's Role in Underwriting 183
The Underwriting Process 184
Moral & Morale Hazards 186
The Underwriting Decision 188
Social Insurance 189
SSDI & SSI 190
Qualifying for SSDI 190
Qualifying for SSI 190
Following Application for SS Benefits 191
Definition of SGA 193
RFC 194
Life and the Application 194
Supplement Security Income 196
Who is eligible for SSI 196
Commonly asked Questions 197
Chapter Six
Paying for College
Introduction 199
Tips for savings for college 200
Expenses incurred for college 201
Estimating College Expenses 202
How much does a family need to save? 203
What is the best way to invest? 204
Bank Accounts 205
Certificates of Deposit 205
College Savings Bank 208
Bonds 209
Life Insurance 210
Annuities 212
Mutual Funds 214
UGMAs or UTMAs 216
2503(c) Minor's Trust 217
Prepaid Tuition Plans 217
Financial Aid 218
Ways to Keep Expenses Down 221
AP Courses & Exams 221
The Family Plan 221
Alumni Discount 222
Attending Community College 222
Chapter Seven
Wills, Probate & Trusts
Wills 223
Intestate 223
Codicils 225
Homemade Wills 228
Joint Wills 228
Living Wills 229
Rule of Revocation 230
Testamentary Trust 231
Probate 231
Living Trusts 232
Homemade Trusts 234
Funded Trusts 235
Standby Living Trust 235
Revocable Living Trusts 237
Bypass Trust 238
General Power of Appointment Trust 238
QTIP 238
Irrevocable Life Insurance Trust 239
Charitable Remainder Trust 239
Charitable Lead Trust 239
Avoiding Probate 239
Revocable Living Trust Disadvantage 240
Power of Attorney 241
Guardians, Conservators & Committees 243
Irrevocable Living Trust 244
Types of Irrevocable Living Trusts 246
GRIT 248
Uniform Gifts to Minors 249
Testamentary Trusts 249
Q-TIP / Q-DOT 250
Combination Trusts 251
Trust Record Keeping 252
Trustees 252
Planning for Death 253
Joint Accounts 255
Choosing an Attorney 257
Special Provisions 258
Spendthrift Clause 260
Ademption 262
Real Property & Personal Property 263
Simple Fee Estates / Life Estate 264
Remainderman / vested & contingent 265
Special Agreements 265
Domiciles & Property Ownership 266
Concurrent Ownership 267
JTWRS 267
Gifting & Other Property Disbursement 269
Third Party Transfers 271
A Sham Gift 272
Preferential 273
Dower / Statutory Share 274
Per Stirpes / Per Capita / Specific Bequests 275
Secondary & Tertiary Beneficiaries 276
Following Legal Procedures 277
Self-Proving Wills 277
Property Transfers 281
Selecting Trustees & Other Representatives 282
Executor / Executrix 285
Administrator / Administratrix 285
Settling the Estate after Death 286
Common Property Agreement 290
Empty or Non-Funded Trusts 291
Preparation for postmortem managmt. 292
The Gross Estate 295
Funeral Planning 298
Chapter Eight
Divorce
Retirement Accounts 300
QDROs 300
Defined Contribution Plans 301
Defined Benefit Plans 302
Property 303
Life Insurance 304
Health & Medical Insurance 305
Social Security 305
Wills 306
Chapter Nine
Agent Ethics
Ethics 308
What are ethics? 309
Our Past Becomes Our Present 311
Who Determines Ethics? 312
Virtues 313
Ethics Decisions 314
Promoting Ethical Behavior 316
Egoism versus Egotism 319
What is the Scope of Ethics? 320
What does it take to be a moral person? 322
What do I want my legacy to be? 323
EXAMPLE #1 325
EXAMPLE #2 326
What are our responsibilities? 326
Selling Ethically 328
Education 329
Getting Education in a Timely Manner 330
Laying Out Policy Benefits & Limitations 333
Full Disclosure 334
Policy Replacement 336
Why would an agent replace their own? 336
When the Agent Allows Misconceptions 338
When Premium Appears too High 339
Obtaining Proper Signatures 339
Keeping in touch after the Sale 340
Selling the “Fast Buck” Items 341
Commingling Funds 342
Following Regulations 342
Competency 345
Simultaneous representation 346
Admitted Assets 348
Consolidated Assets 348
Investment Grade Issues 348
Mandatory Securities Valuation Reserve 349
Capital Ratio 350
Net Premium Income 350
Surplus Reinsurance 351
United Insurance Educators, Inc.
8213 – 352nd Street East
Eatonville, WA 98328
Fax: (253) 846-7536
Email: mail@uiece.com