Buy LTC Separate or Together with Whole Life Policy?

Jun 29, 2016

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  1. khang.mis
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    khang.mis Expert

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    Hello! I am a P&C broker, not too versed in life and LTC. I have a client who has arthritis and smokes weed. What would offer the best value? Buying a whole life w/ LTC rider or buying a term and a separate LTC policy? Suggestions would be appreciated, thank you!
     
  2. Arthur Rudnick
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    Arthur Rudnick Moderator Moderator

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    It depends on what your client is looking for. A WL policy and a LTC policy are 2 different animals serving 2 different purposes.

    At the least, look for a smoker rating on either product, assuming he's insurable at all.

    Is the marijuana medically prescribed for his arthritis?
     
  3. ltcadviser
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    ltcadviser Guru

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    I have written thousands of LTC policies and I am still waiting for my first client to admit to drug use.
     
  4. L5tc
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    L5tc Super Genius

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    I always get them to admit it. If I don't ask they won't say so I ask. They don't want to get declined so they work with me.
     
    L5tc, Jun 30, 2016
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  5. ltcadviser
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    ltcadviser Guru

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    You get them to admit it? So, let's see if I got this right. Mutual of Omaha application Section H. Q. You ask:

    "During the last 10 years have you ever used unlawful drugs...other than as prescribed by your doctor?"

    Your client says "No."

    And you get them to admit something after they have answered "No?"

    What would the follow up question be?

    "Sir, everyone has answered this question "No" in 20 years, but I have to assume some people are not being truthful with me, so let me ask you one more time: Are you sure you haven't smoked weed at some point in the past 10 years? Done some coke? Just tell me. Come to Jesus"

    I love it.

    :D
     
  6. yankee466
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    yankee466 Guru

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    Jack:

    Does that mean you won't turn in your pot growing/selling clients after you signed the Lincoln MoneyGuard Marijuana form saying you would? :D
     
  7. ltcadviser
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    ltcadviser Guru

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    I love that form Herman, but my clients are all clean cut and drug free so no worries here.

    But Barry's clients---Barry is rolling (no pun intended) with the haight-ashbury crowd! Barry is going to be marketing in Colorado, I think :cool:
     
  8. Arthur Rudnick
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    Arthur Rudnick Moderator Moderator

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    Jack, here's the problem.......
    All life carriers and some LTC carriers require blood tests in order to qualify for insurance. I believe that the blood holds marijuana markers for 30-40 days.

    So, if he is only a recreational user, the question can be asked and answered 'no' because there's no trace in his blood. Hair samples are different, That shows up for a longer period of time.

    I asked khang.mis if his client's marijuana was medically prescribed for his arthritis? Bottom line, if so it will show up on his APS.

    I had this come up for the 1st time last year when writing an app for a 33 year old woman for life insurance. I asked the drug question and she said 'no'.

    She was 8 months pregnant at the time of app and the carrier was fine with that because she was having a normal delivery. I pre-qualified her and put the app through Preferred +, non smoker.

    So, when her policy is issueed, it's a Standard Smoker.
    What???

    It turns out that 6 months before her pregnancy (14 months ago) she was a recreational pot smoker and used maybe once or twice a month. When she decided to get pregnant, she stopped. She disclosed this to the para med who came for the exam.

    I call her and ask "what the hell were you thinking?) and she says she's an attorney and in good faith she had to tell the truth. Well, she told the truth and her premium went up from Pref+, non-smoker $590 to over $1,700. She cancelled the policy. The problem is the rating and reason are now registered with MIB and she's pretty well screwed for a long time.

    The problem with khang.mis is he knows his client smokes pot. Not sure about him, but most honest agents will not lie on the app.
     
  9. L5tc
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    L5tc Super Genius

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    I don't talk to them in such a cold upright fashion. I ask that question and then ask them again and tell them what happens if they're not being honest AND that I'm on their side. "You won't get a policy and I won't get paid."

    What's so difficult about that. Maybe it's something we can do in NY? That's what I say. I don't cross my fingers, I just ask them.
     
    L5tc, Jun 30, 2016
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  10. ltcadviser
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    ltcadviser Guru

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    Yes, I know the issues. MIB is the biggest issue. I had only one case in my life, a term life application for an Atlanta attorney in 2001. He was declined for coke. Blew his top, threatened to sue the underwriter, claimed he's never done coke and then said "Jack, please do not tell my wife."

    Today, if anyone asked me to write an application and admitted to drug use I would just explain the issues to the client and respectfully withdraw.

    ----------

    Well, it's really not about us so you can eliminate the "I won't get paid" spiel!
     
    Last edited: Jun 30, 2016