Life Ins W LTC

[pfg1]

What was the year 15 RoR on the CV on the MG quote you have?

And yes, I am contracted with MM and can get you an illustration. I will upload it to this thread if I can.

It doesn't show a ror / cash value growth on it, just a surrender value. $70k at yr 15. From what I understand, its not really designed to build cash value... just to stay in force and provide death benefit / ltc benefit - OR you can get all your cash back from yr 10 on. It stays in force until 120 on the 10pay. Maybe I'm missing something.

 

[CALTCAgent]

Is it wrong to look at it that way? If she says she doesn't want to spend the $ on a full blown ltc policy, because she feels like she'll never use it (and likely lose it) what do I tell her?

Show her both and let her decide. Sounds like she has shown a preference already.

 

[scagnt83]

If client needs 10 pay, and WANTS long term care coverage, best hybrid options will be lincoln mg or state life asset care iv. Best traditional opion mass mutual signature care. Maybe new york life, but would have to check.

Jack, you should look at the Rider on MMs traditional life products.

----------

It doesn't show a ror / cash value growth on it, just a surrender value. $70k at yr 15. From what I understand, its not really designed to build cash value... just to stay in force and provide death benefit / ltc benefit - OR you can get all your cash back from yr 10 on. It stays in force until 120 on the 10pay. Maybe I'm missing something.

My point is that the RoR is negative on the account value. If she fully surrenders she gets the premiums back and gets a 0% RoR.

So how is that better than a CD from a rate of return standpoint?


My larger point is that MG puts money to sleep. It does not grow it. The MM 10 Pay option grows her money at 3% (more than triple the average CD), plus it will give her a $3k/m LTC benefit. Plus it will give her a DB.

 

[pfg1]

Jack, you should look at the Rider on MMs traditional life products.

----------




My point is that the RoR is negative on the account value. If she fully surrenders she gets the premiums back and gets a 0% RoR.

So how is that better than a CD from a rate of return standpoint?


My larger point is that MG puts money to sleep. It does not grow it. The MM 10 Pay option grows her money at 3% (more than triple the average CD), plus it will give her a $3k/m LTC benefit. Plus it will give her a DB.

Gotcha. I'm all ears

 

[scagnt83]

Gotcha. I'm all ears

Ok. I have attached an illustration for you. The LTC Rider section is towards the end of the illustration. There is also an RoR page for the CV in the middle.


To compare to MG at year 15 (using the same premiums of $14k/y):

.......... MG ...................................................... MM 10 Pay

CV= 0% .......................................................... 2% (3% by year 20)

DB= $198k (decreasing at this point) ................. $240k

LTC= $6400/m for 4 years .............................. $4680/m for 4 years



So MG gives a larger LTC benefit. But MM10 Pay gives you actual gain on your CV.
Plus MM gives a larger DB that grows larger each year and does not decrease with time like MG in this situation. (by mid 90s you hardly have any DB RoR at all when I illustrated your case on MG)


MG is simply leveraging a lump sum to provide a LTC benefit. MM 10 pay is leveraging a lump sum to provide a LTC benefit, Cash Accumulation, & an ever growing Death Benefit.

 

[Mr_Ed]

Ok. I have attached an illustration for you. The LTC Rider section is towards the end of the illustration. There is also an RoR page for the CV in the middle.


To compare to MG at year 15 (using the same premiums of $14k/y):

.......... MG ...................................................... MM 10 Pay

CV= 0% .......................................................... 2% (3% by year 20)

DB= $198k (decreasing at this point) ................. $240k

LTC= $6400/m for 4 years .............................. $4680/m for 4 years



So MG gives a larger LTC benefit. But MM10 Pay gives you actual gain on your CV.
Plus MM gives a larger DB that grows larger each year and does not decrease with time like MG in this situation. (by mid 90s you hardly have any DB RoR at all when I illustrated your case on MG)


MG is simply leveraging a lump sum to provide a LTC benefit. MM 10 pay is leveraging a lump sum to provide a LTC benefit, Cash Accumulation, & an ever growing Death Benefit.

The MG values are all guaranteed.
The MM values are based upon dividend performance.
big difference.

Also, she could get richer long term care benefits with State Life and you don't have to worry about a questionable dividend... all the benefits are guaranteed.


None of these products are significantly better than the other.
It primarily comes down to underwriting.
And it comes down to weighing what's more important:

death benefit, "cash back", or long-term care benefits.

No product will be the "best" in all 3 points.
If you want the "best" death benefit, then you'll have to sacrifice LTC benefits.

If someone wants a product to help pay for long-term care, why not sell the product with the best long-term care benefits?

 

[scagnt83]

The MG values are all guaranteed.
The MM values are based upon dividend performance.
big difference.

Also, she could get richer long term care benefits with State Life and you don't have to worry about a questionable dividend... all the benefits are guaranteed.

MM has paid a dividend every year for over 100 years... and their average historical dividend is more than the current... most logical people would not call that questionable.

(But as I already stated in this thread I know you believe dividends are never paid and are just a fantasy... despite 100+ years of evidence otherwise)

Does state life offer a 10 pay option?

----------

And it comes down to weighing what's more important:

death benefit, "cash back", or long-term care benefits.

No product will be the "best" in all 3 points.
If you want the "best" death benefit, then you'll have to sacrifice LTC benefits.

I agree. But imo the MM rider offers the best combo of all 3... along with the best CV RoR hands down.

----------

If someone wants a product to help pay for long-term care, why not sell the product with the best long-term care benefits?

Because many people would trade the larger ltci benefit for a decent RoR.

With any combo type product there are always multiple goals trying to be achieved. If its just about the Ltci benefit then they should get a traditional policy.

To me, MG is just a traditional policy with a living ROP.

Many people have a problem with putting a large sum of money to sleep.

You always have trade offs when comparing strategies/products.

If the OPs client is ok with a 0% RoR then she should go with MG. If she likes the idea of a decent RoR then she should go with MM.

 

[pfg1]

Ok. I have attached an illustration for you. The LTC Rider section is towards the end of the illustration. There is also an RoR page for the CV in the middle.


To compare to MG at year 15 (using the same premiums of $14k/y):

.......... MG ...................................................... MM 10 Pay

CV= 0% .......................................................... 2% (3% by year 20)

DB= $198k (decreasing at this point) ................. $240k

LTC= $6400/m for 4 years .............................. $4680/m for 4 years



So MG gives a larger LTC benefit. But MM10 Pay gives you actual gain on your CV.
Plus MM gives a larger DB that grows larger each year and does not decrease with time like MG in this situation. (by mid 90s you hardly have any DB RoR at all when I illustrated your case on MG)


MG is simply leveraging a lump sum to provide a LTC benefit. MM 10 pay is leveraging a lump sum to provide a LTC benefit, Cash Accumulation, & an ever growing Death Benefit.

Thanks. Can you run one at $7k/yr for me if you don't mind? That's really the max of what I'm looking at from a budget standpoint - most likely. I appreciate it!

 

[Mr_Ed]

yes the state life product offers a 10 pay policy.
(10 pay, 15 pay, 20 pay, single pay, lifetime pay, etc...)
that's what i ran before i made that post.

 

[CALTCAgent]

Since we are running quotes, anybody have the numbers on how State Life compares to Mass 10 pay ?