The Funeral Trust

[theinuranceguy]

I heard that NGL and FDLIC are having problems with these in some states. Is there any truth to that? I think Michigan was mentioned.

I'm interested in Indiana and Kentucky. How do NGL and FDLIC compare?

FDLIC is licensed in a lot of states, Indiana and Kentucky being in that bunch.

The trust is a fuzzy area when in comes to selling it, you can only put in a "resonable amount" or "average cost of a funeral"... whatever that is.

FDLIC is not Licensed in MI though.

I am not familiar with NGL's products, I would have to do some research...

As of now, FDLIC has put a cap of $15,000 on a trust...
So if a state would allow $20,000 FDLIC will only do $15,000
If that state would allow $10,000 FDLIC will do the WHole $10,000

It also is based on situations... For Example:
A health 50 year only would be able to buy trusts on his wife, kids, and grandkids. Where an unhealthy 70 year in a nursing home would not be able to do so, although I am sure it has been done before.

We have an elder law attorney on staff here, it makes its easier for us to determine what we can and cannot do, he is only Licensed in OH though.

 

[Winters Ins Agcy]

I know this is an old thread but I was looking for a discussion on FDLIC as a result of meeting with a lady yesterday who has a policy with them. It is not a funeral trust but more of a life insurance policy. The documents are very minimal but it appears that she has about $7,300 worth of benefit at a funeral home, consisting of a combination of materials and services. She is paying $121/mo. for this policy and has been paying it on it for about 6 years. She's only 70 now. In other words, she's clearly already paid in more than the resulting benefit.

She claims that she became good friends with the agent (I can imagine why, the agent probably made a killing in commissions), so I advised her to call her and get more details. It appears that the $121/mo. premium is in perpetuity, which, if true, is ridiculous. I assume also that there's no cash value that she can cash this out and get a more reasonable policy (final expense). It appears that she's "stuck" with it. It's a financial albatross for her. I think the only way she can stop it is to have her bank decline the monthly EFT.

Does anyone have any information on this specific plan that they can share? I'm thinking she might want to cut her losses now and get into a $10,000 FE policy for around $50/mo. But not sure how to proceed. I can't believe this hasn't been brought up here before as to me this policy is quite usurious.

 

[Newby]

I know this is an old thread but I was looking for a discussion on FDLIC as a result of meeting with a lady yesterday who has a policy with them. It is not a funeral trust but more of a life insurance policy. The documents are very minimal but it appears that she has about $7,300 worth of benefit at a funeral home, consisting of a combination of materials and services. She is paying $121/mo. for this policy and has been paying it on it for about 6 years. She's only 70 now. In other words, she's clearly already paid in more than the resulting benefit. She claims that she became good friends with the agent (I can imagine why, the agent probably made a killing in commissions), so I advised her to call her and get more details. It appears that the $121/mo. premium is in perpetuity, which, if true, is ridiculous. I assume also that there's no cash value that she can cash this out and get a more reasonable policy (final expense). It appears that she's "stuck" with it. It's a financial albatross for her. I think the only way she can stop it is to have her bank decline the monthly EFT. Does anyone have any information on this specific plan that they can share? I'm thinking she might want to cut her losses now and get into a $10,000 FE policy for around $50/mo. But not sure how to proceed. I can't believe this hasn't been brought up here before as to me this policy is quite usurious.

That is funeral directors life insurance company. It's just a regular funeral Preneed policy. Should be paid up in 10-years. The death benefit started at $7,300 but grows each year.

She shouldn't have bought it unless she could pay it off quicker. But this far in it will be paid up soon.

It does have cash value. RPU may be an option.

 

[Winters Ins Agcy]

That is funeral directors life insurance company. It's just a regular funeral Preneed policy. Should be paid up in 10-years. The death benefit started at $7,300 but grows each year.

She shouldn't have bought it unless she could pay it off quicker. But this far in it will be paid up soon.

It does have cash value. RPU may be an option.

Thanks for the response.

So, after 10 years, she will have paid in $14,520. By that time, how much could her death benefit have grown? Enough to cover that pay-in? Less? More?

She still has about $6,000 left to pay into the policy.

From my perspective, this policy is designed to benefit the funeral home, the insurance company and the agent.

 

[Newby]

Thanks for the response. So, after 10 years, she will have paid in $14,520. By that time, how much could her death benefit have grown? Enough to cover that pay-in? Less? More? She still has about $6,000 left to pay into the policy. From my perspective, this policy is designed to benefit the funeral home, the insurance company and the agent.

It will be less but eventually it will be more if she lives long enough.

Those policies are the best thing there is for the right situation. But can be a bad choice in others.

The benefit is not limited to the policy face amount if there is a funeral home price guarantee.

 

[lifeinsuranceguide]

I am also interested in Indiana. Anyone can compare the rates for me? It seems hard for me to take the decision.

 

[Newby]

I am also interested in Indiana. Anyone can compare the rates for me? It seems hard for me to take the decision.

I can't understand what you are asking.

 

[TwiLight]

I can't understand what you are asking.

What you mean by talking underwear asking folders to wait?

 

[Rhmont]

Wouldn't you know the "recruiter" hasn't been in contact with me. One of the features, I was told, was protection from Medicaid spendown requirements (advantage over cds, etc.).

I would say I'm still at ground zero on Funeral Trusts. Doesn't anyone sell them???

I do sell them. Great product.