Coventry Direct Praises New NAIC Report On Options For Financing Long Term Care Costs

BLUE BELL, Pa., July 20, 2017 /PRNewswire/ -- Life settlements can be an important asset to help seniors generate resources to pay for their long term care costs, according to a report issued on July 19, 2017 by the National Association of Insurance Commissioners' Long Term Care Innovation (B) Subgroup.

The report recommends life settlements – in which policyowners sell an existing life insurance policy and receive a significantly greater cash settlement than if they lapse or surrender the policy back to the insurance company – as "one option seniors might use to generate resources to pay for their long term care needs." The NAIC report cites federal and university studies that show that policyowners who sell their policies can receive lump sum payments that are "four or more times greater than if they lapsed or surrendered their policy," and that, in some instances, policyowners can "sell a portion of the policy, thus retaining a portion of the original death benefit for their beneficiaries, while reducing or eliminating future premiums."

Importantly, a life settlement is the only option mentioned in the NAIC report which does not require policyowners to pay additional money out of pocket in order to realize a benefit. The other options cited in the report are products sold by insurance companies that require cash outlays by policyowners in order to receive future benefits. These insurance company options may not be practical for policyowners living on a fixed income.  

Both financial professional and elder care advisors are already recommending that life settlement proceeds can be used to pay for long term care costs under structured programs, according to the NAIC.  The Subgroup report also cites federal tax law that allows certain policyowners to sell their policies and receive the proceeds of the sale free from federal tax.

The report can be read here:  http://www.naic.org/documents/cmte_b_ltci_sg_related_private_market_options_ltc_serv.pdf

About Coventry Direct

Coventry Direct educates consumers about the option to sell their life insurance policy through a life settlement, giving policyowners the choice to sell their unneeded life insurance and realize more value than a surrender or lapse. By continually expanding opportunities for policyowners, Coventry Direct is helping to make life insurance more flexible, more powerful and more valuable. To learn more about life settlements call 1.800.COVENTRY or visit us at www.coventrydirect.com.

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SOURCE Coventry Direct