Thanks to advanced technologies and ongoing medical research, substantial strides have been made in health care, allowing many more to survive and thrive after a devastating diagnosis. For example, while lung cancer remains among the top three cancer diagnoses among men and women globally, lung cancer’s five-year survival rate is now approximately one in five, up from just one in 10 in 1975.
Still, there is a cost to better treatment and survival rates: hefty medical expenses. Life insurance can play a significant role in mitigating healthcare expenses. Policies can be structured with terminal and critical illness riders, long-term care benefits and well-timed cash value accumulation with the potential for tax-free loans. This makes life insurance a vital tool for those who need to cover Medicare cost-sharing, prescription drug donut holes, long-tail health effects of COVID-19, and more.
Yet, with the emergence of COVID-19 and new issues with comorbidities, we can expect to see major swings in underwriting standards and insurance rates over the next decade. This makes it even more important to get your clients into a life insurance policy today.
One-quarter of Americans say health care is top national issue
A recent survey conducted by the Employee Benefit Research Institute found that 26 percent of respondents considered healthcare the biggest problem in America today. The reason? Cost. A mere 20 percent of respondents said they were “very” or “extremely” satisfied with what they were paying to be insured. And in the past year, 50 percent said they were spending more for coverage now than 12 months ago.
Your high-net-worth clients are not immune to this problem, and while they may be able to afford to pay out-of-pocket medical and home healthcare expenses, doing so could put them in the unenviable position of liquidating assets at the wrong time. In a study done by the Insured Retirement Institute that polled 1,000 consumers, each of whom had investable assets of $250,000 or more, 60 percent said they were ill-prepared financially for a major health event.
A life insurance policy designed to cover shortfalls in healthcare planning funded by a premium loan can be an ideal solution for these individuals. Premium financing, or Leveraged Planning®, solutions can be structured as wealth creation strategies and often provide greater financial certainty in times of good health and bad. In short, premium financing offers income planning opportunities that may enable your clients to leave their invested assets alone while still preparing for the unexpected. For more information, speak with a GFD Financial Services Manager.
