How to Pay for Assisted Living Using Life Insurance

Shawn Plummer, CRPC

Chartered Retirement Planning Counselor

Using Living Benefits

  1. Understand Living Benefits: Living benefits are a feature in some life insurance policies that allow you to access part of the death benefit while you’re still alive. This can be useful for covering expenses such as assisted living.
  2. Check Your Policy: Review your life insurance policy or contact your insurer to determine if it includes living benefits.
  3. Evaluate Eligibility: Living benefits often require specific conditions to be met, like a terminal or chronic illness. Ensure you meet these criteria.
  4. Apply for Living Benefits: If eligible, complete the application process through your insurance provider. This may require medical documentation.
  5. Receive Funds: Once approved, you’ll receive a portion of your death benefit, which can be used to pay for assisted living costs.

Selling Your Life Insurance Policy

  1. Consider a Life Settlement: Selling your life insurance policy to a third party for a cash settlement is known as a life settlement.
  2. Qualification: Generally, life settlements are more accessible to older adults, typically over the age of 70, or those with a life-threatening illness.
  3. Find a Provider: Contact a life settlement company or broker to initiate the process.
  4. Undergo Evaluation: The company will evaluate your policy, life expectancy, and health to determine the settlement value.
  5. Complete the Sale: If you agree to the offer, you’ll receive a lump sum payment. The buyer takes over premium payments and becomes the beneficiary of the policy.
  6. Use Funds for Assisted Living: The received funds can be used to finance your stay in an assisted living facility.

Conclusion

Paying for assisted living through your life insurance policy can be achieved either by utilizing living benefits or selling your policy for a life settlement. Each option has its specific processes and requirements. By understanding and evaluating these options, you can effectively utilize your life insurance to support your assisted living needs.

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Shawn Plummer, CRPC

Chartered Retirement Planning Counselor

Shawn Plummer is a Chartered Retirement Planning Counselor, insurance agent, and annuity broker with over 14 years of first-hand experience with annuities and insurance. Since beginning his journey in 2009, he has been pivotal in selling and educating about annuities and insurance products. Still, he has also played an instrumental role in training financial advisors for a prestigious Fortune Global 500 insurance company, Allianz. His insights and expertise have made him a sought-after voice in the industry, leading to features in renowned publications such as Time Magazine, Bloomberg, Entrepreneur, Yahoo! Finance, MSN, SmartAsset, The Simple Dollar, U.S. News and World Report, Women’s Health Magazine, and many more. Shawn’s driving ambition? To simplify retirement planning, he ensures his clients understand their choices and secure the best insurance coverage at unbeatable rates.

The Annuity Expert is an independent online insurance agency servicing consumers across the United States. The goal is to help you take the guesswork out of retirement planning and find the best insurance coverage at the cheapest rates

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