Immediate Care Plan – an Underwritten Single Premium Immediate Annuity
The Immediate Care Plan is a medically underwritten single premium immediate annuity. This product is designed to create a guaranteed monthly income stream payable for the life of the annuitant. With individual medical underwriting, monthly income payments may be larger for the annuitants who are less healthy and in need of care compared to traditional single premium immediate annuities.
Immediate Care Plan Product Details
Product Name: Immediate Care Plan
Product Type: Underwritten Single Premium Immediate Annuity
Issue Ages: 70-95
Minimum Single Premium: $50,000
Additional Contracts: $25,000
Maximum: $1,000,0000 without Home Office Approval
Lifetime Income
Guarantee monthly income for as long as the annuitant lives. The monthly benefit is determined at the time of underwriting using factors such as age, and the detailed health of the annuitant along with the income plan chosen and any optional benefits selected. The lifetime income payment can be used for any purpose, including to help provide for living expenses, cover medical expenses, and offset care expenses and ease family financial burdens.
Income Payment Methods
Payments may be received monthly by electronic funds transfer (EFT) or by check.
Early Death Benefit
An early death benefit feature is included within the Immediate Care Plan. If the annuitant dies within the first six months from the contract date, an early death benefit will be paid. The early death benefit is equal to the single premium multiplied by the applicable death benefit percentage, less all income already paid out.
Income Taxes
Each income payment generally will be considered part return and part interest. The portion that is considered to be interest will generally be considered taxable income.
Once all principle has been returned, payments will become fully taxable. If the annuity is funded by qualified money, the full amount of the income payments would generally be taxable. It is important to discuss the taxation of this product with a qualified tax professional.
Fees/Charges – There are no fee or sales charges for this product.
Optional Cost of Living Adjustment*
The owner, at issue, can select an annual cost of living adjustment (COLA) of 1% to 8%. Monthly Income will increase at the rate selected on each contract anniversary, compounded annually.
Optional Enhanced Death Benefit*
The owner of the policy can select life income with a certain period of 1 to 5 years and receive an enhanced death benefit.
If the annuitant dies within the certain period, the enhanced death benefit is the greatest of the minimum benefit amount, less monthly income received, and the early death benefit.
The minimum benefit amount is the sum of the monthly income payments for the number of months in the selected protected period, excluding any additional prorated amount included in the first monthly period.
* Optional features are only available at issue and require additional premium to provide the same guaranteed initial monthly income payment.
