More Care. More Control.

A healthcare setback can affect the things your clients do every day. ForeCare, a fixed annuity with long-term care benefits, can help protect your retirement finances against the unexpected.*

Watch our sales team in this video explain how ForeCare works and what it has to offer your clients.

 

 

*ForeCare is for non-qualified funds only.

1This is called the ForeCare Multiplier (for non-qualified funds only): it provides two or three times (depending on underwriting eligibility) the amount of contract value in long-term care coverage to spend on qualified long-term care expenses. Benefits are subject to a maximum monthly benefit. The additional coverage in excess of the Contract Value is only available to use for a qualified long-term care benefit and will not become part of the contract value or the death benefit. Withdrawals, other than for qualified long-term care expenses, will adversely affect the amount of coverage for long-term care benefits in the future. Note: California policies apply the multiplier to the initial premium net of any optional benefit charges, and not the current contract value.

Preparing for that 70% chance

The odds of a 65 year-old eventually needing long-term care is 70%.3 And LTC can be expensive: a home health aide alone can cost $31,680 a year.4 ForeCare can double or triple your clients’ money for qualified LTC expenses on contract day one.1 For example, a one-time premium payment of $150,000 can mean $300,000 to $450,000 for qualifying LTC expenses.

2To qualify for long-term care benefits you must be diagnosed as chronically ill by a licensed health care practitioner, which means you are severely cognitively impaired requiring substantial assistance to protect against threats to health and safety or are unable to perform at least two of the six Activities of Daily Living (ADLs).

3https://longtermcare.acl.gov/the-basics/how-much-care-will-you-need.html

4"Cost of Care," https://longtermcare.acl.gov/costs-how-to-pay/costs-of-care.html. Costs are based on 12, 30-day monthly periods at four hours a day.

No medical exam. Just 30 minutes on the phone

ForeCare streamlines the application process:

  • The average ForeCare application process takes 30 minutes.
  • There’s no medical exam. Your clients simply need to meet the height and weight requirements and answer questions about their medical history to find out if they qualify and are approved at:
    • The standard level (2X): Provides double the amount of the contract value for qualified long-term care expenses.
    • The premier level (3X): Provides triple the amount of the contract value for qualified long-term care expenses.
  • Some applicants may be asked to participate in a simple memory and logic exercise via a 15-minute phone call.

Legacy and tax advantages

What's unused gets passed on

Unlike a traditional long-term care product, with ForeCare, any remaining contract value not used for long-term care expenses (or withdrawn for other purposes) can be passed to beneficiaries as a death benefit.

A potentially federal income tax-free LTC strategy

With ForeCare, customers typically pay no federal income tax if the money is used for qualifying LTC expenses.

Legacy and tax advantages

Legacy and tax advantages

What's unused gets passed on

Unlike a traditional long-term care product, with ForeCare, any remaining contract value not used for long-term care expenses (or withdrawn for other purposes) can be passed to beneficiaries as a death benefit.

A potentially federal income tax-free LTC strategy

With ForeCare, customers typically pay no federal income tax if the money is used for qualifying LTC expenses.

*This is called the ForeCare Multiplier (for non-qualified funds only). It provides two or three times (depending on underwriting eligibility) the amount of contract value (initial premium in CA) in long-term care coverage to spend on qualified long-term care expenses. Benefits are subject to a maximum monthly benefit. The additional coverage in excess of the Contract Value is only available to use for a qualified long-term care benefit and will not become part of the contract value or the death benefit. Withdrawals, other than for qualified long-term care expenses, will adversely affect the amount of coverage for long-term care benefits in the future. This example assumes the optional inflation and nonforfeiture riders are not purchased. Note: California policies apply the multiplier to the initial premium, and not the current contract value.

ForeCare: the facts

Product description Single-premium, tax-deferred annuity with qualified long-term care benefits, for non-qualified funds only.
Issue ages5,6 Ages: Insured 50-80, Owner/Annuitant 0-85. Ownership may be single or joint, insured must be the owner and/or the owner’s spouse.6 If the Owner is not a living person, then the Owner must be a Grantor Trust and the Insured(s) must be the grantor or Spouse of the grantor. If the Owner is not a living person, an Insured must be the Annuitant or the Spouse of the Annuitant.
Premium amount7
  • Single $35,000–$400,000
  • Joint $35,000–$600,000
(state variations may apply)
Current interest rates Guaranteed fixed interest rate declared annually on the contract anniversary.
Guaranteed minimum interest rates The declared interest rate is guaranteed never to be less than 1% during the Withdrawal Charge Period (0.10% thereafter).
Tax advantages
  • Tax-deferred growth
  • Benefits received for qualified long-term care expenses are typically federal income tax-free8
Benefits
  • Rider for Long-Term Care benefits9
  • Optional nonforfeiture benefit10
  • Optional Inflation Protection benefit10
Simplified underwriting Completed at point of sale.
Coverage care Home Care, Home Health Aide, Homemaker Services, Chore Services, Nurse and Therapist, Personal Care, Respite Care, Adult Day Care, Assisted Living Facility, Bed Reservation, Nursing Home Facility, and Hospice Care.
Long-term care benefits

The ForeCare Multiplier provides two or three times (depending on underwriting eligibility) the amount of contract value in long-term care coverage to spend on qualified long-term care expenses. Benefits are subject to a maximum monthly benefit. The additional coverage in excess of the Contract Value is only available to use for a qualified long-term care benefit and will not become part of the contract value or the death benefit. Withdrawals, other than for qualified long-term care expenses, will adversely affect the amount of coverage for long-term care benefits in the future. An Accelerated Benefit is paid first from the contract value until exhausted, at which point the Extended Benefit takes effect. Qualified expenses are paid by reimbursement.

Single Life
Rating Total duration Accelerated benefit Extended benefit
Standard 72 months 36 months 36 months
Premier 72 months 24 months 48 months
 
Joint Life6
Rating Total duration Accelerated benefit Extended benefit
Standard 84 months 42 months 42 months
Premier 90 months 30 months 60 months
Fees and additional considerations There is a monthly benefit fee associated with the long-term care protection that ForeCare provides. Client’s realized crediting return will be less than the declared interest rate due to the fee. However, even after deduction of the benefit fee, the contract value at month end will not be less than the contract value at the prior month end, less any applicable withdrawals.
Death benefit Any contract value not used for long-term care expenses can be passed to your beneficiaries as a death benefit.
Benefit qualification To qualify for benefits, receipt of proof is required from a licensed health care practitioner stating your client is chronically ill and incapable of performing, without substantial assistance, two Activities of Daily Living (ADLs) for at least 90 days, and/or your client has a cognitive impairment that requires substantial supervision. The ADLs include: Bathing, Continence, Dressing, Eating, Using a Toilet, Transferring/Mobility. Covered Long-Term Care Services must be provided in conjunction with a written Plan of Care submitted by a Licensed Health Care Practitioner, and approved by Forethought Life Insurance Company.
Elimination period 90 days of covered care within 270 consecutive days, waived for home health care with qualifying plan of care.
Waiting period None.
Withdrawal charges 9-year schedule: 8%, 8%, 7%, 6%, 5%, 4%, 3%, 2%, 1%, 0% thereafter (state variations apply).
Free withdrawals 10% of the beginning of year contract value can be withdrawn annually, free of charge. Long-term care benefit claims will reduce this amount. A free withdrawal followed by a complete surrender in the same contract year will result in the above charge being applied to both the amount previously taken as “free”, in that contract year, and the remaining contract value withdrawn (state variations apply). Note: Withdrawals, taken for purposes other than qualified long-term care benefits and Rider for Long-Term Care Benefit costs, will reduce the total amount available for long-term care benefits on a proportionate basis. A tax advisor should be consulted prior to taking withdrawals. If your client withdraws an amount in excess of this Free Withdrawal amount (other than for long-term care benefits and costs), he/she may be subject to Withdrawal Charges and Market Value Adjustments (state variations apply). Withdrawals of taxable amounts are subject to ordinary income tax and may be subject to a 10% federal income tax penalty if taken before age 59 1/2. Cash withdrawals and an elected annuitization option will impact subsequent long-term care benefits.
Market value adjustment (MVA) A Market Value Adjustment, which may be positive or negative, applies during the Withdrawal Charge period to any withdrawals that are subject to withdrawal charges. (state variations may apply).
Free look period Contract may be returned within 30 days for a return of the annuity premium, less withdrawals.

Important Note: Repositioning of assets from an existing product into a ForeCare fixed annuity contract may not be suitable for all clients. Clients should carefully consider factors such as remaining surrender charge schedule, possible market value adjustments and any other charges before determining if repositioning and/or exchanging of an existing annuity contract is right for their particular situation. State insurance replacement regulations may also apply.

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