Retirement Costs: Healthcare & Living Expenses

Expansion of life insurance benefits to enjoy while alive
Receive full death insurance premiums for chronic diseases

In the age of 100, longevity is no longer an unconditional blessing. Longevity without preparation is actually a risk. In an age where worries about running out of money and getting sick are eating away at retirement, how to protect and utilize retirement assets is a key task for all seniors. In particular, the Korean community has a strong will not to burden their children, so devices that can help them pay for their own care and living expenses are more urgent than ever.

Recently, ‘evolved life insurance’ has been attracting attention in the insurance industry as an answer to this challenge. This is a product that goes beyond the traditional structure of simply paying insurance benefits upon death, and greatly enhances the benefits one can enjoy while alive. The paradigm has changed from ‘insurance that you only receive when you die’ to ‘insurance that you can enjoy while you are alive’.

There are three core structures: First, a 15% bonus is applied immediately upon signing up, and assets are increased with interest linked to the S&P 500 index. If you deposit $100,000, it starts at $115,000. There is a ‘zero floor’ device that protects the principal even when the market plunges, and an ROP (Return of Premium) option that guarantees the principal even when the contract is cancelled, so the principal can be thoroughly protected while expecting higher returns than bank deposits.

Second, when a chronic disease (requiring long-term care) is diagnosed, the entire death compensation can be received in advance as nursing expenses. It is an indemnity method in which cash is paid every month without submitting a receipt, and tax-exempt benefits are also applied. Cash is transferred directly to your bank account with a single medical certificate without complicated billing procedures, making it highly practical in actual caregiving situations.

Third, even if you are healthy, you can convert your death compensation into living expenses over 5 years starting at age 85. It is a key device that solves the age-old concern, ‘If you have insurance but don’t get sick, isn’t it a loss?’ If you are sick, you can inherit nursing expenses, if you are healthy, living expenses, and if neither applies, the entire increased death compensation can be passed on to your family tax-free. In short, it is a ‘no-fuss plan.’

Real cases prove this. A 60-year-old woman who had been rejected for other insurance due to a previous cancer diagnosis deposited $100,000, and as a result, the death compensation at age 88 grew to about $470,000. If you need nursing care, you can receive about $7,900 per month tax-free, and if you are healthy, you can receive the same amount for living expenses. Another 70-year-old customer transferred $210,000 of cash value from an existing insurance policy tax-free through 1035 Exchange, securing approximately $520,000 in coverage at age 88.

This product is a single premium method that deposits a lump sum at once. The barrier to entry is low as you can sign up using CD deposits tied to a bank or the cash value of existing insurance. The age of subscription is limited to 45 to 80 years old, and the health screening is relatively simple, so the door is open to those who were rejected for other insurance due to past medical conditions. However, it is most important not to miss the right time.

▶Inquiries: (213) 448-4246

Monica Kim / Financial Insurance Expert