Critical Illness Insurance

One very important and most often overlooked form of insurance is Critical Illness coverage. CI coverage offers a lump sum payment and reimbursement payments for covered critical illnesses. They often include cancers, multiple sclerosis, heart disease, paralysis, kidney failure, loss of two or more limbs, blindness (and sometimes even more conditions.) CI coverage is a vital tool in covering the gaps of other forms of insurance. These are gaps that we do not realize exist until it is usually too late. For example, most employer based health insurance policies or HMO's cover treatments inside a PPO or preferred provider network. But what do you do if you are advised to leave your network or search for "out-of-network" care for highly specialized or experimental cancer treatment? (A situation that can easily arise, if cancer is diagnosed.) This is an example of a major gap that we are seeing all too often in the industry. Another example is the the gap between your disability coverage and your need for care. Disability coverage is designed to be only a percentage of your total salary , to encourage a speedy return to work. But what do you do if you are disabled due to a critical illness and you have added cost of care due to the illness?
Critical illness coverage is a vital tool in protecting your financial and medical future. For pennies on the dollar the financial risk of a critical illness can be passed to a major "A" grade or better insurance carrier. There are return of premium riders that can return the premiums that you pay for this coverage at age 65 when you begin medicare coverage. You can also choose to keep the coverage after 65 to expand your options of care providers (outside Medicare) in the event that a critical illness arises.

Long Term Care Insurance

Long term care insurance is right for people who have assets to protect. Those assets include, retirement savings of all forms, cash, life insurance cash value, homes, cars and anything that can be sold for value. (IE. jewelry, etc) If you have any of the above then you should consider long term insurance. The risk of paying for your long term healthcare should be passed to an insurance company. In long term care planning you will need spend down most of your assets you worked your whole life to accumulate before Medicaid will pay for your care. The current look back period for Medicaid qualification is 5 years. Also, your family should be able to choose the facility and type of care you receive. As with all insurance, the longer that you wait, the more expensive it can be. Contact us for a free quote and consultation. (If you have had health challenges , then new changes to the Pension Protection Act will allow for a linked benefit annuity to payout for care in a long term healthcare facility.)

Guaranteed Universal Life Insurance

Guaranteed Universal Life Insurance or GUL's are universal life policies that offer a guaranteed death benefit for a specific set premium. The death benefit is guaranteed for the time period set forth in the contract, usually to a specific age or maturity date. As long as the policy holder pays the premiums as scheduled, the contract is guaranteed not to lapse. Usually, these contracts are designed not build cash value. The premiums for GUL's is very low when compared to whole life or traditional Universal Life policies. They are a perfect fit for someone who is just looking for coverage. For more information or a free quote, contact us, we can have the information sent out to you.

Fixed Annuity vs CD's

Please see below for a great analysis on the fixed annuity and interest rate environment. These numbers show the benefits of purchasing a fixed annuity now for those clients of yours looking at fixed options. With clients thinking the interest rate environment will increase, many of them are holding off their annuity purchases until rates climb. See below on how to overcome this objection.

It’s All Relative

Last year we had plenty of 5% annuities available and annuity sales were at an extreme high. CD rates at the same time were at 4%. See the table below;

2009 Rates	Rate
Annuity	5%
CD	4%
Difference in Rate	25% in favor of the annuity

As you can see from the above, annuity rates still were 25% higher than CDs last year and many clients jumped into their annuity with both feet. Now a year later we see the following;

Current Environment	Rate
Annuity	2.9%
CD	1.82%
Difference in Rate	Over 37% in favor of the annuity

The difference in rates between these two vehicles is dramatically different today. Economists stipulate that the interest rate environment will remain flat until 2012. But, assuming we ignore economists, what would rates have to climb to in order to justify waiting today?

Today we can get 2.9% x 5 years guaranteed with an annuity and without the power of compounding, this equates to 14.5% over 5 years

· If we wait a year we would need to yield 3.62% on a 4 year annuity to equal 14.5% (a 54% increase off today’s 4 year annuities)

· If we wait 2 years we would need a 4.83% rate on a three year annuity to equal 14.5% (a 193% increase off today’s 3 year annuities.

Educating clients and helping them realize the cost of waiting is one of the many services we offer. We can also show you how to guarantee an income stream for life! More to come on that.

Do you know what a split annuity is?

A split annuity is a combination of an immediate income annuity and single premium tax deferred annuity. The immediate annuity guarantees income for a period of time, and the deferred annuity grows with a fixed interest rate while the income is being taken from the immediate annuity. If done correctly, the income is taken while the deferred annuity compounds. At the end of the guaranteed income period, the deferred annuity is ready to be used as the new income vehicle!

What are Accident Expense Policies?

If you have children, you already know how quickly accidents can happen. Occasionally a simple band-aid will not do the trick and a trip to the emergency room may be in order. As a parent, you have first hand experience on how expensive major medical procedures are. Accident expense policies are designed to cover the gaps of major medical deductibles and insurance co-pays, along with rehabilitation associated with an accident. They will usually cover up to $15,000 per incident and can greatly reduce medical insurance premiums by allowing you to increase your deductibles. These plans pay in addition to your current coverages.

We offer a variety of policy options to meet almost any budget. Give us a call today to find out more information on all of our NC insurance programs - 910-343-1554.

New Look for Our Web Site

We are close to finalizing the redesign of our main corporate web site at AarowFinancial.com. For those of you who are unfamiliar with our company, we are an independent insurance agency headquartered in Wilmington, NC that offers life, long term care, and accident and disability insurance policies throughout North Carolina. Our new site if full of information on our carriers' various insurance products. We are currently working on integrating online quoting functionality to better serve the needs of our more tech savvy clientele.

We also are specialize in retirement and savings plans. Whether you are new parent looking for term life insurance protection or someone nearing retirement seeking saving strategies, we can likely help point you in the right direction. Stop by our Market Street location or call us toll free at 800-343-3401.

Please feel free to offer feedback on how we can improve our new web site and thanks again for considering Aaron Financial Group for all of your Wilmington, North Carolina insurance needs.