As a leader in the hybrid long-term care marketplace, with over 30 years of expertise in providing long-term care solutions, Lincoln is committed to innovation and solutions to help meet the changing needs of clients. We’re excited to announce our newest addition to the Lincoln MoneyGuard solutions product portfolio, Lincoln MoneyGuard Fixed Advantage will be available effective May 16, pending state approval.
MoneyGuard Fixed Advantage is a universal life insurance policy with a long-term care rider that preserves the core design features of our current MoneyGuard Universal Life product. Following a transition period, MoneyGuard Fixed Advantage will replace Lincoln MoneyGuard® III in approved states.
With the launch of MoneyGuard Fixed Advantage, we’re excited to introduce the new Benefit Transfer Rider (BTR) that is automatically included with all MoneyGuard Fixed Advantage policies, at no additional cost. This innovative rider provides the opportunity to enhance an existing policy’s long-term care and death benefits through the utilization of death claim proceeds from a separate policy at a rate that will always be greater than the amount being transferred.
Benefit Transfer Rider
Qualifications
The BTR provides beneficiaries the choice of additional flexibility with the option to use some ($25,000 minimum) or all of their death benefit proceeds to enhance benefits on their existing MoneyGuard policy with no additional underwriting requirements. Qualifications to use the BTR are:
- Insured and beneficiary are MoneyGuard policyholders
- The Benefit Transfer Rider is on both policies
- The beneficiary is the insured on their policy
Utilization
At the time of first death claim, the beneficiary has the following choices:
- Take full death benefit income tax-free.
- Use full death benefit to purchase more benefits on their own policy.
- Take partial death benefit income tax-free and use remainder to purchase more benefits on their own policy.
Benefits and Values
Notable features associated with enhancing benefits through the Benefit Transfer Rider include the following:
- Utilization of the BTR will increase existing policy benefits for the following values:
- Long-Term Care Benefits
- Death Benefit
- Surrender Value
- The increase in Long-Term Care and Death Benefit will always be more than the amount of death benefit transferred.
- Increased policy benefits utilizing the BTR will not increase charges on the existing policy and would not require underwriting.
- If inflation exists on the base policy then the BTR long-term care benefits will also grow with inflation.
Distinct Advantages
Distinct advantages to the Benefit Transfer Rider for planning purposes includes:
- No decision until time of claim — Allows clients to make an informed decision based on their unique situation. Can be elected through age 121 and if the beneficiary is on long-term care claim.
- Customizable policies — Personalize to meet individual client’s needs instead of sharing benefits.
- Beyond married couples — Use with couples, siblings, parents and for estate planning.
- Coming soon: Product optionality — Leverage across the MoneyGuard Advantage product suite including MoneyGuard Fixed Advantage and Lincoln MoneyGuard Market Advantage®.
Future Plans
Lincoln is excited to make the Benefit Transfer Rider part of the MoneyGuard Advantage product suite value proposition.
- Later this year and subject to state approval, Lincoln intends to add the Benefit Transfer Rider to our MoneyGuard Market Advantage product.
- Additionally, subject to state approval, MoneyGuard Market Advantage policies placed inforce prior to the addition of the BTR, will have the BTR added to their contracts as part of a supplementary mailing. This mailing would likely occur early next year but will apply to all MoneyGuard Market Advantage policies issued since February 2021.
- There are no plans to add the BTR to other inforce MoneyGuard products at this time
- A registration statement relating to these securities has been filed with the Securities and Exchange Commission. These securities may not be sold until the registration statement becomes effective.
Product Pricing
Maintains the competitive pricing improvements from Lincoln MoneyGuard® III (2021) – 01/10/22.
Flexible Care Cash Enhancement
Flexible Care Cash benefits will now be available for seven days a week (previously limited to five days a week).
The following aspects of Flexible Care Cash remain in place:
- While Specified Amount remains, this feature provides access to cash benefit for care needs.
- Allows for 50% of the maximum daily benefit to be used per occurrence (up to the IRS per diem limit).
- Cash benefit payable without providing receipts.
- Care under this feature may be provided by family members, including the spouse. ▪ Clients have ability to simultaneously use both FCC and reimbursement but are limited to one option per day.
Refreshed Projection of Values
A redesigned Projection of Values will be launched with MoneyGuard Fixed Advantage. Notable items associated with the MoneyGuard Fixed Advantage Projection of Values includes:
- Purposely designed illustration with consumer-friendly language and important values/product features prominently displayed.
- Designed for in-person and virtual presentations.
- Access to a variety of refreshed additional reports enhancing the sales process: What Care Costs Report, Concierge Care Report, Quick Quote Report, Premium Options Report, Policy Expense and Analysis Report and a new Benefit Transfer Rider Report.
- The new additional report for the Benefit Transfer Rider allows for a personalized example of how BTR funding will impact the policy.
Policy Charges
- LTCBR Charge is now level for 10 years
- Premium Load is 25% of all premiums in all years
Availability and Transition Rules
Applications for Lincoln MoneyGuard Fixed Advantage will be accepted beginning on May 16, 2022 in states where approved.
- For applications to qualify for the current MoneyGuard® III (2021) – 01/10/22, a projection of values and the completed Part 1 must be signed, dated, and received in-good-order by Lincoln’s home office by Friday, June 17, 2022.
- For pending or issued MoneyGuard® III business on or after May 16, 2022:
- Lincoln will accept requests with a revised projection of values and the updated Terminal Illness Rider Disclosure to change to MoneyGuard Fixed Advantage. Please note the updated Long-Term Care Insurance Outline of Coverage should be provided to the client.
- Please contact your New Business Team with any requirement or process questions.
- For placed business, normal internal replacement guidelines apply. Rewrites will not be accepted.
- As of May 16, 2022, Lincoln DesignIt and WinFlex will be updated with the new product. During the transition period both products can be run.
- Ensure that you are appropriately credentialed. Clients of advisors who are not properly credentialed to solicit business when the paperwork is submitted will be subject to the product in effect on the date when the advisor becomes properly credentialed and resubmits the paperwork.
- Remember that once an application is submitted, the Personal History Interview (PHI) must be completed within 60 days of submission. In addition, the case must be placed within 90 days of the PHI. If these conditions are not met, the case will be closed out. If a case is reopened, a new Part 1 must be submitted, and the case will be subject to the product available at that time.