Purchasing an Immediate Annuity Simple Guidelines for a Smooth Eligibility Process 1234 Enterprise Dr. | De Pere, WI 54115 | t 800.255.1932 | f 805.683.6313 | [email protected]| thekrauseagency.com Original insurance documents are always required. A copy will never suffice, and will not be accepted by the insurance company. It is always recommended that you overnight the documents containing original signatures using a mail carrier that can guarantee overnight delivery and provide a tracking number; applications sent via USPS may not be processed the same day. Always use a cashier’s or bank check if possible. e Krause Agency, Inc. does not have control over when insurance companies cash checks. To ensure that all funds are out of an applicant’s account in a timely manner, take advantage of a cashier’s or bank check. However, personal checks are acceptable if necessary. Forward all correspondence directly to e Krause Agency, Inc. Never send documentation directly to the insurance company, unless specifically requested by the representative that you are working with. Meet the end-of-the-month deadlines. To obtain the issue date required for eligibility, ensure that all documents are forwarded to e Krause Agency, Inc. at least two business days prior to the end of the month. No exceptions. Ensure that the timing of the purchase coincides with all planning variables. e spend-down process isn’t complete until after the annuity is funded. It is the responsibility of the elder law attorney to ensure the timing is correct. Include all supporting documentation. If an attorney-in-fact has completed any paperwork, include the power of attorney documentation. If a trust is referenced within any paperwork, include the certificate of trust. If direct deposit is requested, include a voided check. Double-check all financial figures prior to proceeding. Confirm all figures provided in the most recent planning letter or illustration are current, correct, and coincide with your planning needs. Ensure the state Medicaid agency is designated as a beneficiary (if applicable). If you need assistance in this requirement contact e Krause Agency, Inc. for the proposed beneficiary designation language. It is pertinent that the designations are correct in that they cannot be altered. Disclose any desired issue date or first payment date. In some instances e Krause Agency, Inc. is able to arrange for specific policy dates. Inform e Krause Agency, Inc. of any policy preferences that you may have. Ensure tax status is correct. If the funds have not been taxed before (e.g. an IRA), be sure to designate the same on the application. Providing an incorrect tax status can subject your client to costly income tax consequences.
Transcript
Purchasing an Immediate AnnuitySimple Guidelines for a Smooth Eligibility Process
1234 Enterprise Dr. | De Pere, WI 54115 | t 800.255.1932 | f 805.683.6313 | [email protected] | thekrauseagency.com
Original insurance documentsare always required.A copy will never suffice, and will not be accepted bythe insurance company. It is always recommended thatyou overnight the documents containing original signatures using a mail carrier that can guaranteeovernight delivery and provide a tracking number; applications sent via USPS may not be processedthe same day.
Always use a cashier’sor bank check if possible.The Krause Agency, Inc. does not have control overwhen insurance companies cash checks. To ensure thatall funds are out of an applicant’s account in a timely manner, take advantage of a cashier’s or bank check. However, personal checks are acceptable if necessary.
Forward all correspondence directlyto The Krause Agency, Inc.Never send documentation directly to the insurance company, unless specifically requested by therepresentative that you are working with.
Meet the end-of-the-month deadlines.To obtain the issue date required for eligibility, ensure that all documents are forwarded to The Krause Agency, Inc. at least two business days prior to the end ofthe month. No exceptions.
Ensure that the timing of the purchase coincides with all planning variables.The spend-down process isn’t complete until after the annuity is funded. It is the responsibility of the elderlaw attorney to ensure the timing is correct.
Include all supporting documentation.If an attorney-in-fact has completed any paperwork, include the power of attorney documentation. If atrust is referenced within any paperwork, include the certificate of trust. If direct deposit is requested,include a voided check.
Double-check all financialfigures prior to proceeding.Confirm all figures provided in the most recentplanning letter or illustration are current, correct,and coincide with your planning needs.
Ensure the state Medicaid agency is designated as a beneficiary (if applicable).If you need assistance in this requirement contact The Krause Agency, Inc. for the proposed beneficiary designation language. It is pertinent that the designations are correct in that they cannot be altered.
Disclose any desired issuedate or first payment date.In some instances The Krause Agency, Inc. is ableto arrange for specific policy dates. Inform TheKrause Agency, Inc. of any policy preferences thatyou may have.
Ensure tax status is correct.If the funds have not been taxed before (e.g. an IRA),be sure to designate the same on the application.Providing an incorrect tax status can subject yourclient to costly income tax consequences.
The processing fee paid to The Krause Agency, Inc. is not a guarantee that an application for VA/Medicaid benefits will be approved. None of the aforementioned processing fees will be paid to third parties. If an outside insurance agent and/or financial advisor is involved in the case of a short-term annuity and he or she expects to be compensated the insurance agent and/or financial advisor is responsible for charging his or her own processing fee - no compensation will be provided by way of The Krause Agency, Inc. All processing fees provided to The Krause Agency, Inc. are non-refundable. Furthermore, no inference is to be drawn that any of the insurance products provided by The Krause Agency, Inc. have been reviewed or approved by any state Medicaid office. The Krause Agency, Inc. reserves the right to alter this fee schedule at any time. Effective 1/1/15.
Processing fees apply on an aggregate basis — not per annuity. Please make processingfees payable to The Krause Agency, Inc. Processing fees are non-refundable.
Policy Owner Name:
Applicable Processing Fee:
Representative Signature:(Can be policy owner, authorized representative, attorney, or writing agent.)
Date:
No FeeNo Fee
72+ Months 60+ Months
ELCO and CFU
Short-Term Immediate Annuities
All Other Carriers
2–47 Months
Premium $99,999 or lessFee is $1,250
Premium$100,000–$499,999
Fee is 1.75%
Premium$500,000+
Fee is 2.00%
Premium $99,999 or lessFee is $1,250
Premium$100,000–$499,999
Fee is 1.75%
Premium$500,000+
Fee is 2.00%
48–71 Months
Premium$34,999 or less
Fee is $750
Premium$35,000+
No Fee
Less than 60 Months
2015ProceSSIng Fee Receipt
1234 Enterprise Dr. | De Pere, WI 54115 | t 800.255.1932 | f 805.683.6313 | [email protected] | thekrauseagency.com
Single Premium Individual 916 Sherwood Drive Lake Bluff, Illinois 60044-2285 Immediate Annuity Application 1-800-321-ELCO Please print in dark ink.
1. Proposed Annuitant:
Name: _________________________________________________________________ Date of Birth: _______________________________________
Sex: ________ Social Security #: ___________________________________________ Phone: ____________________________________________
4. Plan: Single Premium Individual Immediate Annuity 1 . Single Life: Life Only Life with Period Certain _______ Years (Options: 5, 10, 15, 20 years.)
2. Single Life-Fixed Benefit: Level Benefit Balloon Style Benefit Period ________ Months Years
3. Joint Life: Joint Life Only Joint Life with Period Certain ________Years (Options: 5, 10, 15, 20 years.)
4. Joint Life-Fixed Benefit: Level Benefit Benefit Period ________ Months Years Percent to Survivor_________%
Mode of Annuity Payments: Monthly Annual (For annual mode, benefit period must be in whole years.)
Annuity Commencement Date: 1 month, 1 year_____, after Effective Date
Annuity Due (first annuity payment check accompanies the contract.)
Plan Qualification: Non-Qualified Tax–Deferred IRA Tax-Deferred Roth IRA (The company will not accept tax-qualified joint-life plans other than with spouses.)
Single Premium submitted with this application: $_____________________________*
* Make Checks Payable to: ELCO MUTUAL LIFE AND ANNUITY. Do NOT pay to agent or leave payee blank. 5. Beneficiary: List name, address and relationship .
Single Premium Individual Immediate Annuity Application (Continued)
7. Replacement: (If other policies/certificates exist, list name of company(s) and policy number(s) in Remarks Section.)
Does the Annuitant or Co-Annuitant, if any, have an existing life insurance or annuity contract? Yes No. Will the plan now applied for replace or change any existing life insurance or annuity contract? Yes No.
Any person who knowingly presents a false statement in an application for insurance may be guilty of a criminal offense and subject to penalties under state law. The undersigned: (1) REPRESENT that the information shown in this application is, to the best of their knowledge and belief, complete and true; (2) AGREE that this application shall be the basis for and a part of any contract issued; and (3) UNDERSTAND that: (A) the contract will be effective on the date the Company approves issue of the contract or the date of its receipt of the premium for the contract; and (B) only an officer of the Company may, in writing: (a) make or modify contracts; or (b) waive any of the Company’s rights or requirements.
Does the proposed annuitant have existing life insurance or annuity contracts? Yes. No. Do you have knowledge or reason to believe that replacement of existing life insurance or annuity contracts may be involved? Yes. No. I Attest that I have witnessed all signatures. Application signed at (City/State): ___________________________________________________________
PROXY Do you hereby constitute and appoint the proxy committee of ELCO Mutual Life and Annuity, as established in the bylaws, as your lawful attorney and proxy and in your name and stead hereby authorize and empower it to cast your vote at any meeting of the policyholders of the company? This proxy shall continue in force except when you are present in person or revoke it by giving the company written notice in accordance with the ELCO Mutual Life and Annuity bylaws. Answer: Yes. No. _______________________________________ ____________________________________ Proposed Owner’s Signature Date
PROXY 2002
Owner’s Signature, if other than annuitant(s):_____________________________________ Date: ______________________________
916 Sherwood Drive Lake Bluff, Illinois 60044-2285 847-295-6000 800-321-ELCO
ANNUITY SALE SUITABILITY DISCLOSURE
Your state law requires that any person who may be considering the purchase of an annuity contract must be given the opportunity to provide information concerning his or her financial condition to the agent selling the contract. The information given will be used to determine if the proposed annuity contract is appropriate for your financial circumstances. You may decline to provide this information, but in so doing, you take full responsibility in determining whether the proposed annuity contract is suitable for you. By signing, you acknowledge your understanding that an annuity is generally a long-term investment and that withdrawals may be subject to charges.
Part 1
Client Name:_________________________________ Age:_____ Amount of Proposed Annuity:$_______________
YES, I agree to answer the questions below and I understand that any recommendations assume the information provided is both current and accurate. Please answer questions 1 - 9, sign and date the form below.
NO, I will not answer the questions below and I take full responsibility for determining whether the proposed annuity is suitable for me. Please sign and date this form below.
1. Estimated annual income: $_______________. Sources of income: _____________________________________
2. Are your currently retired? Yes No. If no, in what year do you plan to retire? ___________
3. My estimated net worth (assets less liabilities): $_______________. My tax bracket:___________%
4. My investment risk style: Conservative Moderate Aggressive
5. Which of the following describes your long-term objectives for this annuity? Check all that apply. Supplemental Retirement Income Minimum Crediting Guarantees Safety of Premium Protection for my Beneficiaries Tax-Deferred Growth (non-qual.) Guaranteed Income for Life
6. The source of funds to purchase this annuity is:______________________________________________________
7. If this policy is a replacement, an exchange, or is paid for with money from another contract, I believe the purchase of this annuity will better meet my financial needs. Yes No N/A
8. Percentage of proposed annuity to estimated net worth ________%. (If more than 50%, sale would not meet company guidelines. If client wants annuity upon being so advised, complete Part 2 below.)
9. During the term of the annuity contract, do you expect to need more than the free withdrawals of interest and the free annual withdrawals or, with an immediate annuity, do you expect to need more than the scheduled annuity payments as proposed to you? Yes No. (If yes, sale would not meet company guidelines. If client wants annuity upon being so advised, complete Part 2 below.)
I represent that the answers to the above questions are correct to the best of my knowledge and will be used in evaluating the suitability of any annuity contract that may be proposed to me. I understand my answers are voluntary.
Date ____________________________ Client Signature ___________________________________________
Part 2 (See Questions 8 & 9) I have been advised by my agent that the annuity proposed to me is not suitable according to established Company guidelines, but having considered the matter fully, I nevertheless desire to purchase the amount of the annuity proposed to me. I take full responsibility for determining whether the proposed annuity is suitable for me.
Date ____________________________ Client Signature ___________________________________________
Producer’s Statement: I have reasonable grounds for believing that the recommendations for this consumer to purchase/exchange or replace an annuity is suitable on the basis of the facts disclosed by the client as to their current investments, financial situation, and needs.
Date ____________________________ Producer’s Signature _______________________________________
ASCD Ed. 10/13
916 Sherwood Drive Lake Bluff, Illinois 60044-2285 847-295-6000 800-321-ELCO
Annuity Sale Disclosure
This acknowledges that on the date shown below an application has been completed for an annuity contract with
ELCO Mutual Life and Annuity. I understand the following items pertinent to the proposed contract:
The proposed Owner should initial all items
For Single Premium Immediate Annuities: _________ It is understood that this policy will provide periodic payments for one of the following options Initial as applied for: a) the annuitant’s lifetime with or without a certain number of payments guaranteed; b)
the joint lifetime of the annuitant and co-annuitant with or without a certain number of payments guaranteed; or c) a specified fixed period. Payment amounts will be specified in the policy.
_________ It is understood that once payments have begun, no cash surrender of the policy is possible. Initial _________ It is understood that any guaranteed periodic payments remaining unpaid at the annuitant’s death will Initial continue to the beneficiary(s) listed in the application. Signed at _______________________________________ on __________________________________________ City, State Date
This is an authorization agreement for automatic deposit (ACH Credits). I hereby authorize ELCO Mutual Life and Annuity to initiate credit entries directly into my account identified below at the depository financial institution. I acknowledge that the origination of ACH transactions to my account must comply with the provisions of U.S. law. Checking Account Savings Account (Bank must be a member of ACH) Bank Name: Routing Number: Account Number:
If monies to which I am not entitled are deposited to my account, I authorize ELCO Mutual Life and Annuity to direct the financial institution to return said funds. This authority will remain in effect until I have filed a new authorization, or until revoked by me in writing or upon termination of my contract with ELCO Mutual Life and Annuity.
Print Name: ELCO Policy Number:
Signature:
Date:
Staple, in this box, a VOIDED check for the account indicated above.
Return this completed form to ELCO Mutual Life and Annuity
Form W-4PDepartment of the Treasury Internal Revenue Service
Withholding Certificate for Pension or Annuity Payments
OMB No. 1545-0074
2015Purpose. Form W-4P is for U.S. citizens, resident aliens, or their estates who are recipients of pensions, annuities (including commercial annuities), and certain other deferred compensation. Use Form W-4P to tell payers the correct amount of federal income tax to withhold from your payment(s). You also may use Form W-4P to choose (a) not to have any federal income tax withheld from the payment (except for eligible rollover distributions or payments to U.S. citizens delivered outside the United States or its possessions) or (b) to have an additional amount of tax withheld.
Your options depend on whether the payment is periodic, nonperiodic, or an eligible rollover distribution, as explained on pages 3 and 4. Your previously filed Form W-4P will remain in effect if you do not file a Form W-4P for 2015.
What do I need to do? Complete lines A through G of the Personal
Allowances Worksheet. Use the additional worksheets on page 2 to
further adjust your withholding allowances for itemized deductions, adjustments to income, any additional standard deduction, certain credits, or multiple pensions/more-than-one-income situations. If you do not want any federal income tax withheld (see Purpose, earlier), you can skip the worksheets and go directly to the Form W-4P below.Sign this form. Form W-4P is not valid unless you sign it.Future developments. The IRS has created a page on IRS.gov for information about Form W-4P and its instructions, at www.irs.gov/w4p. Information about any future developments affecting Form W-4P (such as legislation enacted after we release it) will be posted on that page.
Personal Allowances Worksheet (Keep for your records.)A Enter “1” for yourself if no one else can claim you as a dependent . . . . . . . . . . . . . . . . A
B Enter “1” if: {• You are single and have only one pension; or• You are married, have only one pension, and your spouse has no income subject to withholding; or . . . . . . . . . . . • Your income from a second pension or a job or your spouse’s pension or wages (or the total of all) is $1,500 or less.
} B
C Enter “1” for your spouse. But, you may choose to enter “-0-” if you are married and have either a spouse who hasincome subject to withholding or more than one source of income subject to withholding. (Entering “-0-” may help you avoid having too little tax withheld.) . . . . . . . . . . . . . . . . . . . . . . . . . C
D Enter number of dependents (other than your spouse or yourself) you will claim on your tax return . . . . . D
E Enter “1” if you will file as head of household on your tax return . . . . . . . . . . . . . . . . . E
F Child Tax Credit (including additional child tax credit). See Pub. 972, Child Tax Credit, for more information.• If your total income will be less than $65,000 ($100,000 if married), enter “2” for each eligible child; then less “1” ifyou have two to four eligible children or less “2” if you have five or more eligible children.• If your total income will be between $65,000 and $84,000 ($100,000 and $119,000 if married), enter “1” for eacheligible child . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . F
G Add lines A through F and enter total here. (Note. This may be different from the number of exemptions you claim on your tax return.) G
For accuracy, complete all worksheets that apply.
{ • If you plan to itemize or claim adjustments to income and want to reduce your withholding, see the Deductions and Adjustments Worksheet on page 2. • If you are single and have more than one source of income subject to withholding or are
married and you and your spouse both have income subject to withholding and your combined income from all sources exceeds $50,000 ($20,000 if married), see the Multiple Pensions/More-Than-One-Income Worksheet on page 2 to avoid having too little tax withheld.
• If neither of the above situations applies, stop here and enter the number from line G on line 2 of Form W-4P below.
Separate here and give Form W-4P to the payer of your pension or annuity. Keep the top part for your records.
Form W-4PDepartment of the Treasury Internal Revenue Service
Withholding Certificate for Pension or Annuity Payments
For Privacy Act and Paperwork Reduction Act Notice, see page 4.
OMB No. 1545-0074
2015Your first name and middle initial Last name Your social security number
Home address (number and street or rural route)
City or town, state, and ZIP code
Claim or identification number (if any) of your pension or annuity contract
Complete the following applicable lines.
1 Check here if you do not want any federal income tax withheld from your pension or annuity. (Do not complete line 2 or 3.) 2 Total number of allowances and marital status you are claiming for withholding from each periodic pension or
annuity payment. (You also may designate an additional dollar amount on line 3.) . . . . . . . . . . . (Enter number of allowances.)Marital status: Single Married Married, but withhold at higher Single rate.
3 Additional amount, if any, you want withheld from each pension or annuity payment. (Note. For periodic payments, you cannot enter an amount here without entering the number (including zero) of allowances on line 2.) . . . . $
Your signature Date
Cat. No. 10225T Form W-4P (2015)
Form W-9(Rev. December 2014)Department of the Treasury Internal Revenue Service
Request for Taxpayer Identification Number and Certification
Give Form to the
requester. Do not
send to the IRS.
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2.
1 Name (as shown on your income tax return). Name is required on this line; do not leave this line blank.
2 Business name/disregarded entity name, if different from above
3 Check appropriate box for federal tax classification; check only one of the following seven boxes:
Individual/sole proprietor or single-member LLC
C Corporation S Corporation Partnership Trust/estate
Limited liability company. Enter the tax classification (C=C corporation, S=S corporation, P=partnership)
Note. For a single-member LLC that is disregarded, do not check LLC; check the appropriate box in the line above for the tax classification of the single-member owner.
Other (see instructions)
4 Exemptions (codes apply only to certain entities, not individuals; see instructions on page 3):Exempt payee code (if any)
Exemption from FATCA reporting
code (if any)(Applies to accounts maintained outside the U.S.)
5 Address (number, street, and apt. or suite no.)
6 City, state, and ZIP code
Requester’s name and address (optional)
7 List account number(s) here (optional)
Part I Taxpayer Identification Number (TIN)
Enter your TIN in the appropriate box. The TIN provided must match the name given on line 1 to avoid backup withholding. For individuals, this is generally your social security number (SSN). However, for a resident alien, sole proprietor, or disregarded entity, see the Part I instructions on page 3. For other entities, it is your employer identification number (EIN). If you do not have a number, see How to get a TIN on page 3.
Note. If the account is in more than one name, see the instructions for line 1 and the chart on page 4 for guidelines on whose number to enter.
Social security number
– –
orEmployer identification number
–
Part II Certification
Under penalties of perjury, I certify that:
1. The number shown on this form is my correct taxpayer identification number (or I am waiting for a number to be issued to me); and
2. I am not subject to backup withholding because: (a) I am exempt from backup withholding, or (b) I have not been notified by the Internal Revenue Service (IRS) that I am subject to backup withholding as a result of a failure to report all interest or dividends, or (c) the IRS has notified me that I am no longer subject to backup withholding; and
3. I am a U.S. citizen or other U.S. person (defined below); and
4. The FATCA code(s) entered on this form (if any) indicating that I am exempt from FATCA reporting is correct.
Certification instructions. You must cross out item 2 above if you have been notified by the IRS that you are currently subject to backup withholding because you have failed to report all interest and dividends on your tax return. For real estate transactions, item 2 does not apply. For mortgage interest paid, acquisition or abandonment of secured property, cancellation of debt, contributions to an individual retirement arrangement (IRA), and generally, payments other than interest and dividends, you are not required to sign the certification, but you must provide your correct TIN. See the instructions on page 3.
Sign Here
Signature of
U.S. person Date
General InstructionsSection references are to the Internal Revenue Code unless otherwise noted.
Future developments. Information about developments affecting Form W-9 (such as legislation enacted after we release it) is at www.irs.gov/fw9.
Purpose of Form
An individual or entity (Form W-9 requester) who is required to file an information return with the IRS must obtain your correct taxpayer identification number (TIN) which may be your social security number (SSN), individual taxpayer identification number (ITIN), adoption taxpayer identification number (ATIN), or employer identification number (EIN), to report on an information return the amount paid to you, or other amount reportable on an information return. Examples of information returns include, but are not limited to, the following:
• Form 1099-INT (interest earned or paid)
• Form 1099-DIV (dividends, including those from stocks or mutual funds)
• Form 1099-MISC (various types of income, prizes, awards, or gross proceeds)
• Form 1099-B (stock or mutual fund sales and certain other transactions by brokers)
• Form 1099-S (proceeds from real estate transactions)
• Form 1099-K (merchant card and third party network transactions)
• Form 1099-A (acquisition or abandonment of secured property)
Use Form W-9 only if you are a U.S. person (including a resident alien), to provide your correct TIN.
If you do not return Form W-9 to the requester with a TIN, you might be subject to backup withholding. See What is backup withholding? on page 2.
By signing the filled-out form, you:
1. Certify that the TIN you are giving is correct (or you are waiting for a number to be issued),
2. Certify that you are not subject to backup withholding, or
3. Claim exemption from backup withholding if you are a U.S. exempt payee. If applicable, you are also certifying that as a U.S. person, your allocable share of any partnership income from a U.S. trade or business is not subject to the withholding tax on foreign partners' share of effectively connected income, and
4. Certify that FATCA code(s) entered on this form (if any) indicating that you are exempt from the FATCA reporting, is correct. See What is FATCA reporting? on page 2 for further information.
Cat. No. 10231X Form W-9 (Rev. 12-2014)
916 Sherwood Drive Lake Bluff, Illinois 60044-2285 847-295-6000 800-321-ELCO
IRA / ROTH IRA Fact Sheet
(MUST BE COMPLETED and submitted with each IRA / Roth IRA Application)
The proposed contract owner, __________________________________________________, has applied for an ELCO Annuity Contract. To ensure that the correct IRS qualification is applied to the annuity contract the following information is required for all IRA and all Roth IRA Annuity applications.
1. Qualification
The annuity applied for is (please check one appropriate box):
a. Traditional IRA (Individual Retirement Account). Complete Sections 2 and 3 b. Roth IRA. Complete information regarding Roth account and Sections 2 and 3. Date of existing ROTH IRA Inception: Create new ROTH IRA
2. Source Of Funds
`
Current Year Contribution Transfer From Another Company Rollover Prior Year Contribution (For contributions made Jan 1st-April 15th)
3. Signature and Acknowledgement
The above statements are true to the best of my knowledge and belief.
Printed Name of Annuitant/Owner
Signature of Annuitant/Owner Date
916 Sherwood Drive Lake Bluff, Illinois 60044-2285 888-872-7954
Page 1 of 3 Home Office Copy – Return This Copy to ELCO Form RNLIA ED 1/2014
IMPORTANT NOTICE REPLACEMENT OF LIFE INSURANCE OR ANNUITIES This document must be signed by the applicant and the agent, if there is one, and a copy left with the applicant You are contemplating the purchase of a life insurance policy or annuity contract. In some cases this purchase may involve discontinuing or changing an existing policy or contract. If so, a replacement is occurring. Financed purchases are also considered replacements. A replacement occurs when a new policy or contract is purchased and, in connection with the sale, you discontinue making premium payments on the existing policy or contract, or an existing policy or contract is surrendered, forfeited, assigned to the replacing insurer, or otherwise terminated or used in a financed purchase. A financed purchase occurs when the purchase of a new life insurance policy involves the use of funds obtained by the withdrawal or surrender of or by borrowing some or all of the policy values, including accumulated dividends, of an existing policy, to pay all or part of any premium or payment due on the new policy. A financed purchase is a replacement. You should carefully consider whether a replacement is in your best interest. You will pay acquisition costs and there may be surrender costs deducted from your policy or contract. You may be able to make changes to your existing policy or contract to meet your insurance needs at less cost. A financed purchase will reduce the value of your existing policy and may reduce the amount paid upon the death of the insured. We want you to understand the effects of replacements before you make your purchase decision and ask that you answer the following questions and consider the questions in this form. 1. Are you considering discontinuing making premium payments, surrendering, forfeiting, assigning to the insurer, or
otherwise terminating your existing policy or contract? ________YES ________NO 2. Are you considering using funds from your existing policies or contracts to pay premiums due on the new policy or
contract? ________YES ________NO
If you answered “Yes” to either of the above questions, list each existing policy or contract you are contemplating replacing (including the name of the insurer, the contract or policy number, if available, the insured or annuitant name) and whether each policy or contract will be replaced or used as a source to finance the new ELCO policy:
INSURER CONTRACT OR INSURED OR REPLACED (R) OR NAME POLICY # ANNUITANT NAME FINANCING (F)
916 Sherwood Drive Lake Bluff, Illinois 60044-2285 888-872-7954
Page 2 of 3 Home Office Copy – Return This Copy to ELCO Form RNLIA ED 1/2014
Make sure you know the facts. Contact your existing company or its agent for information about the old policy or contract. If you request one, an in-force illustration, policy summary or available disclosure documents must be sent to you by the existing insurer. Ask for and retain all sales material used by the agent in the sale presentation. Be sure that you are making an informed decision. The existing policy or contract is being replaced because: ________________________________________________________ I certify that the responses herein are, to the best of my knowledge, accurate: Applicant’s Signature and Printed Name Date Telephone Number Agent’s Signature and Printed Name Date
I do not want this notice read aloud to me. ____________________________________________________________________
(Applicant must initial only if they do not want notice read aloud.) A replacement may not be in your best interest, or your decision could be a good one. You should make a careful comparison of the costs and benefits of your existing policy or contract and the proposed policy or contract. One way to do this is to ask the company or agent that sold you your existing policy or contract to provide you with information concerning your existing policy or contract. This may include an illustration of how your existing policy or contract is working now and how it would perform in the future based on certain assumptions. Illustrations should not, however, be used as a sole basis to compare policies or contracts. You should discuss the following with your agent to determine whether replacement or financing your purchase makes sense:
PREMIUMS:
Are they affordable? Could they change? You’re older – are premiums higher for the proposed new policy?
How long will you have to pay premiums on the new policy? On the old policy?
POLICY VALUES:
New policies usually take longer to build cash values and to pay dividends.
Acquisition costs for the old policy may have been paid; you will incur costs for the new one.
What surrender charges do the policies have?
What expense and sales charges will you pay on the new policy? Does the new policy provide more insurance coverage?
916 Sherwood Drive Lake Bluff, Illinois 60044-2285 888-872-7954
Page 3 of 3 Home Office Copy – Return This Copy to ELCO Form RNLIA ED 1/2014
INSURABILITY: If your health has changed since you bought your old policy, the new one could cost you more, or you could be turned down. You may need a medical exam for a new policy. (Claims on most new policies for up to the first two years can be denied based on inaccurate statements. Suicide limitations may begin anew on the new coverage.) IF YOU ARE KEEPING THE OLD POLICY AS WELL AS THE NEW POLICY:
How are premiums for both policies being paid?
How will the premiums on your existing policy be affected? Will a loan be deducted from death benefits?
What values from the old policy are being used to pay premiums? IF YOU ARE SURRENDERING AN ANNUITY OR INTEREST SENSITIVE LIFE PRODUCT:
Will you pay surrender charges on your old contract?
What are the interest rate guarantees for the new contract?
Have you compared the contract charges or other policy expenses? OTHER ISSUES TO CONSIDER FOR ALL TRANSACTIONS:
What are the tax consequences of buying the new policy?
Is this a tax-free exchange? (See your tax advisor.)
Is there a benefit from favorable “grand fathered” treatment of the old policy under the federal tax code?
Will the existing insurer be willing to modify the old policy?
How does the quality and financial stability of the new company compare with your existing company?
![Planned Giving Manager Mini Manager Gift Annuity Manager2) Click Immediate Payment Gift Annuity Proposal.inp, then click [Open] to open the Template. You may see a warning that the](https://static.documents.pub/doc/80x56/5f2010f59d88a72a96296526/planned-giving-manager-mini-manager-gift-annuity-manager-2-click-immediate-payment.jpg)
