bohemia estate planning

CONVERSION OF LIFE INSURANCE DURING LIFE OF COVERED INDIVIDUAL

As this blog discussed in the past, long term planning insurance is something that many consumers are reluctant to purchase for a number of reasons One of the main reasons for this reluctance is the long term cost may not financially justify its utilization. Life insurance companies recognized this problem and started to allow for a hybrid financial product in their life insurance policies. The life insurance company allows for the conversion of a life insurance policy to pay for the long term care services.

The animating philosophy is that there will be a pay out regardless of whether or not it happens during the insured’s lifetime, so the life insurance company could just as easily pay out on the policy during the insured’s life. Every day over 10,000 baby boomers turn 65, so the population base that could potentially utilize such as a product is growing larger every day. It is estimated that at least 70 percent of the baby boomer population will need some sort of long term care during their lifetime, with 40 percent in need of nursing home treatment.

In today’s society it is common, to say the least, to have a single parent household. Most of the time the parents are divorced or simply not together and one of the parents is less hands on than the other. Perhaps this is a because of distance, as the other parent may live quite some distance away or perhaps due to work obligations and can only physically parent a month or two out of the year. Then there are truly single parents insofar as the other parent has passed away or perhaps the other parent is just not in the picture for any number of reasons or there is a history of domestic violence and the other parent’s custodial rights are extremely curtailed.

For this population, their will serves not only to memorialize how they want their possessions and property to be disposed of, it also allows for them to indicate who they want to take custody of their children. To be sure, if the other parent is named as the father/mother to the child and the primary custodian passes away, the other parent has the legal authority to take custody, absent good cause. There are, however, other ways of addressing these concerns outside of the four corners of the primary custodians will. Enter the standby guardianship which was specifically designed in response to such situations.

SUPERIOR TO CUSTODY ORDER

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