Almost all newer annuity contracts have a provision in them to allow access to all or most of your funds in the event of a need for a nursing home. The greatest fear of most senior adults is being confined to a nursing home and not being able to live in dignity. Annuity products have a rider that allows for access to your funds to finance this need and almost no one knows they have it in their contract.
For a long time insurance companies have been looked on as insensitive and having all that small print in the contract. But this addition to annuity contracts provides an enormous benefit. And guess what...? There is no extra charge. The benefit is built into the pricing and crediting rate of your annuity!
The language that determines if this benefit is available to you is very straight forward. In the event you are placed in a nursing home for a period of six months and meet the other simple standards which a doctor will attest, the rider comes into effect.
One other benefit that annuities provide is the forfeiture of surrender fees at death. In the event the annuitant passed away prior to the end of a surrender period the full account value of the annuity is paid to the beneficiary. There are a few companies who do not provide this benefit so it is important to ask and to fully understand how the death benefit is calculated. Occasionally contracts are issued with a front end premium bonus and to protect itself the insurance company will require the policy to be kept for the entire surrender period.
These contacts are rare and can be avoided by asking questions prior to purchase. Always be informed prior to purchasing an annuity.
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