Frequently Asked Questions - COVER YOUR FAMILY.net

Affordable Life & Health Insurance Plans

What is life insurance?

Life insurance are funds you save for your family in the event of your death. You make a contract with an insurance company, which promises to provide a certain amount of money (the death benefit) to your family (beneficiaries) upon your death. In return, you pay your premiums, periodic payments to the insurance company. In addition, life insurance can be used as a means of investment or saving.

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Why is it important for me?

Life insurance is always important for anyone, but if you have a spouse, if you’re a parent, if you have an aging loved one who depends on your income, if your retirement savings are not enough to insure your their future, if you have a sizeable estate, if you own a business, if you have bills, a car loan or a mortgage, if your family depends on your income to live, if your income is necessary to maintain the family household and if your dependents may have financial problems if you die, life insurance is necessary for you. The policy’s death benefit can fund your dependents’ needs for a long time after you’re gone.

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Am I making the right decision?

By buying life insurance, you’re making a long-term commitment. That is why it is very important that you know exactly what you’re buying and get the right advice from the people who know about life insurance. Before buying any policy, ask yourself these questions:
If I were to die, what would my children, spouse or dependents need in order to continue living according to the lifestyle you have provided for them?
Do you need income for your retirement?
Do you need to accumulate funds for education?
Do you need an alternative way to pay estate taxes?
How much will you be able to pay for a policy?
Are you buying a safe policy?
Doing some homework is a good idea. Read, ask, and learn about it before you make your decision.

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Can I receive money even if I don’t die?

The accelerated death benefit allows you to collect around 50% of your death benefit to cover unexpected medical expenses or other costs if you become critically ill. The amount you take out while you’re alive will be subtracted from the death benefit payments to your beneficiaries along with an interest charge to account for early payment of benefits.

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What is the difference between term and permanent life insurance?

Term life insurance is the simplest and least expensive type of coverage. The policies do not build a cash value. Coverage is in effect for a fixed period of time, and can be renewed after the initial term. It pays a fixed death benefit upon death.
Permanent life insurance consists of whole life, universal life and variable life insurance. Whole life provides protection with a guaranteed cash value and premiums at a fixed level, building up cash value on a tax-deferred basis. Universal life insurance is a flexible life insurance. The policies vary upon interests and the insured can decide the death benefit and premiums according to his/her needs. The net premium payments earn a guaranteed interest rate. The policy owner also owns the cash value and may withdraw it at any time. Variable life insurance is based on several investment options and the policy owner decides how to invest. The values may accumulate more rapidly but there’s always the risk of the market performing poorly. Here, policy owners may also withdraw the cash value at anytime, although it reduces the death benefit.

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Who are my beneficiaries and how should I name them?

Your beneficiaries are the individuals designated to receive the death benefits from your life insurance policy. In other words, the people you want to protect.
Always have a secondary beneficiary, just in case you outlive your first beneficiary.
Select a specific beneficiary. Let your family receive the benefit directly instead of having your insurance paid to your estate. It is better than to have your insurance paid to your estate. One of the great advantages of life insurance is that it can be paid to your family immediately. If it is payable to your estate, however, it will have to go through probate with the rest of your assets.
Be very specific in wording beneficiary designations. Saying "wife of the insured" could result in an ex-spouse getting the proceeds. Naming specific children may exclude those born later. If your child dies before you, do you want the proceeds to go to that child's children? Changing the beneficiary designation is easy, but you have to remember to do it. Due to the various issues involved, an agent can be an excellent source of information to help you properly set up your beneficiary designation.

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What is the process to follow when the insured dies?

Once proof of the death is submitted, and it is clear that the necessary premiums to keep the policy "in force" were paid to the date of death, the death benefit is paid to the beneficiary or beneficiaries.

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How long does it take to get insured?

You fill out the short application, which will take about 1 hour to complete. Submit the app and wait for a response. It generally takes us about 24 hours to answer your request, but the time it may take you to get insured depends on your policy. Some take longer than others.

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What are the different premium payment options?

There are many alternatives and you may choose the payment option that best suits you. You may pay annually, or monthly, and you may choose the premium that adapts to the coverage you need. Contact your agent for support.

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Can you deduct my premiums from my checking account each month?

Yes. Your premiums can be deducted each month from your checking account. When you complete the form and sign the application you can specify when you want to start the automatic deductions.

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Are annuities for me?

If you want to invest in your future while having a safe way to reduce taxes or decide when to pay them, annuities are for you.

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What is the major advantage of annuities?

Annuities give you and your beneficiaries a guaranteed lifetime income and death benefit protection, with tax-deferred growth, and optional protection benefits.

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Is an annuity safe?

Yes. Only insurance companies can issue annuities, regulated in each state by the Department of Insurance.

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How can I know my annuity balance?

We will provide it on each policy anniversary or whenever you need to know the status of your annuity.

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Will the interests accumulated in my annuity be taxed?

Yes, you will be taxed on the tax-deferred interest. However, you decide when to pay income taxes.

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What fees and taxes apply to annuities?

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Most fixed annuities have no fees when purchased. During the accumulation period, the interests earned on your annuity will not be taxed. As long as the funds remain in the annuity, they preserve their tax – deferred status. But if you decide to make a withdrawal, loan, or access your money before the maturity date, taxes may apply.

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Will my annuity have probate proceedings?

If you nominate at least one beneficiary, other than your estate, the payment of the benefits will not be determined by probate proceedings.

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What happens when the market goes down? Who assumes the risk on my investment’s performance?

Again, it depends on the type of annuity you elect. If you have a fixed annuity, the insurance company assumes the risk because these annuities are credited with a specified interest rate for a specified period of time, and regardless of the fluctuation of rates and the performance of your investment, they will never descend lower than the guaranteed interest rate. However, in variable annuities, you assume the risk. If the performace of your investment is poor, the return on the investment (the annuity) will be less.

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Are annuities similar to IRA’s?

A non-qualified annuity is similar to an IRA because it also grows on a tax deferred basis, although it doesn’t have the same requirements like contributions or withdrawals.

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What is a Variable Annuity?

A Variable Annuity is a long-term investment suitable for retirement savings where you can experience market growth, but also includes risk of loss, including principal. Most variable annuities include many equity investment options, asset allocation programs, and a guaranteed interest or money market option as a safe haven for those times you don't want assets subject to market forces. Variable annuities are securities, so are offered only pursuant to a prospectus. Before investing, carefully consider the investment objectives, risks, fees, and other important information about the contract issuer and underlying investment portfolios.

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What are the main features Variable Annuities offer?

Tax deferral on your earnings.
You are able to invest the annuity assets into stocks rather than fixed income investments
Your beneficiaries can receive the balance remaining in the account in the event of your death.
Plus any guarantees provided in your insurance.

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Where do Variable Annuities invest?

Variable annuities provide investment options with underlying portfolios covering the range of investment risk, including stocks, bonds, money market funds, and guaranteed interest accounts (guaranteed by the insurance company). The return will depend on how well these perform, and include opportunity for growth as well as risk of loss, including principal.

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What does Annuitization mean?

It means you can receive payments for life based on your life expectancy.

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What are the two stages when investing in Variable Annuities?

The accumulation stage: when the premiums are allocated among the investment portfolios - subaccounts - and earnings accumulate.
The distribution stage: when money is withdrawn either as a lump sum or several annuity payment options.

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What aspects should be considered when investing in Variable Annuities?

Liquidity or withdrawals: variable annuities are long term investments so they apply charges for early withdrawals.
Surrender charges: variable annuities have surrender charges, although these decline over the years.
Expenses: variable annuities have mortality and expense risk charges, administrative fees, fund expenses, or additional charges for special features.
Risk: since variable annuities invest in potentially declining markets, the rate of return is not stable. However, variable annuities are regulated by the SEC and the NASD.

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Are Variable Annuities the right way to go?

As with any investment, what’s right for you depends on your stage in life, your investment goals and your unique situation. Before purchasing a Variable Annuity, make sure you are guided by a professional. Also, it is important for you to read and understand the propsectus, to make sure you are making the right decision.

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What if I have an emergency and need access to my money?

10% of premium is available each year without a surrender charge being applied. Withdrawals before age 70 ½ may be subject to tax penalty.

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How often will I get statements?

Quarterly.

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Can I annuitize my account?

Yes. Surrender charge is waived, if the income option selected is 10 years or longer.

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Can I add more money to my Annuity at any time?

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Yes. $50.00 minimum.

Can I have money systematically withdrawn from my account?

Yes. Monthly, quarterly, semi-annual or annual. Systematic withdrawals count as one partial withdrawal per year toward the number of allowed withdrawals. Withdrawals before age 70 ½ may be subject to tax penalty.

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How can I access my account on the OM web site?

www.omfn.com . Just follow the simple website navigation guide.

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What is 403(b) tax-sheltered annuity?

A 403(b) tax-sheltered annuity (TSA) is a long-term retirement savings program offered to employees of certain educational and non-profit organizations. You put money into an annuity contract, and, in exchange, your TSA company agrees to pay you an income in the future. The contributions you make to a TSA contract, as well as your earnings, accumulate on a tax-deferred basis until you begin receiving annuity payments at retirement.

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How does a tax-sheltered annuity (TSA) work?

During your working years, you contribute money to an annuity on a pre-tax basis through payroll deduction. Any growth is tax deferred. When you retire, the savings and earnings from your TSA may be withdrawn to help supplement a comfortable retirement.

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What does tax deferred mean?

Tax deferred means that you postpone paying taxes on the amount you contribute to your TSA and the earnings until you start taking money out of your annuity contract (usually after you retire). The tax-deferred component of a TSA helps you to reduce your current income taxes while you accumulate money for your retirement.

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Who is eligible for a TSA?

You are eligible to participate in a TSA if you work for an organization that offers a 403(b) retirement program, such as:
A public school system (university, elementary, or high school).
Other tax-exempt organizations – qualified under Internal Revenue Code section 501(c)(3). This may include hospitals, zoos, private schools, private colleges and universities, museums, arts organizations, religious organizations, and research and charitable foundations.

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What are the key benefits of saving for retirement with a TSA?

Tax Advantages. A TSA helps reduce your current income taxes in two ways. First, the money you contribute comes out of your salary before taxes – so the full amount you set aside (called the principal) can work for you. Second, any earnings from your principal are also tax deferred – you pay no taxes on the principal or earnings until you begin receiving payments at retirement. Withdrawals from your TSA prior to age 59½ are restricted by tax law and, when permitted, may be subject to a 10% tax penalty in addition to normal income taxes.

The example below shows the benefits of TSA tax deferral versus saving for retirement with after-tax contributions. In the example, when you contribute $4,500 per year ($375 per month) to a TSA, you not only reduce your current taxes, but you also receive an additional $1,260 in take-home pay.

Tax Deferral. Your contributions to your TSA and its earnings can compound over the years, tax deferred.
To see how this works, look at the example below, which shows your $100 biweekly contribution, compounded biweekly at a 5% rate of return for both a tax-deferred and a traditional after-tax savings plan.

The graph illustrates the difference tax-deferred compounding can make over the long-term growth of a tax-deferred savings vehicle. Assumes $100 invested biweekly, a 5% interest rate, and a 28% federal tax rate. Distributions prior to age 59½ may be subject to a 10% tax penalty and other restrictions. The tax-deferred growth amounts show the total value of a tax-deferred investment before deduction of any applicable federal, state, or local income taxes upon distribution, and before deduction of any contract charges.

Tax deferral may be available through a qualified plan without the use of an annuity.

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What are the other benefits of a TSA?

Disciplined Savings. Because you contribute to a TSA through payroll deduction, saving on a regular basis is easy. You determine the amount of money you want to contribute (within certain guidelines), and how often.

Flexible Payout Options. When you reach retirement, you can withdraw your money in a number of ways. One option, income for life, is only offered through an annuity.

Guaranteed Death Benefit. If you die before you begin receiving annuity payments, your beneficiary(ies) will receive the money (minus any loans, charges, or applicable state premium taxes). Note: Death benefit guarantees are supported by the claims-paying ability of the insurance company affiliated with Great American Financial Resources®, Inc., that issues the product(s) you select.

Withdrawals and Loans. The money in your TSA is targeted for retirement, but if you need your money in an emergency, in most cases you do have access to it through a low-interest loan or full or partial withdrawals. Remember, withdrawals before age 59½ are restricted by tax law and, when permitted, may be subject to a 10% tax penalty in addition to normal income taxes. Qualified loans are not taxable unless you default on repayment.
Most annuities have a withdrawal charge in the early years of the annuity contract. This penalty encourages you to leave your money in the contract so that it continues earning the maximum amount possible for your retirement. Withdrawals and loans may reduce the contract value.

Service Credit Purchase. Funds from a TSA plan can be used to buy service credits or to buy back forfeited years of service credits under a state retirement system. This direct transfer can occur at any time, even if before age 59½. There will be no taxes or IRS penalties; however, product surrender charges and/or proportionality (if applicable) will still apply.

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What are the benefits for low-income savers?

Certain lower-income taxpayers are eligible to receive a non-refundable tax credit of up to $1,000 for elective contributions made to TSA plans. The credit is a percentage of the first $2,000 contributed to an IRA, TSA, 401(k) plan, or governmental 457(b) plan. The credit percentage is based on the taxpayer's modified Adjusted Gross Income under the following table:

The income brackets are to be adjusted for inflation annually.

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What restrictions apply to withdrawals?

The money in your TSA is intended for your retirement. Accordingly, withdrawals before age 59½ are restricted by tax law. When permitted, however, withdrawals are fully taxable, and, if made before age 59½, may be subject to a 10% tax penalty. Until you reach age 59½, you can only withdraw your pre-tax contributions and related earnings if you sever employment with your employer, become disabled, incur a hardship (as defined by the IRS), or die, or are a reservist called to active duty before 2008 for 180 days or more or an indefinite period. Earnings cannot be distributed on account of a hardship.

After age 59½, there are no tax-law restrictions on withdrawals, although your employer may impose restrictions if your TSA is part of an employer-sponsored retirement plan.

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How do I make contributions?

Once you decide to contribute to a TSA, you must complete two forms:

An annuity enrollment application.

A salary reduction agreement with your employer.

When you enter into such a salary reduction agreement, your gross salary will be reduced by an amount equal to the contributions you wish to apply to your TSA. Your contribution is deducted automatically from your paycheck.

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When should I begin investing in a TSA?

Now. When you start saving may be as important as how much you save. The example below shows the power of compounding principal and interest, and the impact of time in a tax-deferred annuity. In this example, Karen, Bill, and Chris, all 25 years old, are considering saving $2,000 per year.
Karen decides to begin saving now. She saves for 10 years, then stops. Bill thinks he’s too young to worry about retirement and decides to delay saving until he’s 35, at which point he’ll save until he is 65. Chris decides to start saving now and continue until age 65.

Let’s assume that all three savings programs grow at a 6% rate of return* and have no taxes taken out. Incredibly, in our example, Bill would contribute three times as much as Karen over the years, but he’d retire with only about $7,000 more than Karen. The reason? Karen is starting now. She has compound interest working for her. Chris, of course, is the real winner. By starting now and saving until age 65, Chris would retire with as much as Bill and Karen combined.

*This rate of return is for illustration purposes only and does not represent a particular product. Your results will vary.

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How much can I contribute to a TSA?

As of January 1, 2007, you may contribute up to 100% of your salary, to a maximum of $15,500 per year.* This limit is to be adjusted annually for inflation. Additional contributions in excess of the $15,500 limit may be allowed if you are age 50 or older, or if you have 15 years of service with your employer. Your tax advisor and agent can help you determine the amount you may contribute.

*The dollar limit on TSA contributions must be reduced by any elective deferrals to a 401(k) plan or salary reduction SEP plan in which you participate. Other limits may apply if contributions are made for you under a qualified retirement plan for an outside business of which you are an owner.

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Can I stop making contributions to my annuity or change the contribution amount?

Yes. You may stop contributing or change the contribution amount to your annuity at any time by contacting your payroll department or agent. If you stop contributing, the amount that you’ve put in up until that point will continue to grow on a tax-deferred basis until you begin making withdrawals. Please keep in mind that even if you stop contributing due to a financial situation, you can always restart at any time in the future without opening a new contract.

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Do I have access to my money before I retire?

Yes. Although you will enjoy the most dramatic growth when you keep your money in an annuity until retirement, many TSAs have loan and withdrawal provisions:

Loans.* Provided you meet certain contract minimums, most TSA contracts** allow you to take a tax-free, low-interest loan. Usually the payback period is five years, with regular payments required. If your purpose is to purchase a primary residence, your term may be extended.

Withdrawals. Withdrawals are generally 100% taxable. If you’re under age 59½, withdrawals are restricted by tax law, and, when permitted, you may have to pay a 10% tax penalty in addition to normal income taxes.

Partial Withdrawal. You may be able to withdraw part of the money in your annuity without paying an early withdrawal charge to the insurance company. This option may not be available in the first year.

Full Withdrawal. If you wish to make a full withdrawal (take all of your money out of the annuity), you may incur an early withdrawal charge.
*Please note that any loan is issued by the appropriate Great American Financial Resources®, Inc., insurance company using your contract value as collateral for the loan.

**Loan availability under some products is limited.

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What if I change jobs?

Not a problem. You can keep contributing to your existing TSA if your new employer sponsors a 403(b) program through Great American Financial Resources®, Inc.

If your new employer is not an eligible organization, you may be able to leave your TSA money where it is, and it will continue growing, tax deferred. Although you won’t be able to contribute additional funds to the annuity, your money will continue to grow.

Distributions from traditional IRAs, TSAs, 401 plans, and governmental 457 plans have broad portability. Generally, the funds can be rolled from and into any of the above-mentioned plans if:

The distribution is eligible for a rollover; and
The new plan or provider is willing to accept the funds.
There may be other options available to you. You’ll want to discuss these with your agent and tax advisor.

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When can I begin receiving payments from my TSA?

The IRS restricts TSA distributions prior to age 59½, unless you experience an eligible triggering event – severance from employment, disability, some financial hardship situations, and certain reservists called to active duty before 2008. Provided you satisfy one of these eligibility requirements, you can receive general payments in a lump sum (subject to contract provisions), or by annuitizing your contract to receive a series of payments. Earnings cannot be distributed on account of a hardship, nor can your contract be annuitized on account of a hardship.

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Do I have to take distributions when I reach age 59½?

No. However, according to tax law, you must begin taking certain required minimum distributions (RMD) by the later of: (1) April 1 following the year in which you reach age 70½, or (2) April 1 following the year you sever employment.

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Will the distributions from my annuity contract affect my State Teachers Retirement Income?

No. Benefits under the State Teachers Retirement System (STRS) are calculated as though no deductions in salary have been made. You will receive full STRS benefits at retirement.

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When does my contract mature?

Unlike a certificate of deposit (CD) at a bank, your annuity does not technically “mature” as of a certain date. Your annuity can continue to grow tax-deferred until you are ready to commence distributions or until you are required by tax law to start receiving a RMD. The Maturity Date (also called the Annuity Commencement Date in some contracts) is set to the date of your 70th birthday as a reminder to you to review the need to take a RMD.

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What are my payout options?

Depending on your annuity contract, there are a variety of payout options.

You may receive your money as lump sum payments or you can elect one of the Settlement Options as outlined in your contract. Your annuity contract through one of the insurance subsidiaries of Great American Financial Resources®, Inc., offers a variety of Settlement Options designed to satisfy your financial/retirement needs, including life-based options that provide an income you cannot outlive. Your agent will be able to explain each payout option and help you select the appropriate option to meet your goals and situation.

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Can I roll over my payout?

Most distributions from your TSA can be rolled over to another TSA or to an IRA, 401 plan, or governmental 457 plan. Required minimum distributions after age 70½, hardship distributions, and certain annuitization payments cannot be rolled over. If you roll over a payment from your TSA, the tax on that payment will be tax deferred.

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What taxes can I expect to pay when I receive my payout?

When you contribute to a TSA, the earnings on your principal grow tax deferred. When you begin receiving annuity payments, the full amount of each payment is generally included in your taxable income for federal income tax purposes. However, you may be in a lower tax bracket when you retire and begin receiving your annuity payments. State and local taxes may also apply.

If withdrawals are made before age 59½, a 10% tax penalty may apply. Exceptions to this penalty tax are available for certain distributions.
Before you withdraw funds from your TSA, check with your tax advisor for more information about the taxation of annuities.

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What is a Roth TSA, and how is it different?

If permitted by your employer’s TSA program, you may designate your TSA contributions as Roth TSA contributions. Roth contributions and related earnings must be separately tracked.

Unlike a traditional TSA contribution, a Roth TSA contribution comes out of your salary after taxes. This means that there is no reduction in your taxes on account of the contribution. However, a distribution of Roth TSA contributions and related earnings is completely free of federal income taxes if it is a qualified distribution. To be a qualified distribution, two conditions must be met. First, the distribution cannot be made during the five-year period that begins with the year of your first Roth TSA contribution to your employer’s TSA program (or to a prior program from which a rollover was made). Second, the distribution must be made after you reach age 59½, become disabled, or die.

A Roth TSA is subject to the same distribution restrictions that apply to a traditional TSA. Until you reach age 59½, you can only take a distribution from a Roth TSA if you sever employment with your employer, become disabled, incur a hardship (as defined by the IRS), die, or are a reservist called to active duty before 2008 for 180 days or more or an indefinite period.

If, when permitted, you take a distribution that is not a qualified distribution, then there still is no federal income tax on the portion of the distribution that represents your Roth TSA contributions. The portion of the distribution that represents earnings will be subject to income tax, and a 10% tax penalty may also apply if before age 59½.

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Are there any other costs associated with an annuity?

Sales charges, early withdrawal charges, administration fees, and other costs can vary from annuity to annuity and from company to company – and the fees may be called different things. In general, most companies offer annuities without "front-end" sales charges. This means you pay no sales charges up front.

Most annuities have early withdrawal charges – you pay a fee or penalty if you decide to withdraw funds from your annuity before the end of a specified period (your contract will detail the penalties and time periods).

Some companies and some annuities waive the charge in certain cases: if you die, become disabled, or enter a nursing home.
In addition, some annuity companies may charge a contract fee (also called a maintenance fee or administration fee).

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Why choose a TSA from the insurance subsidiaries of Great American Financial Resources®, Inc.?

Experience, integrity, and financial strength.

Experience. Through our wholly owned subsidiaries, Annuity Investors Life Insurance Company® and Great American Life Insurance Company®, we offer a full range of fixed, fixed-indexed, and variable retirement annuities to meet your retirement goals and investment style. Great American Life Insurance Company has been helping educators provide for their retirements since 1975. Today, our companies service more than 6,000 educational institutions and continue to be leaders in the tax-sheltered annuity business.

Integrity. The Cincinnati insurance operations of our insurance subsidiaries Great American Life®, Loyal American Life, and Annuity Investors Life are members of the Insurance Marketplace Standards Association (IMSA), an organization dedicated to promoting ethical conduct in the insurance industry.

Financial Strength. When you select an insurance company, you want to be sure that the company is financially strong. Our GAFRI insurers have been consistently rated strong in financial stability and claims-paying ability by the top industry rating services. GAFRI is a publicly traded company on the New York Stock Exchange (NYSE: GFR). Through September 2006, GAFRI and its family of life insurers reported $12.9 billion in assets under management*, more than $1 billion in both premiums and net worth, and $82 million of net earnings. Since 2001, statutory premiums have exceeded $1 billion annually. Our largest life insurance subsidiary, Great American Life Insurance Company®, is in the top 12 percent of stock insurance companies based on net admitted assets (Best's Quarterly Statement File – L/H, US (2006 Six Month Data), Version 2006.10). Our subsidiaries now offer consumers a range of financial resources, including fixed, indexed, and variable annuities, and a variety of life, long-term care, and supplemental insurance products.
Please contact your agent or tax advisor for more details on the benefits of annuities.
*Total liabilities were $11.9 billion.

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Note: The above information is not intended or written to be used as legal or tax advice. It was written solely to support the sale of annuity products. As a taxpayer, you cannot use it for the purposes of avoiding penalties that may be imposed under the tax laws. You should seek advice on legal or tax questions based on your particular circumstances from an independent attorney or tax advisor.

GAFRI's variable annuities are issued by Annuity Investors Life Insurance Company®. You should consider the contract's and underlying portfolios' investment objectives, risks, charges, and expenses carefully before investing. Call 1.800.789.6771 to obtain a free prospectus containing this and other information to read carefully before investing.

Tax deferral may be available through a qualified plan without the use of an annuity. Variable annuities are long-term investment vehicles. Investments in variable portfolios are subject to market risks so upon withdrawal, the value may be more or less than the amount of the original purchase payments. Principal Underwriter/Distributor: Great American Advisors®, Inc., member NASD and a subsidiary of Great American Financial Resources, 525 Vine Street, Cincinnati, OH 45202.
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What is the Accidental Medical Expense (AME) rider?

The Accident Medical Expense rider provides benefits for injury due to a covered accident. AME benefits are administered per injury/accident, instead of per calendar year. After AME benefits are paid, your annual health insurance deductible, coinsurance and emergency room copayment (if appropriate) will apply.
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What is the Doctor's Office Copayment (DOC) option?

The Doctor's Office Copayment Option is an optional benefit that provides 100% coverage for all covered reasonable and customary charges for an office visit to any physician after a copayment. Copayments do not apply toward satisfying the deductible or out-of-pocket maximums.

What is a Maternity rider?

A Maternity rider is an amendment to a medical policy that provides coverage for normal childbirth.
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Who is Medco Health?

Medco Health is the vendor Assurant Health uses to process your prescription drug claims. In other words, they are an outside company we contract with to administer your prescription drug benefits on our behalf.

How do I use my Medco Health Prescription ID card?

Each time you fill a prescription, present your ID card at a participating Medco Health pharmacy. Once you satisfy your annual deductible, you pay the copayment specified on your drug card. After applying any discounts, deductibles, or copayments, the pharmacy will submit your claim electronically. To locate a participating pharmacy, simply contact Medco Health at the number on your prescription ID card, or visit www.medcohealth.com.
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Am I covered when I go out of the United States?

Unless specifically excluded by your contract, you are covered for the benefits listed in your health insurance policy. All health insurance policy provisions apply, including medical necessity and reasonable and customary.

What is a Special Exception Rider (SER)?

A Special Exception Rider excludes health insurance coverage for a specific medical condition for an individual family member. These riders are generally put on health insurance policies due to pre-existing conditions, and exclude benefits for any diagnostic services or treatment for that condition for the named family member.
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What is a Special Class Premium (SCP)?

A Special Class Premium is an additional premium amount you pay for your health insurance policy due to a medical condition you might have (for instance, high blood pressure).

What is a non-smoker discount?

A non-smoker discount is a reduction in the health insurance premium amount for our policyholders who lead a healthier lifestyle by not using tobacco products.
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What is a deductible?

A health insurance deductible is the amount of covered expense you must incur and pay each calendar year before we will pay for covered medical expenses. This is for each individual, each calendar year. Expenses that are not covered by your health insurance policy will not be applied to your deductible.

When does my calendar year deductible start over?

The calendar year begins January 1st and ends December 31st each year.
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What is coinsurance?

Coinsurance (also known as Rate of Payment) is the percentage of covered expense you are responsible for after you have met your deductible. For example, if your coinsurance is 20% up to $5000, Assurant Health will pay benefits at 80% of covered expenses up to $5000. Then Assurant Health will pay 100% of your covered charges, up to the policy maximum. You are responsible for the 20% amount that Assurant Health does not pay.

What is a copayment?

A copayment is the amount you pay for each prescription drug or PPO physician office visit.
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What is individual out-of-pocket expense?

Individual out-of-pocket expense is your deductible and coinsurance added together. In other words, it is the maximum you will have to pay — per person, per calendar year — in deductibles and coinsurance.

What is family out-of-pocket expense?

Family out-of-pocket expense is your deductible and coinsurance added together, for your whole family. In other words, it is the maximum you will have to pay per person, per calendar year, no matter how many members of your family need health insurance benefits.
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What is reasonable and customary?

Reasonable and customary (R&C) is the dollar amount allowed for a particular service. The reasonable and customary amount for charges is determined by Assurant Health using your geographic area.

What do I do if my physician or hospital is billing me for the amount not covered as over the reasonable and customary amount?

There is a specific reasonable and customary amount allowed in your geographic area, and this is the amount allowed by your policy. Anything over the reasonable and customary amount would be your responsibility.
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Who is Concentra Preferred Systems?

Assurant Health determines reasonable and customary amounts on facility (i.e., hospital) charges. If you wish to dispute a reasonable and customary amount allowed for a facility charge, please call them at the toll-free number listed on your EOB statement.

What is preauthorization?

Preauthorization is when we are notified in advance of a surgery or hospital stay, and is required for most policies. The requirements can differ from policy to policy, but the purpose of preauthorization is to determine if a hospitalization or surgery is medically necessary, and how many days of hospitalization are warranted. Your health insurance ID card shows the preauthorization telephone number, and a full listing of which services require preauthorization can be found in your health insurance policy. Please follow the preauthorization procedure in order to maximize your benefits.
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What is a predetermination?

A predetermination of benefits is a written request for verification of benefits. We review these requests based on policy provisions, and send an explanation of your potential health insurance benefits. You may request a predetermination before your medical procedure, although a predetermination of benefits is generally not necessary.

Does my surgery/hospital stay need preauthorization?

In most cases, preauthorization is a requirement for services listed in your health insurance policy. Please review your health insurance policy for details.
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How do I get my surgery/hospital stay preauthorized?

Your health insurance ID card shows the preauthorization telephone number, and a full listing of which services require preauthorization can be found in your health insurance policy. Please follow the preauthorization procedure in order to maximize your benefits.

How am I notified whether or not my surgery/hospital stay is preauthorized?

Your preauthorization vendor will send you a telegram that will explain if the procedure and/or hospital stay is approved or denied. If you are being hospitalized, the specific number of days approved will also be provided.
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How long do I have to submit a bill/claim?

Please submit the claim as soon as you can. Assurant cannot consider any claim received more than 15 months after the date of service.

How do I get a claim form for my prescriptions?

Usually, the pharmacy will submit prescription claims for you. Otherwise, to order claim forms, simply contact Medco Health at the number on your prescription ID card, or visit www.medcohealth.com.
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Where do I send claims?

Refer to the back of your health insurance ID card for claims submission information.

Can I fax in a claim?

Yes. Our fax number is (414) 224-0472.
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How long does it take to process a claim?

The amount of time it takes to process a claim depends on the information submitted. In general, you should receive an Explanation of Benefits within 3-4 weeks. If additional information is required to process a claim, we will notify you, and the claim could take longer to process.

How do I appeal a claim denial?

If you believe your claim has been processed incorrectly, please contact our Customer Services Department. If you do not agree with the denial of a claim, please send an appeal in writing to Assurant Health, Correspondence Department, P.O. Box 624, Milwaukee, WI, 53201-0624. Note any extenuating details, include any documentation pertaining to the appeal, and keep a copy for your records.
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My physical therapy/chiropractic claim was denied as maintenance care. What does that mean?

Maintenance care means that the care that you are receiving is no longer improving your medical condition.

What is the Network Option?

This option utilizes a network, which is comprised of a large number of participating hospitals and physicians. The providers in this network have agreed to reduce the amount they charge for services provided to our policyholders. Network availability may vary depending on the area in which you live.
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Who is my vendor? What is the name of my Network?

This information is printed on your health insurance ID card, along with a telephone number for you to contact the network vendor for your policy. Vendor contact information.

Which physicians and hospitals are members of my Network? How can I find out if my physician is a member of my Network?

At the time you received your health insurance policy, you may have received a directory of physicians and hospitals in your network. If you would like an updated list, please contact your network vendor. You may also contact your provider's office and ask if the physician is a member of the network (listed on your ID card). Always verify whether your provider is a member of the network in order to maximize your health insurance benefits. Vendor contact information.
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How can I get an updated Network directory?

Please contact your network vendor. Always verify whether your provider is a member of the network in order to maximize your health insurance benefits. Vendor contact information.

How do I contact my vendor?

A telephone number for your network vendor is printed on your health insurance ID card. Vendor contact information.
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Why are my claims sent to the Network vendor first?

The network vendor determines the discounts that are applied to your bills, and then forwards them to Assurant Health.

My Network physician wasn't in the office. I saw the "on call" physician. Will this be paid as a Network claim?

If the physician you saw is a member of your network, we will consider the charges at the network rate of payment. If the physician you saw is not a member of your network, we will consider the charges at the non-participating provider rate of payment.
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The clinic was a Network provider. Why wasn't the physician paid as a Network provider?

Each physician contracts individually with the network. If the physician you saw is not a member of your network, we will consider the charges at the non-participating provider rate of payment.

I was on vacation and had to see a physician. Will you pay my claim at the Network rate?

If the physician you saw is a member of your network, we will consider the charges at the network rate of payment. If the physician you saw is not a member of your network, we will consider the charges at the non-participating provider rate of payment.
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What makes GTL Term Life Insurance different from other life insurance policies?

Qualified applicants can apply in as little as 10 minutes and get a Term Life policy approved within days, with no medical exam required. Other life insurance policies can take months to buy. Also, our Term Life offers you guaranteed rates--premiums are locked in for each term period.

How much does GTL Life Insurance cost?

Compared with other forms of life insurance, term life provides the most affordable protection for your dollar. For example, a 30-year old, non-smoking man will pay just $31 a month for a 30-year $150,000 coverage. That’s less than the price of a cup of coffee a day!
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Are my premiums and benefits guaranteed?

Yes. Your premiums will never go up, and your benefits will never go down during the term. Premiums and benefits are locked in at the time you apply and are guaranteed for the entire duration of your life insurance term.

How much do I need?

Whether you’re buying your first policy or supplementing an existing policy, you should understand how much your loved ones may need. Take into consideration any mortgage, loans and credit card debt that may be outstanding. Future obligations such as college funding may also be considered. If your dependents need to replace your income, consider a death benefit that produces interest income at that level. Finally your current budget should be able to handle the premium payments.

Convenient, easy to budget monthly premiums, quarterly, semi-annual, and annual (best value) payments are available.
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What are your hours of operation?

Our skilled professionals are available to serve you Monday - Thursday, from 7 a.m. - 5 p.m. (CST), and Friday, from 8 a.m. - 12 p.m. (CST).

Can I view or change my policy online?

GTL does not currently offer access to policy information online. If you need information about your policy or other products or services, please contact the Customer Service unit at 1-800-338-7452.
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Can I pay my premiums online?

No, Unfortunately, GTL does not currently have an online payment option. However, you can pay your premium through your bank via electronic Funds transfer, or you can send a check to our mailing address.

How do I check on the status of my policy or get information on my policy?

In order to get information on a policy, or the status of the policy, please call our Customer Service unit at 1-800-338-7452. Please have the name of the insured (the person insured by the policy) and the policy number ready when you call.
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How can I get a duplicate copy of my policy?

We understand that sometimes you need a duplicate copy of your policy, whether you have lost it or merely want to keep a copy in a safe place (just in case). To get a duplicate copy of your policy, please call Customer Service at 1-800-338-7452.

How can I change my address, beneficiary, or my name on my policy?

In order to change your name, address, or beneficiary on your policy, you should complete a Policy Change Form, which must be signed by the owner of the policy.

For copies of the Policy Change forms, call the Customer Service unit at 1-800-338-7452. When you have completed the form and obtained the policyowner's signature, please return the form to GTL by fax at 1-847-699-2551 or by mail to:

Guarantee Trust Life Insurance Company
ATTN: Policyowner Services
1275 Milwaukee Ave
Glenview, Illinois 60025
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How do I file a life insurance claim?

A beneficiary, family member, or funeral home should call the Customer Service unit at 1-800-338-7452 with the following information:

Insured's name
Policy number
Date of death

Based on how long the policy has been inforce, different information may be required. We will need:

Certified death certificate (original, not a copy)
Original policy (if available)
Completed claimant's statement (form provided by GTL)

Your Claims Representative will notify you if any additional forms or information are required.
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Why is the purchase or refinance a home required within the last two years?

If you have not refinanced or purchased a home within the last two years you should contact the representative for an alternative plan (there are other plans that do not have this requirement).

There are many ways an insurance company will underwrite an insurance product. Most of the time an insurance carrier will ask you to have extensive testing (blood, urine, physical) to qualify for a life insurance plan. To qualify for this simple life insurance plan, GTL underwrites based on a couple of medical questions, a report from the Medical Information Bureau, and only accepts clients that have refinanced or purchased a home within the last two years.
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Why do I need life insurance?

Pay final expenses
The current average cost for an adult funeral is approximately $6,100, which can include a casket and services, such as embalming, visitation, and the use of a hearse. But this amount does not include the related burial cost, such as burial plot, burial vault, headstone, grave opening, cremations, or urns.***

Replace income for your dependents
If people depend on your income, life insurance can replace that income for them if you die. Add up all of your monthly bills and imagine who is going to pay them. Typically, advisors will encourage their clients to buy enough so that their clients can live off the interest (5-20 times annual salary).

Create an inheritance for your heirs
Even if you have no other assets to pass to your heirs, you can create an inheritance by buying a life insurance policy and naming them as beneficiaries.

Other reasons: Pay federal and state "death" taxes, Make charitable contributions, College funds
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Is this as simple as it seems?

Yes, applying for life insurance has never been simpler and should only take 5 minutes. Just get an online quote, select your premium, apply online, and submit your premium. Everything is done online with no paperwork. No insurance agent will visit.

What is a beneficiary?

A beneficiary is the person or entity you name in a life insurance policy to receive the death benefit.
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How much life insurance do I need?

If you need to replace your income: Advisors recommend anywhere from 5 to 20 times your annual salary. These numbers are calculated based on your dependents investing the money and earning 5% interest. This would replicate your salary if need be.

If you want enough to pay off your funeral cost and debt: you will need at least $10,000 plus your existing debt (which can include but not limited to: medical bills, house, auto, loans, etc...)

Do I have to meet with an insurance agent?

No, you get your quote, select your plan, and apply online. The process should only take 5 minutes. If there is an issue with your account an insurance agent (or GTL company representative) will give you a call/email. There will be no appointments or doctor/insurance agent visits.
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What are the eligibility requirements?

GTL offers three plans based on demographics and health history: Preferred, Standard, and Graded. The eligibility requirements are below:

Preferred Plan: Great health means great rates. It is important that you insure your insurability. This is the time for you to buy insurance because you never know what the future holds and you should lock in the great rates guaranteed for life.

Issue ages: 6 months - 65 years of age

Death Benefits available:

$10,000 - $50,000 for ages 6 months to 49

$3,000 - $25,000 for ages 50 to 65
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Standard Plan: Ok, so you have had a minor health setback, overweight, or over the age of 65. The Standard plan is a whole life policy that provides guaranteed protection for life at guaranteed standard rates. These rates are guaranteed to stay level for life..

Issue ages: 6 months - 85 years of age

Death Benefits available:

$10,000 - $50,000 for ages 6 months to 49

$3,000 - $25,000 for ages 50 to 85

**Graded Plan: not everyone has a clean bill of health, the graded plan was designed to accommodate situations where clients do not qualify for the preferred or standard plan. Many times this is the last option available for individuals to qualify for whole life insurance.

In the event of your death during the first two policy years GTL will return the premium paid plus 10%. GTL will pay full benefits thereafter. (MN applicants see note #1)

Accidental Death Benefit: Full benefits for accidental death from the first day the policy is issued. (Not applicable in AR)

Issue ages: 50 to 80 years (MN Applicants See Note #2. MO applicants see Note #3)

Death Benefits available:

$3,000 - $25,000 for ages 50 to 80
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How long does it take to get this insurance?

The online quoting and application process should only take 5 minutes. After you complete the online application it is electronically delivered to an GTL underwriter for review. If the underwriter is able to make a decision without further investigation (ordering medical records or APS) then your policy could be approved in a day. If the underwriter has to order medical records, phone interview, or request a Attending Physician (APS) Statement the process could take up to 2 months depending on when GTL receives the information.
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Do I have to take a medical exam to get this insurance?

No, applying for coverage is easy and takes less than 5 minutes online. Just enter your information and get a quote, you can then apply online with a credit card or Electronic Funds Transfer from your bank. If you want to download an application, first complete the online application and you will have the option to print a completed one.

Who would receive the money paid by my insurance company?

The full benefit amount will go to your beneficiary of your choice. It can be your spouse, child(ren), a relative, or a friend.
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When will my coverage begin?

As soon as the underwriter approves the policy. You will receive an email confirmation.

Will my coverage change?

No, your policy will stay the same guaranteed. Your face amount will not decrease as you get older.
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Can my rates change as I get older?

No, your rates are guaranteed to stay level your entire life. You have a peace of mind knowing that this insurance will stay with you for your lifetime.

Is the policy guaranteed to my satisfaction?

You have a no risk 20-day money-back-guarantee.

Notes:

#1: MN, 1st and 2nd year death benefits are four times the first year premium. Full Benefits thereafter.
#2: MN, Issue Ages: Male 50-75 and Female 50-80
#3: MO, Issue Ages: 50-75
* Graded Plan is not available in all states. Percentages may vary in certain states.
** Graded Plan is not available in all states. Percentages may vary in certain states.
***National Funeral Directors Association, 2001

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Why do parents and grandparents need life insurance on their children?

You want to insure their insurability. If your child were to get a serious illness or accident he/she may not be able to qualify for life insurance in the future. With GREAT START you are guaranteeing them life insurance throughout their life's. Plus they will be able to purchase more coverage at the lowest rates available at certain times in their lives regardless of health history, occupation or military service.

What age does my child have to be to qualify?

3 months to 25 years of age.
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Will my adult child have additional opportunities to purchase life insurance?

YES - The GREAT START plan will guarantee it to them with three $10,000 GUARANTEED PURCHASE OPTIONS (at age 31, 34 and 37) regardless of their health or occupation - and at our lowest rates at the time!

Will my child be insured from DAY-ONE?

Full coverage starts right away, subject to the answers on your application. The only exclusion is suicide in the first 2 years (1 year in CO and ND). This exclusion is not applicable in MO.
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How long is coverage guaranteed for?

As long as premiums are paid, your child's policy is guaranteed for life, regardless of age, health, or occupation.

How long is the rate guaranteed for?

Once your child is insured, the premium stays the same throughout your child's life, guaranteed never to go up.
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What if my child enters the military. Will he/she still be covered?

Should your child decide to enter the military, the policy will continue to provide full coverage.

Can a Grandparent apply for GREAT START for their Grandchildren?

Yes, A child's parent, grandparent or legal guardian can be the policyholder.
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What kind of policy is the GREAT START plan?

The GTL GREAT START plan is a whole life insurance policy. The policy is good for a lifetime, regardless of future age, health, military service, or hazardous occupations.

Is there a medical exam to qualify?

No, applying for coverage is easy and takes less than 5 minutes online. Just enter your child's information and get a quote, you can then apply online with a credit card or Electronic Funds Transfer from your bank. If you want to download an application, first complete the online application and you will have the option to print a completed one.

Is the policy guaranteed to my satisfaction?

You have a no risk 30-day money-back-guarantee.
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The Presidential Life Graded Benefit (whole) Life policy is issued on a guaranteed issue basis for ages 40 - 80 in most states.** There are no medical questions, no medical examinations, and no medical tests required to obtain this coverage. The minimum policy face amount is $1,000, and the maximum, $50,000.

Benefits payable under the Graded Benefit (whole) Life policy are limited in the first two or three years, depending on the issue age of the insured.

If the insured is under age 65, the benefit payable in the event of death that does not result from accidental means during the first 3 policy years is an amount equal to the premiums paid plus 5% compounded annually.

If the insured is age 65 or older, the benefit payable in the event of death that does not result from accidental means during the first 2 policy years is an amount equal to the premiums paid plus 5% compounded annually.

If death occurs as the result of accidental means during a policy's 2- or 3-year graded benefit period, the death benefit payable under the policy will be premiums paid plus 5% compounded annually plus an accidental death benefit amount equal to the full face amount of the policy.
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Guarantee Income Life - Long Term Care	Guarantee Trust Life - Whole Life
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Presidential Life - Graded Death Benefit