The Collateral Crisis: Adult Daughters Caring for Elderly Parents

There are currently 44 million unpaid elder care providers in the United States, with women composing the majority. Adult daughters account for seven of every 10 adult children who help their older parents.

The growing number of seniors being cared for by family is creating a collateral financial crisis for the so-called “Sandwich Generation.” This is particularly true among women, who lose an estimated average of $324,044 in compensation due to familial caregiving, according to a study from MetLife and the National Alliance for Caregiving.

I personally lived through this experience a few years ago when my then-78-year-old mother was diagnosed with a terminal disease. I lived halfway across the country at the time and ran my own business, but I quickly moved back home to share the responsibilities of caring for my mother with my two working sisters. Just a few years later, my father neared the final stages of his life. He was in an assisted living facility and had started to run out of money. His last remaining assets and Social Security benefits were being used to continue his care. Eventually, all he had left was a small life insurance policy.

My sisters and I didn’t think twice about the decision to help our mom and dad in their last years — just like so many adult children of older Americans. But it’s also true that caring for them adversely impacted the finances of my sisters and myself.

Not only had I stopped earning income during the times of caring for my parents, my sisters and I were paying for many of the costs of our parents’ long-term and end-of-life care. No money coming in, and lots of money going out. Compounding this impact was the fact that I wasn’t able to contribute to my own future retirement needs (i.e., pension plan contributions). It didn’t occur to me until later that not only was I not saving for retirement, I wasn’t contributing to my own Social Security.

Life Settlements

Had I known that my parents’ life insurance policy could be sold through a life settlement for immediate cash, it might have been a great help. In a life settlement, a policyowner sells their life insurance policy rather than letting it lapse or surrendering it back to the insurance company. The policyowner always receives more than they would in a lapse or surrender and can then utilize this “found money” to pay for healthcare or assisted living, fund their retirement, or serve whatever other purpose they choose.

Life settlements can also prevent adult children (or other unpaid caregivers) from having to use their own savings, as well as support them when they step away from their own careers to become a caregiver for a parent. In my dad’s case, a life settlement would have relieved some pressure on him and my sisters by helping to subsidize his continued care in assisted living.

Life Settlements are a Sensible Solution

While my father purchased the policy to provide for his loved ones, our mother had died a few years prior, and my sisters and I were all grown women with our own careers. My father’s need for care – and the cost of that care – far outweighed any death benefit. Had we known about life settlements, we would have immediately sold the policy and used the money from the sale to pay for his care.

The lack of awareness that surrounds life settlements is perhaps the greatest challenge, as many people don’t realize that life settlement companies pay owners an average of at least four times the policy’s cash surrender value. Furthermore, adult children are often unaware that their parents even have a policy.

Every financial professional – financial advisors, insurance agents, and others – should find out if their senior clients own a life insurance policy, if they don’t already know. Having that policy appraised by a life settlement company is free to the policyowner and will help determine the policy’s living benefit. Advisors should also bring their clients’ adult children into the discussion to raise their awareness about life settlements — because of the impact caring for their aging parents will surely have on them.

Long-Term Impact

When I scaled back my business to help my parents before their deaths, it never dawned on me how the loss of income would affect me financially since I was so focused on taking care of them. The statistics show that I am not alone in this experience. The collateral crisis of adult children caring for their parents is widespread and particularly impacts women.

Over the next decade, an estimated $2 trillion of life insurance death benefits will lapse or be surrendered by seniors that could instead generate tens of billions of dollars if they are sold If more people knew about life settlements, they could take advantage of this growing market and make a great difference in the lives of older Americans and their adult children caregivers.

Anne Long is senior vice president of business development at LightHouse Life, headquartered in Conshohocken, Pennsylvania.
November 8, 2019

Industry ‘Not Even Piercing’ Potential Of Life Settlements: Speaker

The life settlement industry has been on a steady growth trend for some time now, and market developments point to that trend continuing.

For starters, the size of the potential market should encourage agents and brokers to give life settlements a look, said Michael Coben, chief distribution and business development officer with Lighthouse Life, based outside Philadelphia.

Coben is leading a session today on life settlements at the NAILBA Annual Meeting. He will focus on expanding the life settlement market to include policies as low as $100,000.
OCTOBER 10, 2019

Lighthouse Life Bolsters Senior Leadership Team with Four Strategic Hires

Lighthouse Life recently brought on board Ted Kilkuskie, Senior Vice President, Business Development, Jason Rizzo, Vice President, Business Development, Joseph Patrick, Vice President, Business Development, and Canio Caputo, Director of Salesforce Operations.

“Our passion–and the foundation of our business–lies within educating financial professionals about how life settlements can provide real value to seniors in retirement, as well as to augment the professional services and practice of these financial professionals,” said Michael Coben, Lighthouse Life Co-Founder and Chief Distribution Officer, who explained that each of the new members bring a wealth of knowledge and experience that will further the company’s growth and development. “Ted, Jason, Joe, and Canio are seasoned professionals who contribute to our mission of making life settlements a valuable tool for financial professionals and their clients.”

Ted Kilkuskie has more than 30 years of experience in insurance and financial services. He most recently served as the national sales manager at The American College of Financial Services where he oversaw the business development and sales efforts for all financial channels, and the development of innovative programs for College customers in the broker-dealer and insurance industries. At Lighthouse Life, Ted leads the company’s efforts to recruit, develop and implement strategic alliances with national and regional broker-dealers, registered investment advisors and other financial services professionals.

Jason Rizzo comes to Lighthouse Life with 20 years of experience as a financial service professional where he worked closely with insurance and financial services firms and their producers and advisors to assist clients with estate, business, and retirement planning, including life, disability and long-term care needs. Jason previously held posts at BB&T as a business development specialist, and Prudential Financial as a regional vice president. He spent over 10 years working at Crump Life Insurance Services.

Joseph Patrick joins Lighthouse Life with more than 10 years of experience in financial services distribution, primarily at Lincoln Financial where he most recently served as an external wholesaler for the company’s RIA annuity channel. Joe has extensive front-line business development and sales and marketing experience specific to the fixed indexed, variable, immediate, long term care and deferred annuity product lines. Joe is an active paratrooper with the 304th Civil Affairs Brigade with the US Army Reserves and served two combat tours overseas with the US Army Civil Affairs Command.

As vice presidents, business development, both Jason and Joseph are responsible for the development and management of relationships with financial professionals and firms that are enrolled in the Lighthouse Life Settlement Advisor Program. Jason’s primary focus is within Lighthouse Life’s insurance distribution channel, and Joe is primarily focused on Lighthouse Life’s broker-dealer and RIAs distribution channel.

Canio Caputo joins Lighthouse Life to lead the company’s design and implementation of salesforce workflow solutions to provide efficiency and accuracy throughout the business processes, as well as the business analytics and intelligence efforts to highlight those improvement needs. Canio has worked for financial services and banking companies where he primarily engaged in business system management and analytics. He successfully developed and implemented a customer success platform that won the 2016 Technology Services Industry Association award for Innovation in Leveraging Analytics for Service Excellence. A US Navy veteran, Canio currently serves as an Honorary Commander at Dover Air Force Base.
JULY 26, 2019

Lighthouse Life’s CEO Michael Freedman talks life settlements on The Probate Nation

“Life insurance is an asset that has a value for many Americans, particularly seniors in need of resources in retirement. It’s an asset that was created through their premium payments and has, often times, the value that is equal to or close to the equity in their own homes…So, learning about life settlements – whether it’s the policyowner themselves or their professional advisor – they should understand that value and if it makes sense for that person to sell their own policy, that’s what they should do.”

Lighthouse Life’s CEO Michael Freedman talks life settlements on The Probate Nation hosted by Richard Ruddy with fellow guest Dennis Bartos of AgencyONE Insurance Services.
JULY 24, 2019

DPL Financial Partners teams with Lighthouse Life to provide life settlement options to RIAs and their clients

Advisors seen as uniquely suited to help clients evaluate their ongoing need for legacy life insurance policies

“We’re honored to work with DPL and their member RIAs to bring our life settlement service to the fee-only advisor market,” Lighthouse Life Chief Distribution and Business Development Officer, Mike Coben said. “We like to work with policyholders who are well-informed, so the RIA market – where clients are advised by financial professionals acting in their fiduciary interest— is a great new business channel for us. By ensuring that RIA clients have access to life settlements, DPL is once again showing innovative leadership in the industry.”
March 5, 2019

Annemarie Long Joins Lighthouse Life Solutions, LLC as Senior Vice President of Business Development

Lighthouse Life Solutions, LLC is excited to announce that Annemarie V. Long has joined the company as Senior Vice President of Business Development. Anne will be leading the company in developing relationships with life insurance distribution organizations as well as other professionals who provide adjacent services such as financial planners, CPAs and attorneys, to educate and assist these financial professionals in helping their clients maximize the value of their life insurance policies through life settlements.

“Anne Long’s well-known professionalism and experience is a welcome addition to Lighthouse Life. Anne’s deep-rooted relationships within the financial services industry will be a tremendous asset for us as we work together with a range of financial professionals to increase their awareness about and participation in life settlements,” said Michael Coben, Lighthouse Life Solution’s Chief Distribution and Business Development Officer.

Prior to joining Lighthouse Life, Anne owned and operated Long Consulting Group, a strategic consulting firm focused on designing and implementing growth strategies for insurance and financial services agencies. Anne has held executive leadership positions with NFP, Merrill Lynch and Manulife throughout her distinguished career. She currently chairs the Temple University College of Liberal Arts Board of Visitors and was until recently a member of the Board of Trustee of The American College of Financial Services.