Based on your feedback, Coverpath now supports 1035 exchanges via the Additional Life Insurance Rider (ALIR). This feature offers you and your clients more flexibility and lays the groundwork for future platform enhancements. Clients can use this feature to transfer cash value from an existing policy to Coverpath, which allows you to use Coverpath for cases where you want to replace an existing whole life policy.
How does it work?
When preparing a quote or starting an application for a client, advisors can now include a 1035 exchange where the funds are transferred to ALIR. Coverpath will issue the policy with an empty ALIR and the client will pay the first premium payment out of pocket. Then, once the funds come in via the 1035 exchange, Coverpath will add them to the ALIR. If the funds are different from what was quoted and applied for, Coverpath will send the client an updated illustration and spec sheet to demonstrate the changes that resulted from the transfer of funds.
What are the current limitations?
Currently, 1035s are not available for transferring funds to premiums or to replace policies with outstanding loans. The Coverpath team is actively working on adding the ability to use 1035s to fund premiums and expects to roll out this feature enhancement in the coming months.
“1035 exchanges give advisors a powerful new tool to better serve customers. The Coverpath team is excited for advisors to begin using our new tools and give us feedback to make the process even better!” -Gabe Diaz, Product Owner, Client Acquisition Team
Give Us Your Feedback!
Have an idea to improve a feature on Coverpath? We want to hear from you! To provide feedback or request new features, go to the “What’s Ahead” section on hub.coverpath.com and click the “Send General Feedback” button.
FOR FINANCIAL PROFESSIONAL USE ONLY.
Insurance products on the Coverpath platform are issued by Massachusetts Mutual life Insurance Company (MassMutual), Springfield, MA 01111-0001. Not all products are available in all states. State variations may apply. CP-202104-1398