PM 07-02-07
Refer to IES Wizard Life Insurance Policy Resource for details on how to enter life insurance information into IES.
Verify all life insurance policies regardless of whether they are exempt or nonexempt.
Enter all life insurance policies in IES regardless of whether they are exempt or nonexempt.
Verify the face value of all nonexempt life insurance policies. Sending form IL 444-0922 Life Insurance Review to the insurance company (requires signature from person or representative) may be helpful in getting the needed information.
- Example: The life insurance verification provided includes the name of the owner, name of life insurance company, the policy number and the death benefit amount. The caseworker sends a VCL asking for the face value because the death benefit does not reflect the FV. The FV (FV over or under $1,500) is needed to determine if the CV should be counted towards the resource limit.
The cash value of nonexempt life insurance policies with a total face value of $1,500 or less is disregarded. Do not request verification of the CV of nonexempt life insurance policies that have a total face value of $1,500 or less.
- Example: The person has two non-exempt insurance policies with a face value of $500 each (total face value $1,000), the cash value is not counted towards the resource limit because the total face value is less than $1,500.
Do not include the FV of dividend additions when determining the total face value.
- Example: The person has a life insurance policy with a FV of $1,750 but the FV includes $450 of paid up additions. The CV of the person's life insurance policy is not counted towards the resource limit because the FV ($1,750 - $450 = $1,300) is less than $1,500 when the paid up additions of the FV are not included.
The CV of dividend additions is included when the CV of nonexempt life insurance policy/s is counted towards the resource limit.
- Example: The person has a life insurance policy with a FV of $1,750 but the FV includes $150 of paid up additions. The CV of the person's life insurance policy, including the CV of dividend additions is counted towards the resource limit because the FV ($1,750 - $150 = $1,600) is over $1,500.
Assignment of a life insurance policy to a funeral home.
- Example: Ms. X collaterally assigns her life insurance policy to XYZ Funeral Home before moving to a nursing home. The state is named as remainder beneficiary of the life insurance policy. The life insurance policy has a FV of $2,000 and CV of $750. The assignment of the life insurance policy does not meet prepaid burial funding requirements described in PM 07-02-08-d because the assignment of the policy is not to a trust and the state is not named beneficiary of the trust. Consider the CV of the life insurance policy as an available resource.
