A free look period often lasts between 10 and 30 days (depending on the insurance company), and allows the annuity contract holder to decide whether or not to keep the annuity policy. If the contract holder is not satisfied and wishes to cancel, the policy purchaser may receive a full refund.
The free look period typically starts on the date the contract holder receives the policy and acknowledges receipt of the contract. From the date the contract is received by the contract holder, he/she has between 10 and 30 days to decide whether they wish to keep the policy or cancel the policy.
Why Does It Matter for Medicaid Planning?
Some State Medicaid offices consider a Medicaid Compliant Annuity to be an “available resource” until the free look period has expired because the contract holder has the ability to cancel the policy and receive all of his/her money back. As such, if you reside in a state that obverses the free-look period, it is important to plan early enough in the month so that the free look period expires by the end of the month in which your clients are seeking eligibility.
Each insurance company & state is different as far as the length of the free look period. Please reach out to us with specific questions.
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