Which type of policy is right for you?

“Long-term care insurance” policies have changed significantly in the past 10 years. Today’s policies now provide rich benefits for care at home, federal standards for benefit qualifications, and larger benefit amounts. Today’s long-term care insurance policies can have as much as a million dollars of benefits. Since the older policies had such large rate increases, 41 states have passed strict pricing regulations to protect those who purchase long-term care insurance today.

We’re often asked: “What if my long-term care policy runs out of benefits?” The “Long-Term Care Partnership Programs” solve that problem. These programs have created special, government-approved policies that protect your assets from Medicaid even if your policy runs out of benefits. These policies can be very affordable because you only need to buy a benefit amount equal to the amount of assets you want to protect from Medicaid.

“Linked-benefit life insurance” policies combine life insurance and long-term care insurance. These policies usually have guaranteed level premiums. If you never need long-term care these policies pay a death benefit to your beneficiary. There are some excellent hybrids. Here’s what to look for in a good hybrid. There are also some terrible hybrids. Here are the warning signs of a terrible hybrid. If you’re healthy enough to qualify for traditional long-term care insurance, here are five reasons why traditional long-term care insurance may be better for you than a hybrid.

Annuities with long-term care riders are the least-known “hybrid”. These annuities are not good investments, but they can provide a hedge around your assets to help protect against the high cost of a very long period of care. When inflation protection is included, these annuities can pay long-term care expenses totaling five to eight times your single-premium deposit. 

“Recovery Care” policies are very similar to traditional long-term care insurance in many ways:
1) they have comprehensive benefits, which means they pay benefits for care you receive at home or in a facility
2) qualifying for benefits is very similar to traditional long-term care insurance

The biggest difference is that “Recovery Care” policies have lower benefit caps. Since the daily and lifetime caps are lower than traditional long-term care insurance policies, the underwriting is more lenient. In other words, it’s easier to qualify for a “Recovery Care” policy than it is to qualify for a traditional long-term care insurance policy. Also, because the lifetime caps are lower, the premiums are usually much lower than a traditional long-term care insurance policy.