Case of the Week: Comparing Long Term Care Options

Recently, I presented a couple in their 50’s with possible solutions to future long term care concerns. I shared with them traditional long term care insurance and the “hybrid” Life with LTC rider product (both by John Hancock).

LTCi Options

Traditional Long Term Care Insurance

I shared my thoughts and philosophy with them. My fears with traditional long term care insurance mainly stem from potential rate increases. They are potentially 20 or more years away from utilizing the insurance. I’ve seen rate increases that have priced clients out of their plan when they are nearing the time it would most likely be utilized. Their concern was paying the premium for “all those years” and never using the insurance. That led me into the “pros” of the Life/LTC solution.

Life Insurance with an LTC Rider

With the Life/LTC hybrid product, you can assure your client that someone will be paid. Either the insured — in the form of long term care services (including home care and assisted living) — or their family upon the death of the insured, and in some cases BOTH. The insured may use some of the benefit for long term care and then die, at which time the family would receive the balance of the remaining face amount in the form of an income tax free death benefit. They also like the idea of a premium not increasing over time.

My clients are applying for a Life/LTC plan of $250,000 with a monthly long term care benefit of $10,000, and that fits their budget. While my concern is the benefit amounts may fall short of fully covering their needs, I shared with them MY thoughts. Statistics tell us that 1 out of 2 people will need long term care services. In many cases, the wife takes care of the husband and males typically pass before they spend much time (if any) in a nursing home. Any deficiency in benefits for the wife might come from her husband's policy, in the form of the remaining death benefit money. There is no guarantee for that to be the case, but it's certainly a possibility based on national statistics.

Our Solution

Female, Age 54
Death Benefit: $250,000
Monthly LTC Benefit: $10,000
Monthly Premium: $210.00

Male, Age 55
Death Benefit: $250,000
Monthly LTC Benefit: $10,000
Monthly Premium: $281.92


The time is NOW to help your clients address the concern of long term care. Please consider the Life/LTC hybrid product. It’s easily understood and makes the most sense in many scenarios.

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