SOURCE: American Association for Long-Term Care Insurance

American Association for Long-Term Care Insurance

November 11, 2013 10:18 ET

Long Term Care Insurance Combination Policy Benefits Vary Widely

Comparing Hybrid Life Insurance Policies Combining Long Term Care Benefits Is Essential Says American Association for Long Term Care Insurance Report

LOS ANGELES, CA--(Marketwired - Nov 11, 2013) - Life insurance policies that offer long term care insurance benefits are gaining popularity but your future payouts can vary significantly according to a new analysis.

"Interest in hybrid life insurance policies that provide a death benefit to your heirs plus long term care benefits to you if you need them is growing," explains Jesse Slome, director of the American Association for Long-Term Care Insurance (AALTCI). "The guarantee that you'll use the coverage is an attractive proposition but your future payouts, the policy guarantee provisions and even the qualification processes can vary widely, something few consumers are aware of."

Traditionally, these combination life insurance policies, also referred to as hybrid long-term care insurance, have required a one-time premium payment of $75,000 to $100,000 or more. "Insurance companies are introducing lower-cost options that permit annual or multiple payments," Slome notes. "We expect sales of combination long-term care products to grow over the next five years as more life insurance companies add a long-term care (LTC) benefit option to new or existing policies."

47 Percent Less Long Term Care Cash; 17 Percent More Death Benefit

Someone buying a combination LTC policy at age 60 will likely live and start needing long term care at age 85, Slome suggests. "Our analysis found that one combination policy will pay a maximum monthly long term care benefit of $10,846 at age 85 while another will only pay $5,731, some 47 percent less," Slome reports. "If you die at age 85, the first policy pays a death benefit of $128,057 while the second pays 17 percent more ($150,374). If you are about to pay $100,000, it certainly is worth doing some comparison shopping."

One of the features consumers find attractive with combination LTC policies is the guaranteed return of premium. "The money back option is a big selling point," Slome says. "Again, the contractual language governs how this works. Deposit $100,000 with one company and you can get it back but only for 15 years after which the payback declines to $80,000 in year 16. Another won't pay back the full $100,000 until the fifth year."

Not everyone will qualify for a combination life plus long-term care policy and some insurers now have age limits. "There are still health standards to meet," Slome shares. "A phone call typically suffices with one company while another requires para-med exams plus contact with your doctors. Ask what you can expect before starting the application process."

Financial advisors are increasingly offering combination long-term care insurance policies as an alternative to traditional long-term care insurance. "An experienced long-term care insurance specialist will typically be knowledgeable in both and will have access to combo products from multiple insurers, but you need to ask," Slome advises. 

The Association suggests three questions to determine expertise in the field. Do you offer both traditional long-term care insurance and combination long-term care policies? How many years have you focused on long-term care planning? How many long-term care insurers are you appointed with? 

To learn more about combination long term care insurance policies or to request policy comparisons call the American Association for Long-Term Care Insurance at (818) 597-3227 or visit their website at

Contact Information

  • American Association for Long-Term Care Insurance
    (818) 597-3227