Long Term Care / Long Term Care Insurance

Hybrid Long Term Care Insurance

Actuaries miscalculated when insurance companies first started selling Long term care insurance (LTCI). As insurance company losses mounted many purchasers faced unaffordable increases in their annual premiums. Rather quickly the number of companies offering LTCI shrunk from about 100 to a dozen as it became clear that the product was not properly priced.
Now a variation combines annuities or whole (or universal) life insurance with LTC protection. These hybrid policies are worth considering.

A blog with reliable, understandable information about LTCI and the new hybrid policies is: https://www.insuranceandestates.com/long-term-care-insurance/
The site explains the pros and cons of buying LTCI vs. combining LTC protection with an annuity of whole life coverage. One of the main drawbacks of the hybrid policies is that they typically require a single, large, upfront premium compared to a yearly premium for traditional coverage. The disadvantage of the lower annual premium is that companies can raise the premium whereas a one time payment provides cost certainty.

Hybrid policies offer: Life Insurance with Long Term Care Rider or Chronic Illness Rider

The site provides information on the 10 best (highly rated by independent raters) insurance companies and plenty of information that consumers should read before talking to any sales persons.  Be sure to read through the entire website for in depth information and check out AARP info. Due to the large upfront premium for hybrid LTCI policies, thorough due diligence is essential. Keep in mind that insurance agents are sales people working on commission. 

Another reliable source providing an overview of the new hybrid policies is AARP: https://www.aarp.org/caregiving/financial-legal/info-2018/long-term-care-insurance-fd.html

5 Things You SHOULD Know About Long-Term Care Insurance

Source: Financial Planning for Women