Best Linked Benefit Long-Term Care Insurance
Linked-benefit policies, also called asset-based or hybrid life and long-term care insurance, provide money for long-term care if you need it. Or, they pay a death benefit to your beneficiary if you don’t max out the long-term care benefits. With some you can get your money back if you decide that you don’t want the coverage. Available from many insurers, these policies can vary significantly. Here are 10 reasons to compare linked benefit insurance plans before you apply.
- Your future life and long-term care benefit amounts can vary.
- What you’ll pay can differ for basically equal coverage.
- Discounts for couples can save you 5-10% (& not all offer discounts).
- Insurers can pay ‘lump sum’ benefits. Others reimburse after you submit bills.
- Available payment options vary. Would you like ‘paid-up at 65’?
- Deductibles range. Some only offer 90-days. Others have 0-day.
- With some, part of your premium payments may be tax deductible.
- Refund (Return of Premium) contractual limits are not equal.
- Growth of your policy benefit options can be 0%, 3%, 5%, etc.
- Some insurers offer coverage starting at age 30; others only at 40. They can stop accepting applications at age 75; others at 80.
Compare Linked Benefit LTC Before You Buy
There are significant differences between the growing number of linked benefit long-term care policies available today. Because you only buy coverage one time, it really pays to compare before signing on the dotted line. It almost never pays to switch from one policy to another.
We provide 4 real examples below. They are typical linked benefit policies offered by the 4 leading insurance companies.
You will see there are cost differences. Also, important differences in the way benefits are paid. Everything is defined by the contractual small print. Something you are unlikely to read until it comes time to make a claim. That’s why the Association strongly recommends speaking to a linked benefit specialist.
Connect with top national linked-benefit agents now. Complete the Compare Benefits form and submit.
Four Real Examples Comparing Policy Coverage And Costs
The following examples are for a 55-year-old male. Initial long-term care benefits are $4,000-per month growing at 3% yearly. At age 85, benefits will equal about $9,700-per-month. At age 90, benefits will equal about $11,250-per-month.
| Company | A | B | C | D |
|---|---|---|---|---|
| Yearly Cost | $6,100 (pay to age 100) |
Not available. 10-pay only ($10,500) |
$5,235 (pay to age 100) |
$5,387 (pay to age 95) |
| Maximum LTC Benefit | $753,627 (at age 85) Tax Free |
$753,627 (at age 85) Tax Free |
$568,801 (at age 85) Tax Free |
$706,974 (at age 85) Tax Free |
| Cash Surrender Value | $43,682 (after 20 years) |
$60,620 (after 20 years) |
$52,349 (after 20 years) |
$42,595 (after 20 years) |
| Death Benefit | $274,405 (at age 100) |
$104,000 (at age 100) |
$240,804 (at age 100) |
$100,000 (at age 100) |
Premiums as of March 2022 and subject to change. State of Maryland. Policy features, options and premiums can vary. Read your policy contract carefully.
Why One Linked Benefit LTC May Be Better For You
This is where the expertise of a specialist really benefits you. We have included a few reasons “why” various policies have features and options that may be of significantly greater value to you. It takes a real professional to understand and explain these differences.
Why Company A?
Benefits are paid monthly (‘indemnity’) without the need for you to collect and submit receipts for payment (‘reimbursement’). A special provision provides retroactive benefits back to Day 1 after you pass Day 90 of claim. Policy offers a larger ‘residual death benefit’ (remaining benefit after LTC claims have exhausted policy).
Why Company B?
While annual payments are not available, their 10-pay option is slightly less expensive than others. Policy offers a 0-Day Elimination Period option for home care and facility care.
Why Company C?
Has a higher Cash Surrender Value for those who think they may want that. Has fewer options for inflation growth of benefits, thus a lower potential maximum LTC benefit shown above. Company offers a choice of ‘reimbursement’ or ‘indemnity/cash’ benefit payout that can be selected at time of claim inception.
Why Company D?
Can use retirement (IRA) money with this company. Only insurer offering an ‘unlimited duration’ policy option where maximized coverage is desired.
