Long-Term Care Hybrid Products May be Another Option for Buyers

Insurers are rolling out new products that combine long-term care insurance with either a life insurance policy or an annuity. These new products have been on the market for awhile, but they are gaining in popularity due to a law that goes into effect Jan. 1, 2010, making distributions from life insurance and annuities tax free when used to pay nursing home costs.

Even though long-term care costs continue to rise, some consumers may hesitate to purchase long-term care insurance. Many people do not want to pay premiums for something they might not need. A hybrid product has the benefit of combining two products into one. If you don't use the long-term care insurance, you can still benefit from the life insurance or the annuity.

The products vary in the details, but the general idea of a hybrid life insurance policy is to allow a buyer to purchase a cash-value life insurance policy and to use a portion of that policy for long-term care benefits, if necessary, and keep the rest as a death benefit that will be paid to the purchaser's beneficiary. If long-term care benefits are used, the death benefit may be reduced.

Hybrid annuity products also vary significantly, but in general they allow a buyer to purchase a fixed deferred annuity with a long-term-care rider attached. The annuity may pay out for a specific number of years or for life. For example, a purchaser could deposit $150,000 into an annuity. The annuity would provide approximately $4,700 a month of long-term care benefits for 36 months. For an additional cost, the purchaser could get the $4,700 monthly benefit for life.

While a two-for-one product may seem attractive, these products are not for everyone. For one thing, you may have less flexibility with a combined product than you would with a stand-alone product. Hybrid products may not cover home care or include inflation protection, for example.

In addition, hybrid products may not offer enough long-term care coverage for what you need. It is impossible to predict exact coverage needs, but click here for more information on how to figure out how much insurance to purchase. A hybrid product is likely less expensive than purchasing two separate products, but it is often more expensive than purchasing a stand-alone long-term care insurance policy.

As with any major purchase, you need to evaluate it carefully before purchasing. Before deciding what to buy, get advice from a Long-Term Care Specialist.

For more information on long-term care insurance, Visit: Long Term Care Insurance Pros

Long-Term Care Insurance and What Consumers are Paying

In gathering information from Partnership States, the American Association for Long-Term Care insurance shed some light on the subject of what people pay for long-term care insurance protection. It clearly shows that the majority of consumers are spending far less for long-term care insurance protection than what is reported in the consumer media.

The following data is based on over 70,000 individuals (under age 61) purchasing Partnership long-term care insurance policies between January 1, 2009 and June 30, 2009.
Premium Amount Percentage

• Less than $500 18.1%
• $500 - $999 33.2%
• $1,000 - $1,499 11.1%
• $1,500 - $1,999 10.2%
• $2,000 - $2,499 7.6%
• $2,500 - $2,999 6.0%
• $3,000 - $3,499 4.7%
• $3,500 - $3,999 3.3%
• $4,000 and Over 5.3%

Why are these numbers so important?

Because a number of organizations reported to the media that the average cost is much higher than what is documented here. It is important to get the facts when doing your Long-Term Care Planning.

Long Term Care Insurance Pros is working hard to properly educate consumers and other professionals on Long-Term Care Care Financing and Planning.

For more information: Visit Articles and Resources on Long-Term Care Planning

How to Evaluate Long-Term Care Insurance

Whether from the personal experience of a loved one or via the comparatively easier exposure of a friend's story about his parents, a prolonged health decline by someone you know is not an easy process to observe, let alone be touched by. While the non-financial implications are great, the monetary consequences of extensive medical care can be equally as meaningful. In recent years, the long term care insurance industry has grown significantly and now plays a major role in this life stage.

Unfortunately, like many relatively new products, the industry is still finding its footing and apples-to-apples comparisons of policies are still difficult. Furthermore, premiums can be extremely expensive, especially for those first looking to acquire a policy late in life. Nonetheless, long term care insurance is worthy of your time and consideration. Whether you opt to purchase the product or pass, it is critical to make a conscious decision to address the possible financial implications of long-term care.

Schedule a consultation with a Long-Term Care Specialist!