Current Trends in Long-Term Care Expense Funding
Have you been thinking how you are going to pay for long term care expenses, if the need were to arise?
Probably! But, you are concerned about the long term care insurance marketplace regarding insurance companies leaving the market or increasing rates. You might have seen that the FEDLTCI program was hit with an 83% rate hike in September of 2016.
According to the National Association of Insurance Commissioners, the number of Long-Term Care Insurance policies being sold in the U.S. is drastically reducing. The following is a chart from the NAIC Center for Insurance Policy and Reach) In 2014, the number of LTCi policies sold in the U.S. was only 129,000.
So, what are your options? Hybrid life insurance with accelerated death benefits and extension riders is on the rise. Here are a list of 5 reasons why there is a huge shift in this direction to cover long-term care expenses.
Hybrid Life Insurance (Dual Purpose Life Insurance)
- Provides life insurance death benefits
- Provides living benefits for long-term care expenses
- Cash-in option, assuming cash build-up and surrender charge period is completed
- Paid-up life insurance option, assuming cash build-up
- Pays life insurance policy amount at age 100, minus any withdrawals
Think about it, buying long-term care insurance only pays if you use it for long-term care expenses. USE IT OR LOSE IT!
Here is an example of the shift report by the NAIC’s Center for Policy and Research.
Please note, if you are member and wish to apply for life insurance amounts over the guaranteed issue amount for you and/or your spouse, paper applications must be used.