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Linked-Benefits : Are They Part Of Your Business Plan?

They should be - more consumers are reading about them, as an alternative to Long-Term Care. They can be a solution to "I don't want to pay for something that I may never use" or when your clients are concerned about Long-Term Care premiums increasing over time.

It is first & foremost a Life Insurance policy that combines the features & benefits of Universal Life Insurance (*) and Long-Term Care Insurance. There are two basic product types:

  1. Asset-based plan - reimbursement policies using the leverage of a single-premium deposit to purchase a much larger pool of LTC dollars - usually several times the amount of the deposit. There is also a Life Insurance benefit paid, with some carriers providing a "Residual Death Benefit" so that a death benefit is paid even if all the pool of LTC $'s have been exhausted. Plus - these products generally offer a money-back guarantee.
  2. Ongoing premium-paying plan, that accelerates the death benefit either by reimbursement or a cash plan. These plans look just like traditional universal life, with a rider for chronic illness. Some carriers charge for the rider with the insured having access to the full death benefit whether for death or for chronic illness. Other carriers do not charge for the rider - & then offer a "discounted death benefit" in the event of payouts for Chronic Illness.

Buyer responses that can indicate interest in these products:

  • I do not wish to pay for something I may never use
  • I really don't think I'll ever need care
  • I am worried about rising LTC premiums late in life
  • I've thought about LTC, but have chosen to self-insure
  • I've got a CD or older Life policy with cash value built up

Like traditional LTC policies, there are different elimination periods, benefit periods & inflation riders.

Products/riders may not be approved in all states, please contact us for more information. 800-695-8224 x100 Dave.

(*) Hancock offers this on a Whole Life contract as well as Universal Life, National Life now offers a Chronic Illness rider on Term Insurance.