To protect against the risk of needing costly long-term care an increasing number of national insurance companies are offering protection that combines life insurance with potential long term care insurance benefits. According to the 2012 Buyer Study conducted by the American Association for Long-Term Care Insurance, these linked benefit (also called “combination”) products are gaining favor with individuals in their 40s and 50s.
The Association’s annual study of leading insurers found that 53 percent of buyers of these hybrid policies were under age 65 in 2011 compared to only 48 percent in 2010. Some 42.5 percent of male and 38.5 percent of female buyers were between ages 55 and 64 explains Jesse Slome, director of the national trade group. Nearly one in 10 buyers was between 45 and 54.
“A linked benefit policy has advantages that many pre-retirement consumers find attractive,” Slome notes. Policies can fund expenses when qualifying long-term care is needed at home or in a skilled care facility. Some linked, or hybrid products, allow unused benefits to pass to named beneficiaries income tax-free. “At a time when long-term care is increasingly top of mind, these life insurance-based solutions avoid the ‘use it or lose it’ risk associated with traditional long term care insurance,” says Chris Coudret, CLU, ChFC, Vice President, OneAmerica one of the nation’s leading insurers offering linked benefit solutions. “In most cases, people make a single payment, effectively removing the risk of future premium increases.”
The AALTCI study reported sales for the participating linked benefit insurers increased 14 percent in 2011 and the premium increased almost 20 percent. To learn more or obtain long term care insurance costs from an Association member call (818) 597-3227 or visit the organization’s website www.aaltci.org.
Established in 1998, AALTCI is the national trade organization established to create heightened awareness regarding the importance of planning for long term care. To access or read three free consumer guides outlining ways to reduce costs for long-term care insurance visit the Association website http://www.aaltci.org/long-term-care-insurance-costs/
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