Long Term Care Annuity Products, Companies and Quotes
Long Term Care Annuity Definition
A long term care annuity is a type of long term care hybrid product. By definition it is an annuity with a long term care rider. These policies have gained significant popularity in recent years.
Long term care annuities are also referred to as asset based long term care plans. The term asset based is because they are funded with assets rather than ongoing premiums. For those with the assets to fund this type of policy there can be significant advantages. Linked benefit long term care plans is also a synonymous term for long term care hybrid products. Linked benefit referring to the long term care insurance linked as a rider with the annuity.
How A Long Term Care Annuity Works
Long term care annuity hybrid policies combine an annuity with a long term care rider. The policy creates a pool of money to cover long term care costs. Annuities with long term care benefits include the advantages of a traditional annuity, with the added benefit of long term care protection.
A popular way to fund a long term care annuity is by repositioning an existing annuity or other existing asset. Such as bank CDs, savings, annuities, life insurance, IRAs or retirement plans. You may be able to increase your current return while protecting yourself with tax free long term care benefits.
Long Term Care Annuity Advantages
No Premium Increases – Long term care annuities can be funded with a single premium payment. This gives you the benefit of never having to be concerned about future premium increases. With traditional long term care insurance, guaranteed level premiums are typically not available. Knowing you will never have premium increases can be a significant advantage of a long term care annuity. Avoiding unexpected premium increases can provide peace of mind beyond the long term care protection.
Simplified Health Requirements – Long term care annuity policies may also have less stringent underwriting criteria compared to traditional long term care insurance. This can make an annuity with long term care benefits a great fit for someone who cannot health qualify for traditional long term care insurance.
Premiums Invested Are Not Lost – Unlike traditional long term care insurance, premiums invested are not lost if you do not use your long term care benefits.
Best Long Term Care Annuity Companies
As independent insurance brokers, we constantly compare the best long term care annuity products. Currently there are two insurance companies with strong LTC annuity products we recommend:
The State Life Insurance Company
The State Life Insurance Company, a OneAmerica Company, offers several different Annuities with Long Term Care benefits. These long term care annuities allow you to better use assets you may have designated for long term care. You can use the annuity’s value to cover your first few years of care, and then protect yourself beyond that with an optional coverage extension. Access to your long term care benefits can even be income tax-free.
State Life’s Financial Ratings
A.M. Best | A+ (Superior)
Standard & Poor’s | AA- (Very Strong)
Global Atlantic Financial Group
Global Atlantic Financial Group offers the ForeCare fixed annuity that includes a long term care benefit. The LTC benefit can protect you should you suffer a health event requiring long term care. With the Gobal Atlantic ForeCare annuity, you get all the benefits of a fixed annuity, such as income options, tax-deferral and a death benefit that passes any remaining contract value to your named beneficiary at death. You also get financial protection at two or three times the contract value for long term care expenses.
Global Atlantic Financial Ratings
A.M. Best | A- (Excellent)
Standard & Poor’s | A- (Strong)