Life Insurance with Long-Term Care Riders

The passage of the Pension Protection Act of 2006 (PPA) opened the door for "hybrid" life insurance/long-term care insurance products.

Life insurance/Long-term care products offer the benefits of a life insurance policy:

  • principal of which is an income tax-free death benefit
  • plus an additional source of funds in the event long-term care is required.

In addition, because of the more rigorous underwriting performed in connection with the sale of life insurance, life insurance/long-term care policy owners are generally eligible to receive long-term care benefits immediately-subject, of course, to any elimination period-rather than after a lengthy waiting period.

Life insurance/Long-term care benefits are paid:

  • first, as accelerated death benefits until the death benefits are completely accelerated; and
  • second, under an extension of benefits rider that continues to pay long-term care benefits at the same maximum level for a selected period after death benefits have been completely accelerated.

 Contact us today to explore your options to plan for long-term care utilizing a "hybrid" life insurance/long-term care strategy.

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