The Right Hybrid LTC Policy For You

Finding the Perfect Hybrid LTC Policy

No one wants to imagine themselves or their loved ones needing long-term treatment for an illness. However, as retirement age approaches, it is vital to plan for the future. You may have questions or concerns about long-term care plans and life insurance for seniors. 

With so many different policy options, there are a lot of things to consider, such as coverage levels and policy features. It’s a good idea to understand your financial condition and how long-term care insurance plays into it before you start shopping. It’s also a major financial investment, so make sure the coverage you select provides the security you need at a price you can afford. 

Conventional long-term care insurance plans offer coverage in the event you or a loved one needs long-term care. That said, the money is often perceived as “wasted” if you do not use the policy. However, hybrid life insurance is becoming more common because it includes two ways to collect the money and insurance benefits.

What is Hybrid Long-Term Care Insurance?

In a nutshell, a hybrid long term care policy combines life insurance and long-term care insurance to address some of the uncertainties associated with conventional policies. The result is a more flexible policy that guarantees you or a loved one will receive coverage depending on the premium you pay. 

For a hybrid policy, premiums are charged over a set period. This can be all at once or for a period of five to ten years. This way, you don’t have to think about getting enough money to cover premiums in 20 or 30 years. Additionally, the premium is also fixed and cannot be raised. 

Traditional long-term care insurance benefits (and the premiums you pay into the policies) are often “lost” if you do not need long-term care. That said, hybrid life insurance provides an appealing alternative. You can collect the insurance benefits if long-term care is needed with hybrid life insurance. 

If you do not need long-term care (or if you do not use all your qualifying benefits/money), your loved ones will collect the remaining balance of the life insurance portion in the form of life insurance payout. With this type of coverage you will recoup your premiums paid if you use the long-term insurance, or through the life insurance benefits, or a combination of the two.

What is a Long-Term Care Insurance Policy? 

Long-term care policies are intended to help with the six main tasks of everyday living: dressing, bathing, toileting, transferring, eating, and continence. If you are unable to perform at least two of the six tasks without substantial assistance, you will most likely need long-term care. The necessary treatment may usually be given in your own home or in a facility such as an assisted living facility, nursing home, or hospice. 

Long-term care insurance will help you pay for the care you require in any setting you choose. Over time, you pay a premium for the coverage. The program will then pay for or compensate you for any or all of the long-term care expenses if you need it. A long-term care policy is a form of health insurance that can be obtained to assist you in avoiding high long-term health care costs. When we get older, the likelihood of needing long-term care rises. Increased risk makes long-term care insurance a critical financial strategy to consider. 

Traditional long-term care insurance plans function similarly to auto or home insurance policies. You pay a premium for the duration of your plan and receive benefits when you need them. You cannot recoup your premiums if you do not need the benefits. While this is acceptable for auto insurance, the higher premium and longer payment period will make the costs more difficult to justify if you do not need long-term care. The premiums are not fixed and are subject to increase in the future.

Traditional plans, on the other hand, typically have lower initial premiums as compared to other options. They may also be eligible for state partnership services, which allow you to cover more of your assets if your long-term care insurance benefits run out and you need to turn to Medicaid.

Any of the following plans can be combined in hybrid long-term care insurance:

  • Traditional long-term care insurance
  • Short term care insurance
  • Linked benefit life / long-term care insurance
  • Long-term care riders
  • Chronic illness riders
  • Group/multi-life policies
  • LTC annuities
  • Impaired annuities

Since many people are worried about losing the money they have invested in long-term care policies if they do not use it, hybrid long term care insurance provides a solution that guarantees this money is not lost.

Who Needs a Long-Term Care Insurance Policy? 

The need for long-term care insurance varies according to age and health. If you are at high risk of contracting a serious or chronic illness that necessitates long-term care or nursing aid, you should consider long-term care insurance. 

Even if you are in good health, you will want to consider long-term care benefits as you approach retirement age for peace of mind. You never know when the worst will happen and believing you can afford long-term care is always well worth the investment.

What to Look for in a Hybrid Long-Term Care Policy?

When looking for the best long-term care package, keep the particular health conditions in mind. Are you at risk of sustaining an injury that would necessitate intensive treatment? Do you want to be completely safe in case anything bad happens? Do you have any funds set aside that could be used to provide care? 

When deciding on the best long-term care strategy, you should consider your current health, financial status, and age. When choosing a hybrid policy, you should carefully examine the policies to ensure they have the full range of benefits you need. It is often a good idea to compare plans in order to fully understand the variability in monthly rates as well as the services provided.

Here’s a short checklist of things to look for when looking for the best long-term care hybrid policy: 


The disadvantage of hybrid long-term care plans is that they can be far more expensive than conventional life insurance or long-term care policies on their own. This makes sense because hybrid insurance combines both services. However, the initial premiums is typically $75,000-$150,000 per person upfront and then your coverage is paid off for life.

Although certain hybrid insurance plans require a large upfront lump-sum fee, others allow you to pay an annual premium over five or ten years–then it’s paid off. Those premium payment options could be more manageable depending on your financial situation. When evaluating plans, always make sure to look at how premiums are calculated. 


Benefits differ from policy to policy in several ways. You’ll find that different plans have different incentives and may have limits on how much money can be withdrawn at any given time. Until signing off on a policy, go through the rules again.

Second, most hybrid long term care insurance plans have a 90 day elimination period during which you or Medicare pay the first 90 days. There are three plans that do not have a 90 day waiting period but might provide less benefits in other areas. Some companies will even send a full reimbursement on day 91, for those first 90 days of care received.

Finally, you can compare the various disbursement options from policy to policy. Others will limit the amount of long-term care you may get. While some will encourage you to invest your entire savings on long-term care, leaving little for life insurance for your loved ones. Although there is no right or wrong response here, you must make the best decision for yourself and your family. It is important to carefully weigh your choices.

Time of Purchase:

While retirement age is an ideal time to search for hybrid life insurance long-term care plans, you can get a head start and save money on premiums now if you buy this in your late forties or fifties. In general, the longer you wait to buy a long-term care insurance policy, the higher your premium will cost. Since becoming older is associated with more severe health problems, premiums start to rise as you get older. Locking in a premium between the ages of 50 and 65 will save you thousands of dollars in premiums.

How Do You Build Hybrid Long-Term Care Insurance Policies? 

There are some things you need to know about hybrid long-term care insurance policies. The word “hybrid long term care insurance” refers to any insurance policy that blends the benefits of a life insurance policy with a long-term care rider. 

You should be aware there are two forms of “hybrid” long term care insurance plans. 

  1.  Life Insurance Acceleration Only Hybrid Policies – focused on life insurance 
  1.  Life Insurance Acceleration + Long-Term Care Extension of Benefits Hybrid Policies with optional Long-Term Care Inflation Cover – focused on long-term care insurance

The main goal of the life insurance acceleration only hybrids is to leave a life insurance payout to your heirs. Within these policies, the LTC Rider is a “oh, by the way” rider. So, for you, the need for life insurance comes first, and the need for long-term care is a passing “what if I need care?” thought. With these plans, you get more health insurance while paying less for long-term care.

Inflation Protection rider:  Would you like to raise your benefits to keep up with rising healthcare costs? Most plans have this rider added and it will increase you benefits 3% compounded each year. This will ensure your benefits grow over time to keep pace with rising costs.

Your premiums will be determined by your responses to these benefit choices. Flexible financing options are available for hybrid plans, allowing you to finance your policy in a variety of ways. Your policy can be financed with a single premium payment or installment payments spread out over 5 years, 10 years, until you reach the age of 65, or until you reach the age of 95.  Most however will choose the single premium, five or ten year pay. You may use a 1035 tax-free exchange of cash value from a life insurance policy to fund a hybrid long term care insurance plan.

Put Your Insurance Needs in the Right Hands 

Consider which long-term care insurance policy is best for you to help you assess the financial aspect of your decision and determine your goals. Consult with one of our licensed insurance experts here at Policy Zoom who will provide useful information about the costs of treatment in your area as well as the cost of insurance. 

Discuss your goals and financial status with your family as part of your decision-making process. It is important to inform family members about the type of treatment you prefer and to seek their advice about the best and most practical ways to prepare for it. Not only can the talk help you explain your plans, but it will also help your family understand your wishes and the form of coverage that is available to assist you.

When selecting hybrid life long-term care insurance plans, it is critical to think about which benefits and incentives that are most valuable to you. There is no one company that has it all. Some give richer life insurance benefits while others give more long term care insurance.

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