Are all Policies the Same?
The answer is no. While policies typically share core benefits, they are not all the same. Most insurance agents and financial advisors know very little about designing a policy because the industry and the product features evolve rapidly. Often, they will develop a plan which costs much more than what you really need to spend, because they're not as familiar with how policies are being used at the time of claim.
First, insurance premiums are regulated, so no one individual insurance agent can "give you a deal." You can have three agents quote the same company and, if they are quoting the same benefit, the premium will be the same. Any premium differences will be due to underwriting class (preferred, select, standard, substandard), gender, spousal or partner discounts, the amount of benefit, and "riders" that are added to the policy.
With nearly 20 years of experience and thousands of clients nationwide, an authentic LTC Insurance Specialist like Matt McCann will ask you many questions about your health, family history, and future or current retirement plans. This information will help determine the amount of benefit you would need to meet your concerns and budget goals. Then, Matt will shop for the best coverage at the best value.
Some insurance agents can only market policies from one insurance company. Top Long-Term Care Specialists can usually compare rates from five to six insurers or more. Matt McCann represents all the major companies in the industry.
Also, premiums can vary over 100% between insurance companies for the exact same benefits. Matt will make sure you find the right plan at the best value.
Unlike other forms of insurance where you may benefit from changing insurers from one year to another, generally, you buy long-term care insurance only once. This is because premiums are based on the AGE and HEALTH you are at the time of your application—so it rarely pays to switch companies. That's why it's essential to ask your insurance professional if they can compare coverage from different insurers from the start.
There are several policy features (riders) that can be added (at extra cost) to a policy. Some of these riders to consider include inflation options and shared benefit options for spouses/partners.
Many states have partnership policies that provide additional dollar-for-dollar asset protection or "asset disregard." Some states have different requirements for inflation options for a policy to be considered a partnership plan.
Limited duration or short-term plans have smaller benefits but generally have less conservative underwriting requirements. They will also consider new applicants at older ages.
Single premium asset-based or so-called "hybrid" policies (life insurance with riders for long-term care) may have the same premium, but the benefit levels will differ. Underwriting will also vary from company to company. Some companies offer annuity-based policies with riders for long-term care as well. These generally will have less conservative underwriting.
A real hybrid Long-Term Care Insurance policy includes a 7702(b) rider. This means the policy meets the standard long-term care insurance guidelines. An accelerated death-benefit or chronic illness 101(g) rider cannot legally be marketed as Long-Term Care Insurance since the policy does not meet federal guidelines. Although these policies will accelerate an existing death benefit if you require long-term care, it will only return the death benefit and not provide any additional long-term care benefit. Often, these policies will require you to be terminal to qualify for the long-term care benefit.