Given: Prior to a companies’ rate increase you can purchase a greater monthly LTC benefit amount than you can after the rate increase – for the same premium.
Truth #1: However, consider that these companies offer vested options with 100% Guaranteed Return of Premium available after X number of years. This means even though your clients will pay a higher premium after an increase, they still have a guaranteed right to receive up to 100% return on the higher premium they paid. (Plus leverage their premium dollars for LTC benefits).
Truth #2: Price is one of many factors that can help determine which Hybrid LTC is the right fit for your clients. How long has the company been in this market? What is their Comdex Rating? Is it Indemnity or Reimbursement? What are the current maximum issue ages and options for older ages? What Inflation or extended pay premium options are available? How long of an LTC benefit duration is needed? Is the LTC benefit amount appropriate at age 80?
Run or Walk: Hybrid LTC products can be an awesome solution for your clients addressing their concerns on health and death. We are in a historically low interest rate environment in the middle of a pandemic. Whether you decide to run or walk, it’s a good time to consider these products. Here are some recent pricing actions:
|Carrier Name||Rate Increase*||Date|
|Lincoln||Up to 20%||06/15/2020|
|Pacific Life ( Priemier Care Choice)||Up to 20%||06/15/2020|
|Securian||Up to 13.5%||07/18/2020|
|Nationwide Life||Up to 14%||05/11/2020|
*Actual rates can vary depending on premium pattern, age, sex, inflation options or other factors. See companies’ announcement for details on rate change and transition guidelines.