You probably know about hybrid cars. But do you know about about hybrid life insurance?
How It Works
Most people bought long-term care insurance as a standalone policy in years past. Today, it’s becoming more common to buy the coverage as a policy that also includes life insurance.
The long-term care portion of the policy pays for care if you develop a health condition and need care. Meanwhile, the life insurance portion gives your loved ones financial support if you were to pass away.
You receive the long-term care benefit if you develop a health condition. And your loved ones get the full death benefit if you never use the long-term care benefit.
10 Advantages of a Hybrid Life Insurance Policy
- More complete coverage. A hybrid life insurance with long-term care policy lets you—and your loved ones—benefit from two very important coverages.
- Easier to get. The medical underwriting for a hybrid life insurance policy is often more relaxed than for a standalone long-term care insurance policy. In fact, some hybrid policies only have you answer a few health questions.
- Flexible payment options. There are two ways to pay for a hybrid life insurance: with a lump sum or with annual payments.
- Tax savings. Life insurance payouts to your loved ones aren’t taxed. And premiums paid for long-term term care insurance can sometimes be deducted from your state and federal taxes.
- Less time and effort. It’s often easier to research, buy and manage one policy than two separate policies.
- Fewer premium hikes. Many people worry about cost. That’s because standalone long-term care policy premiums could increase dramatically. Hybrid policies typically offer more pricing stability.
- Possibility of a death benefit. Typically you forfeit the premium dollars you’ve paid for a traditional policy if you never need long-term care. With a hybrid policy, your loved ones receive the full death benefit if you never need long-term care. Some policies even guarantee a small death benefit no matter what.
- Option to lock in your premium. Some hybrid life insurance policies let you lock in your premium payments.
- Option of a money-back guarantee. Some hybrid policies return the premium paid if you decide you don’t want the policy after a set time.
- Ultimate peace of mind. Hybrid life insurance coverage erases worries about potential long-term care costs and helps ensure your family’s financial future. Who doesn’t need that?
A licensed insurance professional can help you determine if a hybrid or a standalone policy is the right fit and find one that works with your life and budget.