What to Know About Combination Insurance Policies

Policies that combine long-term care and life insurance coverage.nurse taking care of patient

Long-term care insurance is designed to help you cover the expenses associated with a chronic or ongoing medical condition.  For instance, this insurance can help you pay for stays in a nursing home or cover the cost of home healthcare services.  However, many people are wary about securing a long-term care policy because they aren’t sure if they will need it.  Fortunately, there are new insurance policies that combine long-term care and life insurance coverage to ensure that the policyholder gets some return.  Here’s what you need to know about combination policies.

  • What Are Combination Policies?

Insurance policies that offer coverage for long-term care and life insurance are known as combination policies.  These policies cover the long-term care expenses that regular health insurance or Medicare will not.  If you do not end up needing your long-term care coverage, then the insurance company will convert the money into a death benefit payable to your beneficiaries.

  • How Do They Work?

Depending on the specifics of your policy, you will pay a lump-sum premium or several large annual premiums (usually over the course of ten years or less).  Your policy will set aside a pot of money that you can use to pay for long-term care expenses.  Typically, this amount is equivalent to several times your premiums.

If you access your long-term care insurance, then your death benefit is reduced.  Some policies will guarantee a percentage of the full death benefit (usually around 10%), even if you use all the money allocated for long-term care.

  • How Do I Get One?

Every combination policy is different and therefore has different application requirements.  Some insurers will require you to submit your medical records and take a medical exam to qualify for coverage.  Other insurers offer simplified underwriting, which means that the application process is far less strict.  Please note that insurance companies that offer simplified underwriting may place limits on your coverage or charge more for coverage.  The average cost of a single-premium combination policy is about $75,000.

This is what you need to know about combination policies.  Do you have questions regarding your long-term care or life insurance needs?  If so, then contact the experts at ISU-Wissink Insurance in Culver City, California.  We are ready to get you the coverage that you need today.