Weekend Reading: How Hybrid Life Insurance Pays for Long-Term Care

This article appears as part of Casey Weade's Weekend Reading for Retirees series. Every Friday, Casey highlights four hand-picked articles on trending retirement topics and delivers them straight to your email inbox. Get on the list here.
Weekend reading how hybrid life insurance pays for long term care Weekend reading how hybrid life insurance pays for long term care
Weekend Reading

If you don’t have a plan for covering long-term care, it might be time to reevaluate. According to the Administration for Community Living, someone turning age 65 today has a nearly 70 percent chance of needing some form of long term care support in their remaining years.


Traditional coverage: It’s important to note that Medicare only covers short stays in nursing facilities. Plus, Medicaid requires strict income and asset limitations to kick in. This is where long-term care insurance steps in. Traditional long-term care insurance policies have recently seen premium hikes, leading to a negative perception of these plans. Additionally, these policies hold a "use-it-or-lose-it" proposition, and if care is not needed, the premiums paid may feel wasted.

An alternative option: Hybrid long-term care insurance offers long-term care coverage if needed or a death benefit if not used for care expenses. It has several advantages, such as consistent premiums, flexibility in payment options, easier qualification and the ability to pay family caregivers. However, hybrid policies may not always provide the best coverage for the price, have longer elimination periods before benefits kick in and can reduce cash value and death benefits when long-term care payouts are used.

You don’t want to be left looking for long-term care coverage when it’s too late. Hybrid life insurance might be an option worth considering, but it’s important to consider how the pros and cons apply to your unique situation first.