- Are Linked Benefits an alternative to Long Term Care Insurance?
Yes. Linked Benefits may be an alternative to traditional or “standalone” Long Term Care Insurance. Some people choose Linked Benefits plans in an effort to safeguard themselves from paying premiums over time to an insurance policy they may not use for LTC expenses.
- What kind of policy are Linked Benefits categorized as?
Linked Benefits are considered Life Insurance policies (or, in some states, annuity contracts) that combine the features & benefits of Life Insurance (*) and Long-Term Care Insurance.
- How are Linked Benefits plans like Long Term Care insurance?
Like Long Term Care insurance, Linked Benefits plans are intended to help offset the financial impact of an extended care event, and may have different benefit amounts, elimination periods, benefit periods & inflation riders.
- What is an asset based Linked Benefits plan?
They are policies using the leverage of a single-premium deposit to purchase a much larger pool of LTC dollars - usually several times the amount of the deposit. There is also a Life Insurance benefit paid, with some carriers providing a "Residual Death Benefit" so that a death benefit is paid even if all the pool of LTC $'s have been exhausted. Plus - these products often provide a money-back guarantee.
- What is an ongoing premium paying Linked Benefits plan?
It is a plan that accelerates the death benefit either by reimbursement or a cash plan. These plans look just like traditional life insurance, with a rider that allows the policyholder to “accelerate” the death benefit and use the funds to pay for Long Term Care or chronic illness. Some carriers charge a premium for the rider with the insured having access to the full death benefit whether for death or for chronic illness. Other carriers do not charge a separate premium for the rider; rather, they offer a "discounted death benefit" in the event of payouts for Long Term Care or Chronic Illness.