Using Life Insurance for LTC: Pros and Cons


lifesaverThere are many ways to pay for long-term care, and one of them is a hybrid life insurance policy with long-term care benefits. These combination products are growing with popularity these days, and you might be considering this option too. But just like any decision related to long-term care, you need to carefully weigh the upsides and downsides of a particular payment method.

To help you determine if a hybrid life insurance policy can work for you, here are its pros and cons that you need to consider.

RELATED: 5 Ways to Fund your Long-Term Care Needs


“What if I never need long-term care?” This is the most common concern that people raise about traditional long-term care insurance. Usually, premiums paid into this policy will not be returned in case the policyholder has remaining benefits or never made a claim.

A hybrid life insurance policy eliminates this common qualm. When you are insured under a combination policy, you have access to long-term care benefits if you need them. In case you never do, the money will still be available to your heirs in the form of death benefits. Obviously, that’s a win-win situation.

With long-term care insurance, the usual case is this: It’s either you use it or lose it. Although not needing long-term care is a good thing, all those premiums paid in a policy that you never used may still feel like a great loss.


Long-term care coverage from a hybrid life insurance policy may not be as comprehensive as that of traditional long-term care insurance. Its coverage may be only good for a few years, typically between two to four.

If you think that you will need to rely on care services for an extended period of time, a combination product may not work best for your interest and may even cause you to make considerable out-of-pocket payments in the future.

Some people are mistaken that companies that offer combination life insurance with LTC benefits don’t look at an applicant’s health. They do, but their criteria are simplified and less strict as compared to the underwriting done for a traditional policy.

Knowing the best choice

fitting puzzle piecesThe first thing you need to determine is whether you need life insurance or not. It’s important to note that LTC benefits included in a hybrid policy are not merely incentives. So if life insurance is not suitable for you, a traditional long-term care insurance policy or self-insurance may make more sense for your dollars.

Knowing the best choice will always boil down to your choice. Treading though the different payment options for long-term care can be very challenging. Consider consulting with a professional so that you can make smarter decisions. Go for someone whose expertise includes the different products that can pay for long-term care.


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