With long term care increasingly making news headlines and being discussed on social media, awareness of this growing crisis is increasing. So now might be a good time to take advantage of the groundswell and give your prospects and clients even more reasons to consider long term care insurance coverage. And one way to do that is by educating them about the flexibility and benefits of a shared care plan.
What is a shared care LTCI plan?
Shared care insurance is a type of long-term care coverage that allows married couples and domestic partners to purchase separate plans with an option for each partner to become a “rider” on the other partner’s plan. If one partner needs care and they’ve exhausted the benefits on their own policy, they can draw funds from their partner’s policy.
Here’s a hypothetical scenario…
Dan and Paula are an older married couple with identical long-term care insurance policies, but they didn’t get the Shared Care Benefit Rider. Both policies have a maximum monthly benefit of $6,000 x 60 months, for a maximum available benefit of $360,000.
Dan has some medical issues and has been using his $6,000 maximum monthly benefit for several years, and now has just $2,000 left in his total benefit pool. Paula remains healthy and hasn’t had to use any benefits from her pool – but again, they didn’t get the shared care benefit rider. So once Dan’s remaining $2,000 is used up, he and Paula will be forced to pay for the rest of his care from other sources such as any current income, savings, or other assets.
That could be a real hardship for a lot of couples. If Dan and Paula had purchased the shared care benefit rider, Dan’s ongoing care needs could be funded with Paula’s benefits.
The two big selling points for Shared Care LTCI Plans
First, a shared care plan essentially doubles the lifetime maximum for either partner if one should have a prolonged need for care. In Dan and Paula’s case, rather than each of them having a maximum available benefit of $360,000, they would each have access to a maximum benefit of $720,000.
Second, it’s a money saver. If each partner buys a three-year plan with a shared care rider, they both have the potential to access six years of coverage without each of them having to buy a higher priced six-year plan. In other words, Dan and Paula would pay less for a three-year, shared care option than they would if each of them bought a separate six-year plan for themselves.
Another advantage of share care plans is that when one partner dies, the other partner can generally access any remaining benefits their deceased partner had in their plan.
Who’s the ideal candidate for a shared care plan?
Shared care plans are especially suited to couples who have insurable assets and just want a basic plan that can help them pay for a few years’ worth of care without wiping out their savings and other assets. For couples who can’t afford, or don’t want to pay for, more costly traditional long-term care insurance plans, but who still want to have coverage, a shared care plan can be the ideal option.
With the need for long-term care on the rise, now’s the time to sell your prospects on the benefits of LTC insurance. To find out more about adding Shared Care Benefit Plans to your DI sales toolkit, email me.
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