People shopping for a long term care insurance policy will notice that there are a lot of different choices, many of which can be confusing to those who have never dealt with this type of policy before. One option in particular, the Guaranteed Purchase Option, is often offered as a rider, but young buyers should stay away from this rider to avoid future financial disaster.
The Calendar Day Rider on Long Term Care Insurance is one of those things that could be labeled as “fine print” on most policies. Some companies, like Mutual of Omaha, include it automatically. It’s extra with the Genworth Long Term Care Insurance product. Others require extra premium for the luxury of having calendar day elimination periods.
We got a call from a client in Washington who was 59 and comparing Long Term Care Insurance options. She rattled through a list of benefits like payment duration, daily benefit amount, and then got to inflation protection. She dropped the 5% simple bomb without missing a beat and we continued on.
Should Survivorship be added to my Long Term Care policy? Is it worth it? Read on for answers to these questions, and some “back of the envelope math” as well.
What is Survivorship?
Summary: Survivorship is a rider (optional feature that costs additional money) that couples can add to their Long Term Care Insurance policies.
There are three incarnations of Return of Premium, and each company selling Long-Term Care Insurance coverage will offer at least one:
Full Return of Premium
1) Return of Premium, often referred to as “full return of premium,” will give your beneficiary a death benefit equal to the sum of your LTC premiums paid over time.