Jan 16th, 2025
Should Survivorship be added to my Long Term Care policy? Is it worth it? With the rise of hybrid policies in 2025, this question requires careful consideration.
What is Survivorship?
Survivorship is a rider (optional feature that costs additional money) that couples can add to their traditional Long Term Care Insurance policies. With Survivorship, when one spouse dies, the surviving spouse no longer has to pay their Long Term Care Insurance premium.
Important Note for 2025
Before considering a survivorship rider, you should first evaluate whether a hybrid long-term care policy might better suit your needs. Hybrid policies have become increasingly popular due to their guaranteed premiums and built-in death benefits, often making survivorship riders unnecessary.
Important Market Context for 2025
The long-term care insurance landscape has transformed dramatically. While traditional policies with survivorship riders once dominated the market, hybrid policies now represent over 85% of new long-term care insurance sales. This shift is primarily due to:
- Guaranteed premiums in hybrid policies
- Built-in death benefits that return premiums if care isn't needed
- More flexible payment options (single-pay, 5-pay, 10-pay, or lifetime)
- Cash indemnity benefits that don't require receipts or approved providers
What Companies Still Offer Survivorship?
While survivorship riders were common in the past, the market has shifted significantly. As of 2025, fewer companies offer traditional long-term care policies with survivorship riders. The main carriers still offering this feature include:
- Mutual of Omaha
- New York Life
- Several smaller carriers (availability varies by state)
Most policies require a ten-year qualification period, meaning both partners must maintain their policies for 10 years before the survivorship benefit becomes active.
Premium Considerations
When offered, survivorship riders typically add 15-20% to the base premium cost. For a couple aged 60, this might mean an additional $600-800 annually. Compare this to hybrid policies, where:
- Joint policies often cost less than two individual policies
- Premiums are guaranteed never to increase
- Return of premium features protect your investment
- Built-in death benefits provide value even if care isn't needed
Is Survivorship Worth It in 2025?
The value proposition of survivorship riders has changed significantly with the evolution of the long-term care insurance market. Here are key considerations:
Why You Might Skip Survivorship
- Hybrid Policies: Hybrid long-term care policies offer guaranteed premiums and death benefits, often making survivorship unnecessary
- Cost Efficiency: The extra premium for survivorship could be better invested elsewhere
- Market Changes: With fewer carriers offering traditional policies, hybrid options often provide better overall value
When Survivorship Might Make Sense
- If one spouse has significant pension or Social Security income that will stop upon death
- When there's a large age gap between spouses
- If you specifically want traditional LTC insurance and plan to keep it long-term
Modern Alternatives to Survivorship
The market now offers superior options for couples:
1. Joint Hybrid Policies
- Companies like OneAmerica offer shared care with unlimited lifetime benefits
- Both spouses share one large pool of money
- Surviving spouse retains access to unused benefits
- Cash indemnity payments available
2. Individual Hybrid Policies
- Guaranteed premium rates
- Return of premium options
- Built-in death benefits
- Optional inflation protection
3. Linked-Benefit Solutions
- Combines life insurance with LTC benefits
- Typically offers more flexible payment options
- May provide better tax advantages
- Often includes return of premium features
Making the Right Choice in 2025
When evaluating your options, consider:
- Premium Stability: Traditional policies with survivorship riders may still face rate increases, while hybrid premiums are guaranteed
- Benefit Flexibility: Modern hybrid policies often offer more ways to access and use benefits
- Financial Security: Built-in guarantees and death benefits provide better value protection
- Care Options: Cash benefits in many hybrid policies allow more flexibility in choosing care providers
Tax Considerations
Unlike traditional policies, hybrid policies often offer:
- Tax-free benefits for long-term care
- Tax-free death benefits to beneficiaries
- Potential 1035 exchange options from existing life insurance or annuities
- More favorable treatment of premium payments
The Bottom Line
While survivorship riders were popular in the past, the long-term care insurance market has evolved significantly. Before adding a survivorship rider to a traditional policy, consider whether a hybrid policy might better serve your needs. These newer products often provide more comprehensive benefits and guarantees without the need for additional riders.
For a detailed comparison of current options, including hybrid policies with built-in protections, get a free quote here.
Remember: The best choice depends on your specific situation, health, and financial goals. Consider consulting with a long-term care specialist who can compare both traditional and hybrid options to find the most suitable coverage for your needs.
Questions to Ask Your Agent
When discussing your options, consider asking: 1. What are the total costs over 20 years for each option? 2. How do the benefits compare between traditional with survivorship vs. hybrid policies? 3. What happens if we never need care? 4. Are there any rate guarantee periods? 5. How are benefits paid out when needed?
Remember: The best choice depends on your specific situation, health, and financial goals. Consider consulting with a long-term care specialist who can compare both traditional and hybrid options to find the most suitable coverage for your needs.
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