Trending Benefit: Life Insurance with Long-Term Care Coverage

The Trend:

Larger employers, with employees in multiple states are quickly adding Life Insurance with Long-Term Care coverage to their employee benefit programs.

Why?

The benefit is a cornerstone to financial wellness, by providing “2 in 1 Protection” with:

•        Permanent Life insurance which provides permanent coverage which can be taken into retirement, at the same cost as when working, unlike Term Life Insurance

•        Provides valuable Long-Term Care coverage that can help protect assets, by providing a source of funding the cost of care, rather than depleting savings, retirement account, or assets to pay for the cost of care.

Over 26 states are considering, or have enacted, a Long-Term Care payroll tax.  Washington State was the first to enact.  Washington State provides a payroll tax exemption to those that own Long-Term Care coverage, including Life with Long-Term Care products, prior to November 1, 2021. This opt-out provision was for a limited time and is no longer available.

It is believed that most states will allow similar exemptions to the LTC payroll tax, provided that the Long-Term Care coverage is in place prior to the state enacting the payroll tax legislation.

Did you know?

•        The cost for Long-Term Care services is expected to more than double by 2051. 

•        The current cost of care can easily exceed $10,000/month in the Northeast.

•        Care on average is needed for 3 – 4 years, resulting on a financial exposure of $360,000 to $480,000 on average.

•        Long-Term Care services are generally not paid for by Disability, Medicare, or Health Insurance

•        Almost 70% of Americans turning age 65 can expect to use long-term care services during their lives, but only 1/3 of Americans have set aside money to protect themselves should the need arise.

Considering adding Life Insurance with Long-Term Care coverage to your Employee Benefit Offering?

Product design, underwriting offer, and plan pricing are important factors to consider. Employee education and appropriate long-term care enrollment tools are crucial to the success of the program.

Most States require the Broker or Consultant meet specific Long-Term Care licensing requirements.

Navis Benefits Group, LLC offers over 26 years of Long-Term Care, and Voluntary Benefits expertise.