Taking the Confusion Out of Linked Benefits
Q: What are Linked Benefits?
A: A Linked Benefits policy is a unique life insurance or annuity policy that allows you to protect your assets from a potential long term care (LTC) event and still leave a legacy to your loved ones without having to purchase two separate policies.
By paying an initial lump sum premium, you immediately create a death benefit for your beneficiaries and a pool of money to pay for covered long term care needs.
Q: What types of insurance products can be linked?
A: A base product such as life insurance or an annuity with a “rider” that provides long term care benefits if needed. This provides multiple benefits, paying out the first benefit, as needed. If you need long-term care, income tax-free reimbursements are available for qualified long-term care expenses.
Q: What does a Linked Benefit provide me?
A: Linked Benefits policy provides you with:
- A guaranteed death benefit that is generally income tax free – your beneficiaries will receive a death benefit even if you don’t use your LTC benefits or use some or all of it.
- Value for your money – typically, your death and LTC benefits are significantly greater than your initial premium.
- Flexibility – no matter what happens in your life, you will have a guaranteed level of benefits.
Q: Who should consider Linked Benefits?
A: If you are between ages 55 and 75 with investable assets (money that you won’t necessarily need to fund your retirement) and you want to insure against a time that might require temporary or permanent long-term care, then you should consider a Linked Benefit, especially with the potential for tax savings.
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