We have shared with you the statistics that support the need for long-term care planning, and you have now seen the Cost of Care Calculator. So how does John Hancock address the long-term care need in their product offerings?
Their Long Term Care Rider can be added to any individual permanent life insurance product and it is approved for sale in all 50 states. The rider provides a dollar for dollar acceleration of the death benefit to pay for qualified long term care expenses. They utilize a reimbursement model for the rider, which means they will handle all of the claims administration directly with your client's care provider on their behalf. At policy issue clients simply elect 1, 2 or 4% of their death benefit as their Monthly Maximum Benefit Amount available to cover expenses, up to a $50,000 per month maximum.
So, what is the cost? Take a look at the chart below. You may be surprised to learn that the average cost to add this rider to a life policy is 7–9%.
$500,000 Life Insurance Death Benefit with 2% LTC Rider
Super Preferred NonSmoker |
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| Issue Age | Annual Premium Without LTC Rider |
Annual Premium With LTC Rider |
Max. Monthly Benefit (2%) |
% Difference | $ Difference | |
|---|---|---|---|---|---|---|
| 40 | Male | 2,548 | 2,717 | 10,000 | 7% | 169 |
| 45 | Male | 3,082 | 3,312 | 10,000 | 7% | 230 |
| 50 | Male | 3,977 | 4,274 | 10,000 | 7% | 297 |
| 55 | Male | 5,153 | 5,570 | 10,000 | 8% | 417 |
| 60 | Male | 6,676 | 7,225 | 10,000 | 8% | 549 |
| 65 | Male | 9,207 | 9,977 | 10,000 | 8% | 770 |
| 40 | Female | 2,069 | 2,204 | 10,000 | 7% | 135 |
| 45 | Female | 2,509 | 2,688 | 10,000 | 7% | 179 |
| 50 | Female | 3,353 | 3,587 | 10,000 | 7% | 234 |
| 55 | Female | 4,548 | 4,867 | 10,000 | 7% | 319 |
| 60 | Female | 5,746 | 6,163 | 10,000 | 7% | 417 |
| 65 | Female | 7,650 | 8,229 | 10,000 | 8% | 579 |
Preferred NonSmoker |
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| Issue Age | Annual Premium Without LTC Rider |
Annual Premium With LTC Rider |
Max. Monthly Benefit (2%) |
% Difference | $ Difference | |
| 40 | Male | 2,832 | 3,034 | 10,000 | 7% | 202 |
| 45 | Male | 3,452 | 3,727 | 10,000 | 8% | 275 |
| 50 | Male | 4,418 | 4,762 | 10,000 | 8% | 344 |
| 55 | Male | 5,698 | 6,169 | 10,000 | 8% | 471 |
| 60 | Male | 7,345 | 7,965 | 10,000 | 8% | 620 |
| 65 | Male | 10,042 | 10,919 | 10,000 | 9% | 877 |
| 40 | Female | 2,306 | 2,461 | 10,000 | 7% | 155 |
| 45 | Female | 2,895 | 3,108 | 10,000 | 7% | 213 |
| 50 | Female | 3,722 | 3,993 | 10,000 | 7% | 271 |
| 55 | Female | 4,886 | 5,246 | 10,000 | 7% | 360 |
| 60 | Female | 6,185 | 6,651 | 10,000 | 8% | 466 |
| 65 | Female | 8,182 | 8,830 | 10,000 | 8% | 648 |
Standard Plus NonSmoker |
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| Issue Age | Annual Premium Without LTC Rider |
Annual Premium With LTC Rider |
Max. Monthly Benefit (2%) |
% Difference | $ Difference | |
| 40 | Male | 3,234 | 3,474 | 10,000 | 7% | 240 |
| 45 | Male | 4,087 | 4,419 | 10,000 | 8% | 332 |
| 50 | Male | 5,241 | 5,655 | 10,000 | 8% | 414 |
| 55 | Male | 6,849 | 7,431 | 10,000 | 8% | 582 |
| 60 | Male | 8,730 | 9,480 | 10,000 | 9% | 750 |
| 65 | Male | 11,808 | 12,853 | 10,000 | 9% | 1,045 |
| 40 | Female | 2,712 | 2,899 | 10,000 | 7% | 187 |
| 45 | Female | 3,432 | 3,692 | 10,000 | 8% | 260 |
| 50 | Female | 4,320 | 4,649 | 10,000 | 8% | 329 |
| 55 | Female | 5,571 | 6,011 | 10,000 | 8% | 440 |
| 60 | Female | 7,226 | 7,778 | 10,000 | 8% | 552 |
| 65 | Female | 9,834 | 10,591 | 10,000 | 8% | 757 |
For those of you who were not able to attend the May 5th LTC Webinar hosted by the Advanced Markets team, here is a link to access the recorded presentation, a printable copy of the powerpoint and other important materials on the LTC rider.
As always, we are here to assist you. We would love to hear your feedback on this series. Let us know what you think so far!
Contact Kirk to get started!
If you missed parts 1 & 2 you can view them here:
