Alternatives to Long-Term Care Insurance
Long-Term Care Insurance Companies
Many people will require some form of long-term care (LTC) in their later years, whether it be because of disability, illness, or the natural effects of the aging process. This care can come in many forms, including in-home care, nursing homes, assisted living, and more. One of the best ways to ensure that you are prepared for the costs associated with long-term care is to purchase an LTC insurance policy. There are several different companies who offer this type of policy, and choosing which company and which policy is right for you is an important step in planning for your potential long-term care needs.
Below is a list of the major companies in the long-term care insurance market today. This list is not comprehensive, and does not include insurance brokers and other companies that sell LTC policies but do not underwrite such policies themselves. Because we hope for this list to be useful to as wide an audience as possible, companies who only offer insurance in a relatively small number of states have also been excluded. Please note that just because a company does not appear on this list does not mean that they are not worth considering. Shopping around and looking at all of the options available is a critical part of buying long-term care insurance.
Companies Offering Traditional Long-Term Care Policies
These companies offer the traditional form of long-term care insurance, which is generally more affordable than hybrid life/long-term care insurance policies. To learn more about traditional long-term care insurance, see our other articles on the subject.
- Bankers Life & Casualty: dating all the way back to 1879, Bankers Life offers long-term care insurance and a variety of other products for retirement and beyond.
- Genworth Financial: one of the companies that pioneered long-term care insurance more than 40 years ago, Genworth remains a leader in the industry, serving more than 1.3 million Americans.
- MassMutual: a leading national insurance carrier offering a range of insurance, retirement, and investment products. MassMutual enjoys excellent reviews from A.M. Best, Fitch, Standard & Poor’s, and Moody’s Investors Service. Reviews.com rated them the best company for those looking for long-term care coverage for extended periods.
- Mutual of Omaha: a full-service, multi-line provider of insurance products and financial services, Mutual of Omaha is also one of the top long-term care insurance providers in the country. They offer highly flexible policies, and Reviews.com rated them the best company for robust LTC coverage.
- New York Life: America’s largest mutual life insurance company, New York Life has the highest possible ratings for financial strength from A.M. Best, Fitch, Standard & Poor’s, and Moody’s Investors Service. They also have the distinction of offering the only long-term care insurance plan currently endorsed by AARP.
- Northwestern Mutual Life: founded in 1857, Northwestern Mutual is now one of the largest long-term care insurance providers in the United States, with more than 130,000 policies currently in effect. The company is committed to steady, lasting value and offers a wide range of plans and benefits.
- State Farm: the largest property and casualty insurer in the United States, State Farm has been in the insurance industry for nearly 100 years. Their solid reputation and financial strength have made them the go-to choice for many, and the company currently has more than 83 million active policies and accounts across the country.
- Transamerica: founded in the early 1900s, Transamerica is a leader in the long-term care insurance industry and currently has more than 300,000 long-term care policies in force. Reviews.com rated Transamerica their top choice for affordable LTC insurance. Transamerica also received an A+ ranking from A.M. Best.
Companies Offering Hybrid and Asset-Based LTC Policies:
Hybrid and asset-based policies are life insurance policies or annuities that come with long-term care benefits. While generally more expensive than traditional insurance for long-term care, these policies ensure that your money does not go to waste by turning any funds not used on LTC into a death benefit for your heirs.
- Forethought Life Insurance: offers a fixed annuity with long-term care benefits to help protect your retirement savings. Since 1985, Forethought has served more than 2 million policyholders.
- Guardian Life Insurance:a mutual insurer founded in 1860, Guardian offers numerous insurance plans and financial services, including a life insurance/long-term care hybrid. They protect more than 6 million people and their families.
- Lincoln National Life Insurance:offers a universal life insurance policy with an optional long-term care benefit rider backed by their 100+ years’ experience in the insurance industry.
- Minnesota Life: part of Securian Financial Group, which has been in business for more than 130 years and was given an A+ rating by A.M. Best. Offers a hybrid life insurance and long-term care policy.
- Nationwide: offers hybrid long-term care insurance policies backed by their excellent reputation, financial strength, and more than 85 years’ experience in the insurance industry. On top of that, Nationwide has received great scores from A.M. Best, Standard & Poor’s, and Moody’s Investors Service.
- Pacific Life Insurance: backed by more than 150 years’ experience in the insurance industry, Pacific Life offers whole life insurance policies with long-term care benefits.
- State Life Insurance: founded in 1894, State Life is now one of the leaders in hybrid life insurance/long term care insurance policies. They are part of OneAmerica, a company rated A+ by A.M. Best.
The long-term care insurance industry has faced numerous issues in the past decade, and this has led many notable companies, including CNA Financial, John Hancock, MedAmerica, and MetLife to withdraw from the market. The long-term care insurance policies that these companies had already sold are still being honored, but they are no longer issuing new ones.
While most people purchase long-term care insurance as an individual plan through an insurance agent or broker, you may also be able to buy a plan through an employer or a professional or service organization. For example, persons working in (or retired from) public service in California are eligible for the state retirement plan known as CalPERS, which offers long-term care coverage as an optional, employee-paid benefit. More detailed information on these types of plans can be found in our article “Where to Purchase Long-Term Care Insurance”.
Vetting Long-Term Care Insurance Companies
As mentioned above, doing research and comparing policies is a crucial step in purchasing long-term care coverage. In a 2016 price comparison, the American Association for Long-Term Care Insurance found that rates could vary as much as 94% between different insurers. This is due in part to different companies structuring things in different ways – for example, the company selling the best rate for someone buying LTC insurance at age 55 may not have good rates for someone buying at 65, and so on.
In addition to comparing costs and features of the plans you’re interested in, you should also take some time to examine the insurance companies themselves, checking their history in the LTC insurance market on websites such as Moody’s Investors Service, A.M. Best, and Standard and Poor’s. Things to research include the financial strength and stability of the company (an important factor in assessing the company’s ability to pay out claims later on), how long they have been in the LTC insurance business, and how often they have increased their premiums in the past. We have articles available on all of the major LTC insurance companies to help you with this task, but it is also good to go out and do some digging of your own.
Preparing for the likely event that you will need long-term care in the future is an important component of any good retirement plan. Long-term care insurance is a big purchase, and it really does pay to do your research and make sure that you know everything you need to about your policy and the company that offers it before you make your purchase. Take a look at our other articles for tips and additional information about finding the right plan, talking to your agent, and more.
More Useful Links:
Bankers Life & Casualty Long Term Care