Long term care insurance (LTCI) may be sold directly to individuals or through an employer group or other organization. With group policies, while you do not generally have a choice of companies, the advantage is that your organization likely searched for and selected a company and policy to offer you. However, you may have fewer choices in the amount of coverage and options in the policy. Group policies may have an added advantage of being “guaranteed issue”, meaning that there is no medical exam or interview required to be accepted into the plan (pre-existing conditions will always be considered though).
Group LTCI is offered as an employee benefit like disability insurance or health insurance. Employees may be offered a plan that is partially paid for by the employer, or it may be required that the employee pay the entire amount. In any case, if you are offered LTCI through the employer and you are healthy, it would be wise to compare the employer’s plan with one you can purchase individually through a broker or agent. Just make sure it is someone who is trained in LTCI, not just someone who is licensed to sell it. For a comparable price, the individually purchased LTCI plan may offer more options and riders than the group plan.
Aside from group LTCI, also available to corporations is a Multi-Life discount. Many companies will offer significant discounts on LTCI if 3 or 4 individuals sign up for the insurance together. This happens when a corporation wants to provide an award to its officers and key employees. Tax laws surrounding LTCI make it possible to discriminate as to who can receive this benefit (unlike disability insurance or health insurance), and Multi-life discounts can be significant. Also, corporations can take a tax deduction for the expense of the insurance premiums, while the users of the insurance get the benefits tax free!
If you are interested in adding group LTCI to your company’s menu of benefits, contact us. Brewster Hill Insurance principal David B. Rubin has been selling LTCI since 2004 and has attended training seminars, state classes, and “boot camps” on LTCI, and has obtained the CASL (Chartered Advisor on Senior Living) designation from the American College.
