Below are some frequently asked questions about Long-Term Care with Life Insurance.
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What is long-term care (LTC)?
Long-term care is the personal care and/or supervision (custodial, supervisory, or skilled care) needed by persons of all ages for an extended period.
Often this is because of conditions associated with the effects of aging, but LTC may be needed at any time due to an accident or illness. At some point in our lives, it is estimated that more than 60 percent of us will need assistance with things like getting dressed, driving to appointments, or making meals.
Is LTC covered by health or disability insurance?
It is a common misconception that LTC is covered by health or disability insurance. LTC services are typically not covered by Medicare, Medicaid, private health or disability insurance.
How does this program cover LTC costs?
This program is Trustmark Life + Care. It provides dual protection for the cost of LTC and financial support for your beneficiaries after you are gone.
When you elect a life insurance benefit amount, you will also get LTC coverage. The LTC coverage amount is a percentage of the Life Insurance benefit amount and is paid out in monthly increments.
Should I consider this if I already have LTC insurance?
If you already have LTC insurance, great! You may want to use this enrollment as an opportunity to review your coverage. It is often recommended to keep your original coverage because of the value it provides. However, if you would like to review your existing plan in more detail, you can meet with one of the LTC insurance specialists supporting this enrollment to review your coverage and options.
Can you explain in more detail how I might use the policy?
There are generally two ways you might use the policy:
If you don't need LTC in your lifetime, there is still a death benefit available to your beneficiaries. As an example, if you buy $100,000 of life insurance and don't use any LTC expenses, your beneficiaries would still be able to receive up to $100,000 in death benefits*.
Professional caregiving allows you to collect 4% of your face amount per month while family caregiving allows you to collect 2% of your face amount per month. You can collect up to twice your full face amount in benefits and can only collect one benefit at a time.
*Death benefits reduce to one-third at age 70 or on the 10th policy year, whichever is later.
How much does it cost?
The premium is based on how much death benefit you select, the age that you are at the time of application and your smoking status.
The best way to see your pricing is to click "Check Your Rate" and choose the blue "Continue" button to begin the enrollment process on the Trustmark website. You are under no obligation to purchase once you start the enrollment process and can exit anytime.
Can I increase my Trustmark Life + Care Insurance policy at a later date?
Yes, you can request to increase your existing Universal Life Insurance policy at a later date (after your 30-Day Free Look Period) with medical underwriting. If approved, the increase in coverage will be based on your current (attained) age.
Can I obtain coverage without providing evidence of good health?
Yes, if you select a death benefit within the program’s Guaranteed Issue amount and are between the ages of 18 and 70, there are no medical questions and acceptance is guaranteed. Guaranteed issuance is unique to special enrollment periods and does not re-occur every year.
If I apply for coverage beyond the available Guaranteed Issue amount for my age, what are the medical questions?
There are two sets of potential questions you will be asked if you apply for coverage beyond your available Guaranteed Issue amount:
Within a certain benefit range (called the Modified Guaranteed Issue) you need to answer a shortened health questionnaire consisting of two questions:
If either of these questions is answered “yes” or you select a death benefit amount above the Modified Guaranteed Issue range, additional health questions will be asked which includes a full health questionnaire, height/weight evaluation, Medical Information Bureau (MIB) screen, and a prescription drug screen. Additional medical questions may be asked based on findings.
This is called simplified issue - here are some examples of the types of questions asked at this stage:
Has any person to be insured:
Questions may vary depending on your state and benefit amount selected. The best way to see the questions specific to your coverage is to begin the enrollment process.
If I apply for more than the Guaranteed Issue amount of benefit but am denied, do I still receive the full amount up to my Guaranteed Issue limit?
Yes. If you do not qualify for an amount beyond the GI limit you will still be able to receive a policy up to the full amount of the Guaranteed Issue.
How do you qualify to receive LTC Benefits?
To receive LTC benefits, you must be receiving assistance with two (2) or more activities of daily living (transferring, continence, bathing, dressing, eating, toileting) or you have cognitive impairment expected to last more than 90 days. You also need to be receiving care from a licensed professional in a LTC facility, nursing facility or receiving home health care. Benefits are payable after you meet your 90- day elimination period, meaning, benefit payments will start 90 days (about 3 months) after your LTC needs begin.
A qualified health professional will need to certify that you meet the activity of daily living or cognitive impairment requirement.
What is qualifying care for professional caregiving and family caregiving benefits?
Professional caregiving is provided by a licensed, accredited or certified healthcare institution, other than a hospital, either in their facility, such as assisted living, or in your home. Family caregiving is hands-on care provided by your unpaid family member or friend in your home or their home.
Are there any limitations on where care is received?
If you qualify for LTC benefits, where you receive care is up to you (at home, assisted living, adult day care, nursing home). However, the policy will only pay LTC benefits for care received in the United States or Canada.
Death benefits are paid anywhere in the world.
What happens if I stop paying my premium?
Coverage will remain in force as long as there is sufficient cash value to cover the monthly expense, rider and cost of insurance charges. If insufficient, the coverage will lapse.
What happens if cancel my plan at a later date?
If you cancel the policy after the 30-Day Free Look Period, you will receive any Cash Value minus any applicable policy surrender fees.
How long does this policy last?
Coverage is designed to mature at age 121. If you are living and the coverage is in force on that date, the cash value will be payable, and the coverage will terminate. The illustration provided when you receive your coverage certificate will demonstrate the projected coverage period at the selected planned premium rate under both the current and guaranteed scenarios.
You will also receive an annual statement on the anniversary date of your policy to review your coverage period.
What if I leave my employer or retire?
This policy is completely portable – meaning you take the coverage with you if you change jobs or retire from your current employer. You should contact Trustmark to arrange for direct billing, and you can continue coverage without any change in premium or benefit amounts.
Can policyholders take a loan from the cash value? If yes, what are the terms?
Yes, the interest rate is 8% on policy loans.
Are my premiums guaranteed or will the costs increase with age?
Your premium will be based on your age at the time of issue and will not increase as you age. You will receive an annual statement on the anniversary date of your policy that will explain the details of your coverage and your policy activity.
How do I pay my premium?
The premium will be deducted from your paycheck based on your pay schedule (monthly, bi-weekly…etc.).
Are premiums paid on a pre-tax or post-tax basis?
The premiums are paid post-tax.
Why does the application require my SSN, height, and weight?
The insurance company requires SSN to set up the policy as it is used for tax purposes and claims. Height and weight are used in underwriting if you are ineligible for Guarantee Issue underwriting and are required to answer health questions.
Are my LTC benefits taxable?
Benefits paid may or may not be taxable. Whether or not you or your beneficiary incur a tax liability when benefits are paid depends on how the IRS interprets applicable portions of the Tax Code. As with all tax matters, you should consult your personal tax advisor to assess the impact of this benefit. The insurance company has no responsibility for any tax consequences of any benefits paid under this policy. The rider for LTC insurance is not intended to be a federally qualified LTC insurance contract.
This a brief description of the benefits under forms GTL 121 C MET and applicable riders CTR 121, LTC.121 and STR.121. This is a life insurance benefit that also gives you the option to accelerate some of the death benefit in the event that you meet the criteria for a qualifying event. This is not a long-term care partnership policy or a Medicare supplement certificate. The accelerated death benefit for terminal illness is designed with the intent to qualify for favorable tax treatment under Section 101(g) of the Internal Revenue Code. The accelerated death benefit for long- term care is designed with the intent to qualify for favorable tax treatment under Section 7702B(b) of the Internal Revenue Code and is subject to long-term care insurance law. Unlike the benefits provided by traditional or stand-alone long-term care insurance, the benefits provided do not include coverage for the reimbursement of long-term care services. A maximum issue age applies to certain benefits; coverage issued at age 70 or later may differ from what is described here. Limitations on pre-existing conditions may apply. Benefits, definitions, exclusions and limitations and form numbers may vary by state. Please consult your certificate for complete information. For costs, coverage details and terms, see your agent or write the company. Underwriting conditions may vary, and determine eligibility for the offer of insurance. Trustmark® and Trustmark Life + Care® are registered trademarks of Trustmark Insurance Company. In California, review “A Consumer’s Guide to Long-term Care from the Department of Aging” at: http://www.aging.ca.gov/aboutcda/publications/Taking_Care_of_Tomorrow_English/. All other states, please refer to publication https://content.naic.org/sites/default/files/publication-ltc-lp-shoppers-guide-long-term.pdf