One of the most common things I hear from people in their mid-60s and older is this: “I’ve already ruled out long-term care insurance. My health isn’t perfect, and I don’t think I’d qualify anyway.”
If that sounds like you, I want to slow things down for a moment—because there are newer options available today that didn’t exist for many years, and one of them may surprise you.
In this Cardinal Lesson, I walk through a hybrid annuity long-term care policy that often has easier health qualifications than traditional long-term care insurance or life-insurance-based hybrids. That easier underwriting is the real reason we’re talking about this policy.
Why Use an Annuity for Long-Term Care?
Most hybrid long-term care policies are built on life insurance, which usually means strict underwriting. If you’ve had certain medical conditions, you may have already been declined—or discouraged from applying altogether.
This policy uses an annuity as the foundation, and that changes things. The health questions are typically more forgiving, which opens the door for many people who assumed long-term care planning was no longer an option for them.
Another important benefit is flexibility. Many people already own annuities they bought years ago that are just sitting there, growing tax-deferred but without a clear purpose. In some cases, those annuities can be repositioned through a 1035 exchange into this type of policy, potentially turning dormant money into meaningful long-term care benefits—without triggering a taxable event.
How the Benefits Work
This policy pays benefits as cash indemnity, not reimbursement. That means if you qualify for care, you may receive a monthly check. You don’t have to submit receipts to an insurance company or justify every dollar you spend.
That flexibility matters. It allows you or your family to use the money for home care, assisted living, or even to pay a family member for help—depending on your situation. And in many cases, those benefits are tax-free, which can make a big difference compared to pulling money from an IRA or selling taxable investments during a care event.
What If You Never Need Care?
Another concern people raise is, “What if I never need long-term care?” That’s a fair question—and honestly, it’s the best-case scenario.
If care is never needed, this policy still has value. Any remaining account value may pass to your beneficiaries as a death benefit. So the money doesn’t simply disappear if long-term care never becomes part of your story.
This Is About Planning, Not Pressure
I want to be very clear: this is not the only long-term care solution, and it won’t be the right fit for everyone. But it fills a gap that’s existed for a long time—especially for people who felt shut out of planning because of health concerns.
Long-term care is one of the most disruptive events a family can face, financially and emotionally. My goal in sharing this information is to help you understand that you may still have options—and that planning ahead, even imperfectly, is almost always better than facing a crisis unprepared.
If long-term care is something you’ve avoided thinking about, I encourage you to watch the full lesson, review the materials, and consider whether this type of policy could make sense as part of your overall plan.
