Part of our guide: Long-Term Care Insurance: Costs, Options and Planning →
Two objections kill many long-term care sales: “it’s too expensive” and “I may never use it.” A permanent life policy with a long-term care rider answers both.
Key takeaways
- An LTC rider lets the insured accelerate part of the death benefit each month to pay for qualified long-term care.
- If care is never needed, the full death benefit passes to the family.
- In one illustration, adding an LTC rider to a $300,000 universal life policy cost about $15 more a month and provided up to $6,000 a month for care.
For about $15 a month more in one illustration, a $300,000 policy could pay up to $6,000 a month for long-term care — or the full death benefit if care is never needed.
How an LTC rider works
The rider allows the death benefit to be paid out early, typically a set percentage each month, when the insured qualifies for long-term care (usually unable to perform two of six activities of daily living, or cognitively impaired). Whatever isn’t used for care remains as a death benefit for the family.
Example
- Male, age 45, in good health
- $300,000 universal life policy for family income replacement: about $182 a month
- LTC rider: about $15 a month more
- Benefit: accelerate 2% of the death benefit per month ($6,000) for qualified care
Figures are from an earlier illustration and will differ by carrier, age, and health today.
Why clients like it
One policy protects the family and provides care funding. There’s no “use it or lose it” concern, as long as the policy stays in force. For clients with larger assets to reposition, see when asset-based LTC is a fit.
What to compare
Riders vary: some are true LTC riders under tax code section 7702B, others are chronic illness riders with different triggers and pricing. Compare the monthly benefit percentage, triggers, and whether benefits reduce cash value and death benefit. Our team can help you evaluate options.
Frequently asked questions
What is a long-term care rider on a life insurance policy?
A rider that lets the insured use part of the death benefit while living to pay for qualified long-term care.
What happens to the death benefit if LTC benefits are used?
It’s reduced by the amount accelerated. Whatever remains is paid to beneficiaries at death.
Is an LTC rider the same as a chronic illness rider?
Not always. LTC riders under IRC 7702B and chronic illness riders can differ in triggers, pricing, and benefits.
Reviewed by Tim Fuller on 2026-09-25
Tim Fuller
President, SRS Inc.
Tim leads SRS Inc., a full-service IMO (Independent Marketing Organization) and BGA (Brokerage General Agency), connecting independent financial professionals with life, annuity, disability income, and long-term care solutions from 60+ carrier partners.
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