The Problem No One Talks About at Retirement Parties

You’ve done most things right. You’ve saved, invested, maybe paid off the house. Retirement is right around the corner — and for a moment, it feels like the hard part is behind you.

But there’s a financial risk that most retirement conversations gloss over: the cost of long-term care. Not a hospital stay. Not a short recovery. We’re talking about the kind of extended care — home health aides, assisted living, memory care, skilled nursing facilities — that can stretch on for months or years.

Medicare won’t cover it beyond a short skilled nursing stay. Medicaid only steps in after you’ve spent down nearly all of your assets. And traditional long-term care insurance? Premiums have skyrocketed, coverage has become harder to qualify for, and the “use it or lose it” structure leaves many policyholders paying for decades only to never collect a dollar if they stay healthy.

That’s the gap. And it’s exactly what hybrid long-term care insurance was designed to fill.

So What Exactly Is a Hybrid Long-Term Care Policy?

A hybrid long-term care policy combines two financial tools into a single, permanent policy. Depending on the product, it pairs either a whole life insurance policy or an annuity with a long-term care benefit rider.

Here’s the core idea: your premium goes into a policy that builds real value. If you ever need long-term care, the policy pays out — often at multiples of what you put in. If you never need care, your beneficiaries receive a death benefit. And if your needs change and you want your money back? Many policies offer a full return-of-premium option.

In short: the money doesn’t disappear. That’s the fundamental difference from traditional LTC insurance — and the reason hybrid policies have become one of the fastest-growing segments in the insurance market.

OneAmerica Asset Care: The Gold Standard in Hybrid LTC

When it comes to hybrid long-term care solutions, OneAmerica’s Asset Care is one of the most respected products on the market — and for good reason. It’s built on a foundation of whole life insurance, giving it a permanence and stability that annuity-based hybrids don’t always offer.

How Asset Care Works

At its core, Asset Care is a whole life insurance policy with an accelerated long-term care rider. You fund it — either with a single lump-sum premium or through a limited-pay schedule (typically 10 payments) — and the policy immediately creates a benefit pool for long-term care that is substantially larger than what you put in.

For example: a 60-year-old woman who repositions $100,000 into a single-premium Asset Care policy might generate a long-term care benefit pool of $300,000 or more, depending on the selected benefit period and coverage options. That’s a powerful leveraging of assets she likely had sitting in a low-yield CD or money market account.

What Makes Asset Care Stand Out

• Shared benefit riders — Couples can share a pool of benefits, meaning if one spouse exhausts their benefit, they can draw from the other’s pool
• Unlimited benefit period option — Unlike many policies capped at 3–5 years, Asset Care can provide unlimited LTC benefits for as long as you need care
• Both indemnity and reimbursement options — Choose how you want to receive your benefits based on your care situation
• Non-forfeiture benefit — If you stop paying premiums, you don’t simply lose the policy; reduced paid-up coverage remains in place
• Guaranteed premiums — Unlike traditional LTC insurance, your premium cannot be raised once the policy is issued
• Tax advantages — Benefits paid out are generally income tax-free; funding with a 1035 exchange from an existing annuity or life policy can be done tax-efficiently

OneAmerica Annuity Care: An Annuity That Does Double Duty

For individuals who prefer the structure of an annuity over whole life insurance, OneAmerica offers Annuity Care — a fixed annuity with a long-term care benefit rider attached.

Annuity Care works similarly in concept: you deposit a lump sum, the annuity grows on a tax-deferred basis, and if long-term care is needed, the policy provides an accelerated and extended benefit. If care is never needed, the annuity value passes to your beneficiaries or continues to accumulate.

Annuity Care can be a particularly effective solution for individuals who already hold non-qualified annuities with embedded gains, as a 1035 exchange can transfer those funds directly into Annuity Care — avoiding an immediate tax hit while gaining LTC protection.

Hybrid vs. Traditional LTC vs. Self-Insuring: A Straight Comparison

Who Is a Hybrid LTC Policy Right For?

Hybrid long-term care policies aren’t a perfect fit for everyone — but they are an excellent fit for a specific type of person. You might be an ideal candidate if:

• You are between ages 50 and 70 and still in reasonably good health
• You have $50,000 or more in a CD, savings account, or money market that isn’t earmarked for a specific near-term need
• You are concerned about long-term care costs but dislike the idea of paying premiums for a benefit you may never use
• You want to protect your retirement portfolio and home equity from being consumed by care costs
• You have a spouse or partner and want to ensure both of you are covered without two separate policies
• You hold an existing annuity or life insurance policy with a low cost basis and want to reposition those funds tax-efficiently

Common Questions About Hybrid LTC Policies

This article is for general educational purposes only and does not constitute tax, legal, or financial advice. Policy features, benefit amounts, and premiums vary based on age, health, state of residence, and selected options. Product availability may vary by state. OneAmerica Asset Care and Annuity Care are products of OneAmerica Financial Partners, Inc. Canopy Life Solutions is an independent insurance agency and is not affiliated with OneAmerica. Consult a licensed insurance professional and qualified tax advisor before making any decisions related to long-term care planning.