Hybrid LTC Annuity
Annuity-LTC hybrid product vs traditional standalone LTC + separate annuity vs self-insure. Compares dollar outcomes at horizon under no-claim, partial-claim, and full-claim scenarios.
Coverage
Ending value at horizon — no claim
Expected LTC exposure
Probability-weighted LTC cost at 45.0% chance of a 3-year claim at today's benefit level: $147,825.
Hybrid wins on the no-claim path and on the partial-claim path. Traditional wins when the household claims a long stretch (5+ years) because the standalone LTC has unlimited reinforcement. Self-insure only wins if the household never claims and the taxable return outpaces the hybrid's deferral.
Caveats: this is a planning frame, not carrier-specific pricing. Actual hybrid contracts vary in LTC trigger requirements (typically 2-of-6 ADLs), benefit acceleration features, ROP provisions, and tax treatment of LTC payments (§7702B accelerated benefits are tax-free).