Title: PRUDENTIAL LONGTERM CARE INSURANCE E' L' Liz Barnes, LUTCF, CSA, CLTC
1PRUDENTIAL LONG-TERM CARE INSURANCEE. L. Liz
Barnes, LUTCF, CSA, CLTC
T H E P R U D E N T I A
L I N S U R A N C E
C O M P A N Y O F A M
E R I C A
IFS-A110553 Ed. 12/06
For the education of Producers/Brokers only. Not
for use with the public.
2LTC3SM, Prudentials third generation individual
long-term care insurance product, was designed to
bring customization of benefits to a new level.
Improvements have been made to the base plan
(available to all policyholders), additional
options have been added to the base plan
options and new plan enhancements (riders) are
available for an additional cost.
2
3BASE PLAN
6
4 Facility Daily Benefit 50 - 500
MaximumIssue Ages 18-79
SERVICES COVERED- Nursing Home- Assisted
Living/Residential Care - Adult Foster Home/Board
Care Facility - Bed Reservation- Respite
Care- Hospice Care
In CA minimum FDB is 100 in NY minimum
FDB is 100 in metropolitan area and 70 in
non-metro area in WI minimum FDB is 60.
7
5Respite Care (Base)
- WHAT IS IT?
- Recognizing that caregivers sometimes need a
break, Respite Care provides 21 days (no Lifetime
Maximum) annually to be used to purchase
substitute care, providing relief of informal
caregivers. This benefit is paid at the Facility
Daily Benefit rate regardless of the site of
care. - CONSIDERATIONS
- Not Subject to Elimination Period.
- Days do not count toward satisfying Elimination
Period. - Reduces Lifetime Maximum.
In MA, days count toward satisfying the
Elimination Period.
8
6Private Care Consultant (Base)
- WHAT IS IT?
- An annual pool equal to 20 X the Facility Daily
Benefit to be used to retain services of a
personal LTC advocate or expert (not associated
with Prudential) to help the client and the
clients family. A Private Care Consultant acts
as the clients advocate, can help to arrange for
the delivery of Long Term Care services, and can
help choose providers. - CONSIDERATIONS
- Not subject to Elimination Period.
- Does not reduce Lifetime Maximum.
- Can be used on a day when other benefits are
needed.
9
7Private Care Consultant (Base)
- WHATS COVERED?
- Among the services a Private Care Consultant
might provide are - FAMILY COUNSELING- Helps the whole family cope
with LTC issues -
- LONG DISTANCE CAREGIVING- Overseeing quality and
quantity of care when caregiver cant be there - PLAN OF CARE- Developing a Plan of Care based on
client/family/ personal needs/wishes
Not available to residents of TX
10
8Bed Reservation (Base)
- WHAT IS IT?
- Pays LTC facility up to 60 days at Facility Daily
Benefit per calendar year to reserve bed if
client is away for any reason.
- CONSIDERATIONS
- Bed Reservation and Home Care will not be paid on
same day. - Reduces Lifetime Maximum.
- Subject to Elimination Period.
11
9WHAT IS IT?-Claimants will have the option of
electing this benefit on a monthly basis in lieu
of reimbursement for Eligible Charges for Home
Care. - Benefit is 40 of the Home Care
Daily Benefit amount. - Submission of bills or
proof of charges not required. - Need to
complete monthly Claim Form.- Subject to
Elimination Period and reduces Lifetime Maximum
by the actual monthly benefit amount
paid.CONSIDERATIONSCannot be used with Cash
Benefit Rider or Flexible Cash Benefit
Rider.TIP Allows for informal
caregivers/expenses that would otherwise not be
reimbursable.
Cash Alternative Benefit (Base)
In CA, benefit is 50.
12
10Home Support Services (Base)
WHAT IS IT? Lifetime pool equal to 50 X Facility
Daily Benefit to pay for support needs that
permit client to remain at home.
- WHATS COVERED?
- Assistive Devices Durable Medical
Equipment
(not covered by Medicare) - Home Modifications Emergency Response
Systems - Caregiver Training
- Transportation Services (for medically necessary
health care subject to Plan of Care) - CONSIDERATIONS
- May be used during Elimination Period.
- Reduces Lifetime Maximum.
- Can be used on a day that other benefits are
needed.
13
11Alternate Plan of Care (Base)
- WHAT IS IT?
- Permits policy to cover services not specified in
policy. Allows for future LTC services not yet
known and the ability to provide non-standard
services to current clients with special needs. - CONSIDERATIONS
- Service
- must be part of Plan of Care
- meet Federal definition of qualified service
- be approved client, Licensed Health Care
Practitioner - and Prudential
14
12Benefit and Resource Information Service (Base)
- WHAT IS IT?
- Provided by Prudential without cost, Benefit and
Resource Information services give guidance and
assistance to clients and their families in
understanding coverage, applying for benefits,
submitting claims, and locating community
resources. - CONSIDERATIONS
- Does not reduce Lifetime Maximum.
- Not subject to Elimination Period.
15
13Restoration of Benefits (Base)
- ELIGIBILITY
- If a previously eligible client is assessed and
found to no longer have a Chronic Illness or
Disability, and that status is maintained for 6
consecutive months, Restoration of Benefits can
restore the full Lifetime Maximum. - CONSIDERATION
- A client can be 1 ADL deficient and still restore
his benefits. - Benefits can only be restored once in a lifetime.
16
14Contingent Non-Forfeiture (BASE)
- WHAT IS IT?
- Provides a reduced Lifetime Maximum, or option of
selecting policy with lesser benefits, if policy
lapses due to Substantial Premium Increases.
Definition of Substantial Premium Increase
determined by state law and varies by clients
age at purchase. - EXAMPLE If policy bought at age 40, substantial
increase is 150 over the life of the policy. For
a 75 year old purchaser, the figure is 30.
17
15International Coverage (Base)
- WHAT IS IT?
- Pays for out of country Nursing Home or Home
Health Care, Homemaker Services or Personal Care - Paid at 75 (in NY and CA, 100) of the Facility
Daily Benefit and Home Care Daily Benefit - HOW IT WORKS
- Eligible Charges must be incurred outside US.
- Subject to a Lifetime Benefit of 365 days.
- Subject to Elimination Period and reduces
Lifetime Maximum. - Must be certified by a U.S. Licensed Health Care
Practitioner. - CONSIDERATIONS
- Cannot be used with Cash Alternative or Flexible
Cash Benefit Rider. - This benefit does not cover the following when
provided or charges are incurred outside the
U.S. Bed Reservation, Hospice Care, Respite
Care, Home Support Services, Alternate Plan of
Care or Private Care Consultant.
18
16Standard Waiver of Premiums (Base)
WHAT IS IT? After the Elimination Period is
satisfied, premiums will be waived on the day
following the date the Chronic Illness or
Disability is certified. Premiums will continue
to be waived as long as the insured is eligible
for benefits. CONSIDERATIONS Premiums will not
be waived if the insured is only receiving
Hospice Care, Respite Care, Home Support Services
or Information Services, all of which are not
subject to the Elimination Period. EXAMPLE
Elimination Period ends on 3/10. Premium is
waived as of 3/11.
19
17BASE PLAN OPTIONS
20
18Home Care Daily BenefitPERCENT OF FACILITY CARE
DAILY BENEFIT 50 75 100 150SERVICES
COVERED -Adult Day Care -Homemaker
Services -Personal Care -Home Health Care
Not available with Cash Benefit Rider or
Flexible Cash Rider .The 150 Home Care Daily
Benefit Option can only be selected with a
Facility Daily Benefit of 350 or less. In RI,
Home Care Daily Benefit cannot be less than 100.
21
19Daily Reimbursement for Eligible Charges up to
the Facility Daily BenefitMonthly Monthly
reimbursement pool for Eligible Charges up to
Home Care Daily Benefit x number of days in the
monthCash Benefit Rider (CBO) Monthly
indemnity payment equal to Home Care Daily
Benefit x number of days in the month
Submission of bills or proof of charges not
required Monthly submission of Claim Form
required. Flexible Cash Benefit Rider See next
slide for complete descriptionCONSIDERATIONS
Cash Benefit Rider not available with Unlimited
Lifetime Maximum, 150 Home Care benefit or Cash
Alternative feature in policy.
Home Care Payment Options
CBO is not available to residents of IN Plan
of Care is required.
22
20WHAT IS IT?Allows for 50 cash payment and 50
reimbursement of eligible charges every month.
Monthly Indemnity Payment is equal to 50 of the
Home Care Daily Benefit X Number of Days in the
Month. HOW IT WORKS- Monthly Submission of
Claim Form is required for 50 Cash Benefit.-
Submission of bills is required for 50
reimbursement.CONSIDERATIONS- Cannot be used
with CBO, Cash Alternative, Unlimited Lifetime
Maximum, 150 Home Care.- Cannot be used for
services received outside the US.
Flexible Cash Benefit Rider
Not available to residents of CA or IN.
23
21Lifetime Maximum
2 yrs., 3 yrs., 4 yrs., 5 yrs., 6 yrs., 10
yrs., and Unlimited Ages 18-79
Not available to residents of FL.
24
22Elimination/Benefit Waiting Period
- 30, 60, 90, 120, 180, 365 Calendar Days
- Ages 18-79
Variations CT no 120, 180, or 365FL no
365GA no 90, 120, 180, or 365KS no 180 or
365NY no 365PA no 180 or 365SD no 120,
180, or 365VT no 120, 180, or 365
25
23Calendar Day Elimination Period
- HOW IT WORKS
- The Elimination Period is counted in Calendar
Days. - Eligibility date is date Chronic Illness or
Disability is certified by a Licensed Health Care
Practitioner. - No need for services or incurred costs to satisfy
the Elimination Period. - Elimination Period does not have be satisfied to
use the following - Home Support Services
- Private Care Consultant Benefit
- Hospice Care
- Respite Care
- Elimination Period days
- are cumulative
- must be met only once per lifetime
26
24Inflation Protection Options
- NONE
- Guaranteed Purchase Option
- Automatic 5 Simple Inflation Benefit
- Automatic 5 Compound Inflation Benefit - 2X
Maximum - Automatic 5 Compound Inflation Benefit- No
Maximum
Variations CT no Automatic 5 Compound
Inflation Benefit - 2X Maximum IN no Automatic
5 Simple Inflation Benefit or Automatic 5
Compound Inflation Benefit - 2X Maximum WI no
Automatic 5 Simple Inflation Benefit
27
25Guaranteed Purchase Option (GPO)
- WHAT IS IT?
- Increases will occur automatically every 3 years
unless the offer is refused in writing (negative
election). - Benefits will increase by 5 of the current
policy benefit amount, compounded annually over
the 3 year period only catch-up no longer
offered. - No evidence of insurability is required.
- Increased coverage is rated at insureds attained
age. - Increases will be made even if Insured is benefit
eligible or on claim. - Offers continue as long as policy in-force even
if premium waived.
- CONSIDERATIONS
- Cannot be purchased with 10 Pay or Paid Up At Age
65, Premium Reduction at Age 65, Joint or
Survivor Waiver of Premiums, or Shared Care.
28
26-Benefits increase annually by 5 of the Original
Policy Benefits as long as the Policy is in
force.-The increase amount is the same each
year and your benefits double in 20 years.
Automatic Simple Inflation Option
29
27Automatic Compound Inflation Options
- AUTOMATIC 5 COMPOUND-2X MAXIMUM Benefits
compound at 5 annually until Facility Daily
Benefit is twice original elected amount
(approximately 14.5 years). - AUTOMATIC 5 COMPOUND-NO MAXIMUM Benefits
compound at 5 annually as long as policy is
in-force - CONSIDERATION
- Automatic Compound No Maximum Option cannot be
changed to Automatic Compound 2x Maximum after
Facility Daily Benefit reaches 2x original
Facility Daily Benefit
30
28Discounts
- Spouse/Partner Discount
- 15 discount for one Spouse/Partner, when the
other Spouse/Partner is not covered by a
Prudential Individual Long Term Care Policy. - 30 discount for each Spouse/Partner when both
are covered by a Prudential Individual Long Term
Care Policy. - Multi-Life (Employer Sponsored Program) Discount
- ESP 10 discount for Employees with Modified
Underwriting. - 10 discount for Spouse/Partner with full
Underwriting. - 5 discount for family members with full
underwriting. - Offset by commission contribution.
- Affiliation Discount
- 5 for members and others in case offset by
commission contribution
Varies in NJ, not available in all states. In
NY, Spouse discounts are 10 and 25.
31
29Plan Enhancement (Riders)
32
30SHORTENED BENEFIT PERIOD (Rider)
- WHAT IS IT?
- If policy is in-force 3 years, client may lapse
policy for any reason and retain coverage equal
to 30X policys current Facility Daily Benefit or
total premiums paid less any benefits paid,
whichever is greater.
Varies by state
33
31Joint Waiver of Premiums (Rider)
- WHAT IS IT?
- If both insured and Spouse/Partner have a
Prudential individual LTC insurance policy and
one qualifies for Waiver of Premium, the others
premium will be waived as well. Premiums will
resume on the first day after the chronic illness
or disability ends. - If one Spouse/Partners policy lapses without
using benefits under this option, the option
shall be voided and the premium adjusted for the
remaining Spouse/Partner. This option must be
purchased at the time of, or within six months
of, the original issue date. - HOW IT WORKS
- Premiums resume following either the death or
ineligibility of the eligible Spouse/Partner - Premiums will be pro-rated to the date of the
ineligibility or death - CONSIDERATIONS
- Not available with GPO or Shared Care rider
34
32Survivor Waiver of Premiums Benefit (Rider)
- WHAT IS IT?
- This option is only available if both
Spouses/Partners have purchased a Prudential
individual LTC insurance policy. With this
benefit, if after 10 years of paying premiums
and, if no claims were made against either
policy, one party dies, the survivor's premium
will be permanently waived. - HOW IT WORKS
- Premiums permanently waived if one Spouse/Partner
dies and - Both policies and the rider have been paid for 10
years - No claims have been made by either Spouse/Partner
for the first 10 years. - If a Spouse/Partner dies or lapses prior to
activating benefits under this option, the option
shall be dropped for the remaining Spouse/Partner - CONSIDERATIONS
- Not available with 10 Year Paid Up Option, GPO
Rider or Shared Care Rider. Not available to
residents of WA.
35
33SHARED CARE BENEFIT (Rider)
- COVERED BENEFITS
- Shared Care Benefit
- If one Shared Care Partner exhausts benefits
under his own policy, he can access benefits
under the other Shared Care Partners policy.
May exhaust all the benefits. - Survivor Benefit
- If one Shared Care Partner dies before exhausting
his own Lifetime Maximum, the remaining Lifetime
Maximum is available to the surviving Shared Care
Partner when he exhausts his own limits. - Exhaustion of Benefits
- If one Shared Care Partners Lifetime Maximum is
exhausted by the other Shared Care Partner, he
can purchase a new policy at attained age with a
two year Lifetime Maximum on a Guaranteed Issue
basis if age 90 or younger.
36
34SHARED CARE BENEFIT (cont.)
- CONSIDERATIONS
- Both Shared Care Partners have the rider and
designate each other as the Shared Care Partner - Both Shared Care Partners have and maintain
identical Policy Benefits, including Optional
riders. - Both Shared Care Partners have the same Premium
Payment Option. - Cannot be combined with GPO, Unlimited Lifetime
Maximum, Return of Premium at Death, Joint and
Survivor Waiver of Premiums.
37
35Return of Premium Upon Death (Rider)
- WHAT IS IT?
- At death, premiums paid for policy and riders
will be returned to the estate. - Refund equals total amount of premiums paid
minus any benefits Prudential had paid or are
payable. - HOW DOES IT WORK?
- Benefit will be paid even if Insured was
receiving benefits and premium was waived. - Refund does not include waived premiums.
- CONSIDERATIONS
- Cannot be used with Shared Care rider. Not
available to residents of NY or PA.
38
36Premium Payment Options
- Lifetime Premiums are paid until waived or
policy ends or lapses. - PREMIUM REDUCTION AT AGE 65 Premiums reduced by
50 at age 65 - Available to ages 60 or younger
- Premiums are paid throughout a lifetime
- ALTERNATIVE PAYMENT OPTIONS
- 10 YEAR PAID UP Premiums paid for 10 years.
- - Available to ages 40 - 75
- PAID UP AT AGE 65 Premiums paid until age 65.
- - Available to ages 54 and under.
Variations NJ and TN if purchase alternative
payment option must also purchase Non-forfeiture
- Shortened Benefit Period Rider FL Lifetime
only PA Lifetime and Premium Reduction at 65 TX
Lifetime only
39
37Definition of Partner A person of the same or
opposite sex who meets all the criteria listed
below
- is over age 18
- have lived together at least 12 consecutive
months preceding the date of Application - have a serious and committed relationship
- is not legally married, nor a Partner to anyone
else and - is financially interdependent. Financially
interdependent means that the Partners must
share the cost of food and housing. While they do
not have to contribute equally or jointly for
each of these expenses, each must be responsible
for such costs. - Examples of situations that might involve
Partners would include households composed of
siblings, parent/ child, other familial
relationships, domestic partners, or any two
individuals of either or both sexes who have
established a stable, committed association with
the clear and expressed expectation of long term
cohabitation.
Definition varies by state.
This discount is not available in some states.
40
38Rating Classes
- Preferred .85
- Standard I 1.00
- Standard II 1.25
41
39Multi-Life
40Multi-Life
- Multi-life Opportunity
- The multi-life LTC market is one of the fastest
growing components of LTCi sales - Executive Carve Outs
- Employee Benefits
- Opens door for cross-selling approach
- Prudential offers LTCi products to
- Individuals (small employer groups)
- Associations
- Large corporations
41Impact of Caregiving on Employers
- The National Alliance for Caregiving and AARP
Survey1 found - 1 out of 4 U.S. households are involved in
caregiving - 2 out of 3 caregivers are employed fulltime
- 1 out of 3 caregivers lose up to 16 hours of work
per month due to caregiver responsibilities - 11Caregiving in the U.S. National Alliance for
Caregiving (NAC) and AARP. May, 2005.
42Impact on Employer Employee
- Result of care-giving
- Businesses lose up to 33 billion annually1
- Absenteeism
- Decline in productivity
- Interruptions (emergencies and calls)
- Decreased morale and motivation
- Unwillingness to travel inability to relocate
- Employees are physically, emotionally,
financially drained - 30 of employees with parent age 65 miss work2
- 31 quit work3
- 67 adjust work schedules4
- Impacts retirement educational saving
- 2/3The State of Aging and Health in America 2004.
1 National Alliance for Caregiving
43Financial Costs of Informal Caregiving
- 1 out of 2 caregivers provide more than 8 hours
of caregiving per week.1 - 17 provide more than 40 hours per week.1
- Estimated loss to informal caregiver
- 25,494 in social security benefits
- 67,202 in pension benefits
- 566,433 in wages
- Total lifetime loss 659,1392
- Source The State of Aging and Health in America
2004. http//www.caregiver.org/factsheets/selected
_caregiver_statistics.html
44Employer Sponsored Program (ESP) Highlights
- Employer group size requirement
- NEW 3-9 Life Market (All eligible employees must
be insured) Employer may Class Out the group - 10 to 500 lives (must work minimum of 30 hours
per week) - Minimum participation requirement
- Under 10 lives, 100 of the Class, otherwise
groups of 10-500, the greater of 10 Individuals
or 5 of the group, Spouses included for minimum
participation. - Discounts
- 10 discount to employees spouse/partner
- 5 discount to family members
- No maximum on discounts
- Preferred health rate class not available to
employees under ESP - Modified underwriting (employees ages 18 - 70)
- Customized plan design for every client
- Buy-ups available
- Parents, in-laws, aunts, uncles, siblings,
grandparents, grandparents in-law, and children
ages 18 and older.
45ESP Plan Design
- Options with modified underwriting
- 50 - 300 Facility daily, monthly, or cash
benefit - 50, 75 or 100 home care
- Benefit periods 2, 3, 4, 5, or 6 years
- Elimination period 60, 90, 120, 180, or 365 days
- All Inflation options available
- Accelerated premium options available
- 10 pay
- Paid-up at 65
- Buy-ups available
- Lifetime,higher daily,monthly or cash benefits,
etc.
46Optional Riders
- With modified underwriting
- Flexible cash benefit rider
- Cash benefit rider
- Return of premium upon death benefit
- Available as buy-up with full underwriting
- Shared care benefit
- 150 home care daily benefit
- Joint waiver of premiums benefit
- Survivor waiver of premiums benefit
- For the Prudential LTC3 product only. Contact
your Regional Sales Manager with questions on LTC
By DesignSM.
47ESP Modified Underwriting Questions
48- Do you use walker, oxygen, respirator, or kidney
dialysis? - Within past 12 months have you used adult day
care, needed home health care, or been medically
advised to enter or been confined to nursing
home, assisted living facility, or other LTC
facility? - Do you currently need assistance or supervision
by another person in performing any of the
following activities bathing, eating, toileting,
bowel or bladder control, moving in and out of
bed or chair, dressing, or taking your
medication? - Have you had, do you currently have, or have you
ever been diagnosed as having any of the
following medical conditions - Organic Brain Syndrome, Dementia, Senility,
Confusion, Memory Loss, or Alzheimers Disease? - Metastatic Cancer (cancer that has spread from
original site or location?) - Multiple Sclerosis (MS), Muscular Dystrophy,
Multiple Transient Ischemic Attacks (TIA),
Parkinsons Disease, Amyotrophic Lateral
Sclerosis, Stroke, or Cerebrovascular Accident
(CVA)?
49Exclusions
- 1.Illness, treatment or medical conditions
arising out of - a)War or an act of war
- b)Participation in a Felony, riot or
insurrection, or - c) Alcoholism and drug addiction
- 2. Treatment provided in a government facility
- 3. Charges for services or supplies normally
provided without - charge.
- 4.Charges for care or treatment provided outside
the United - States except as described in the
International Coverage benefit. - 5. Charges for expenses reimbursable under
Medicare or for expenses that would be
reimbursable under Medicare but for the
application of a deductible or coinsurance
amount. - 6. Benefits under your policy may be reduced if
Prudential also pays benefits for Eligible
Charges under any other Prudential Individual
Long Term Care Insurance Policy.
No exclusions apply to the Cash Benefit rider,
the cash portion of the Flexible Cash Benefit
rider or the Cash Alternative benefit. Vary by
state
Summary is for descriptive purposes only. All
provisions are subject to the language of the
actual policy, including the definitions, terms,
conditions and exclusions set forth in the policy.
42
50Initiating A Request for an ESP Case
51(No Transcript)
52Disclaimers
LTC3SM long term care insurance is underwritten
by The Prudential Insurance Company of America,
751 Broad Street, Newark, NJ 07102
(800-732-0416). The Prudential Insurance Company
of America is authorized to transact business in
all U.S. states and the District of Columbia. All
insurance policies/options may not be available
in your state. Coverage is issued under policy
number GRP 113096 however policy numbers may
vary by state. The Prudential Insurance Company
of America is a Prudential Financial company.
Prudential Financial is a service mark of The
Prudential Insurance Company of America, Newark,
NJ, USA and its affiliates.
43