Pacific Life Insurance Company has been offering insurance since 1868. They provide a wide range of products including life insurance, annuities, and hybrid long-term care life insurance. Pacific Life’s hybrid LTC-life insurance is called PremierCare Choice.
Pacific Life’s PremierCare Choice
PremierCare Choice is a whole life insurance policy with a qualified long-term care insurance rider. This hybrid combination offers you three great benefits:
- Long-term care coverage in the event you need long-term care services.
- A death benefit to your beneficiaries if you never need care
- A return of premium if you ever change your mind
Such guaranteed benefits will give you the assurance that your long-term care needs will be met and your funds will always be available if you ever change your mind.
How Does Pacific Life’s PremierCare Choice Work?
First, PremierCare Choice uses an Accelerated Benefits Rider to pay long-term care benefits from the life insurance policy.
After the life insurance benefit is exhausted, the policy then uses an Extended Benefits Rider to continue to pay long-term care benefits.
Between the Accelerated Benefits Rider and the Extended Benefits Rider, a Premier Care policy may have a benefit period up to 8 years!
That’s up to 8 years of long-term care coverage and protection!
(You choose the length of your benefit period at the time of application.)
How Is A PremierCare Policy Funded?
A Premier Care Choice policy can be funded using a single premium deposit or recurring premiums.
PremierCare Choice gives you the option to make recurring premium payments over 5, 10, 15, or 20 years.
Funding sources for Premier Care can come from a number of sources. Examples of funding sources include:
- A portion of your savings
- Cash value from an existing life insurance policy
PremierCare Choice provides you with a number of funding options to fit your needs.
How Can I Qualify For PremierCare Choice?
To be able to qualify for PremierCare Choice, you must be between the ages of 30-75.
The policy offers two rate classes: Non-smoker and Smoker.
Both risk classes offer a couples discount for applicants who are married, in a state sanctioned civil union, or are in a domestic partnership.
Both spouses do not have to apply in order to receive the couples discount.
PremierCare Choice offers a streamlined application and underwriting process.
This streamlined process consists of gathering information from you and conducting a personal history telephone interview.
An Attending Physician’s Statement is also required for applicants age 50 and over.
What LTC Services Does PremierCare Choice Cover?
PremierCare Choice covers a range of long-term care services including:
- Facility-Based Services
- Nursing Homes
- Assisted Living Facilities
- Hospice Care Facilities
- Home & Community-Based Services
- Adult Day Care Centers
- Home Health Care
- Alternative Care
- Home Modifications
PremierCare Choice provides you with the option to receive care in a number of places. The policy also covers the cost of durable medical equipment that may be needed during a long-term care event.
How Does Pacific Life’s PremierCare Choice Pay Claims?
PremierCare Choice is unique among other hybrids as it can pay claims in one of two ways: reimbursement or indemnity.
While most hybrid LTC policies pay claims either by reimbursement or by indemnity, PremierCare Choice lets you choose your benefit payment method.
If you choose to receive your benefits via reimbursement, you would have to submit bills or receipts to Pacific Life for your benefits to be disbursed.
However, if you select to receive benefits via indemnity checks, Pacific Life will mail you a check every month up to the maximum monthly benefit amount listed in your policy.
One thing to keep in mind however, is that selecting your benefits to be paid via indemnity checks will reduce your policy’s total LTC benefit pool.
Pacific Life will only pay about 80% of your total LTC benefit pool if you choose indemnity checks. In addition, you cannot change your benefit payment method once you started receiving benefits.
0-Day Elimination Period For Home-Based LTC Services
(Reimbursement Benefit Payment Option Only)
PremierCare Choice offers a 0-day elimination period for Home-Based Long-Term Care services. This offer is only available under the reimbursement benefit payment option.
Now, according to the U.S. Department of Health and Human Services, 65% of people who need long-term care services are receiving it at home.
Therefore, this is a great feature to have since most long-term care claims begin at home.
With most hybrid policies, there is a 90-day elimination period before you can receive benefit payments. You have to pay for long-term care services for the first 90 days.
However, if you go on claims with PremierCare Choice and you are receiving care at home, you don’t have to wait 90 days before receiving benefit payments.
This feature also results in huge cost savings for you. For example, let’s say the cost of care in your home state is $4,500 a month. A 0-day elimination period will result in $13,500 in cost savings!
Flexible Benefit Payments (Reimbursement or Cash Indemnity)
Hybrid LTC insurance policies typically pay benefits either as a reimbursement or as cash indemnity.
However, with PremierCare Choice, you have the flexibility and choice to receive your benefits either as reimbursements or as cash indemnity at the time of claim.
With the reimbursement option, you would submit receipts or bills of your qualified LTC expenses and the policy would reimburse you the cost.
This helps ensure that your will benefits will always be used for your care at all times.
On the other hand, with the cash indemnity option, Pacific Life will send you a check at the beginning of the month up to your monthly benefit limit stated in the policy.
This option gives you the flexibility to use your money however you choose. For example, if you wanted to pay a friend or relative to provide informal care, this option would allow you to do so.
However with PremierCare Choice, there is a reduction of benefits if you select the cash indemnity option. Policies will pay up to 80% of the total LTC benefit if you choose this option.
Nevertheless, your benefit payment option is selected at the time you go on claims and not at the time you apply for coverage.
Therefore, this gives you time to decide which option is right for you.
PremierCare Choice is the only product in the hybrid LTC insurance market that offers you this added flexibility!
100% Return of Premium
PremierCare Choice is one of the only hybrid products on the market that offers a 100% return of premium on all of their policies.
Whereas other hybrids may charge for this feature, PremierCare Choice policies offer this feature at no additional cost to you.
Policies issued have a built-in vesting schedule for the return of your premium. Therefore, as the years go by, you have access to a higher return of premium.
Typically with PremierCare Choice, you have access to a full return of premium after 15 years of owning the policy.
This is a great feature to have because it offers you the peace of mind that you can always get back your full premium deposit at some point and time -(assuming you have not made any policy distributions in the form of a loan or LTC benefit claim).
How Does PremierCare Choice Compare to Other Products?
Pacific Life’s PremierCare Choice definitely meets the standard in the hybrid LTC insurance market. If we were to compare PremierCare Choice to its competitors, it is best to make comparisons using the following 5 categories:
- Long-term Care Benefit Pool (LTC Benefit Amount)
- Benefit Periods
- Elimination Periods
- Inflation Protection Options
- Premium Payment Options
(For a detailed description of these 5 categories and how they affect a hybrid-LTC insurance policy, please read our post “5 Things to Review In Every Hybrid Long-term Care Policy.”)
Earlier in the post we stated that PremierCare Choice allows you to select a benefit period of up to 8 years and also offers flexible premium payment options.
Therefore, PremierCare Choice already shows it performs well in 2 of the 5 categories.
For our comparison, we will use the remaining three categories: LTC Benefit Pool, Elimination Periods, and Inflation Protection Options.
Now let’s see how PremierCare Choice compares to Lincoln Financial’s MoneyGuard III, another well-known and competitive product in the hybrid marketplace.
PremierCare Choice vs. MoneyGuard III
Case Study: Tom
Let’s consider a case study using “Tom.” Tom is a 55 year old married male in Pennsylvania looking to get a hybrid long-term care insurance policy for himself.
Tom has $100,000 in savings that he would like to use to secure a policy.
Based on what Tom is willing to deposit, let’s see what PremierCare Choice and MoneyGuard III can offer him.
Pacific Life PremierCare Choice
For a $100,000 deposit, Tom gets over $480,000 in initial LTC benefits!
That’s almost $5 in insurance for every $1 he placed in PremierCare Choice!
In addition, with a competitive 5% simple interest inflation protection option, Tom’s total LTC benefit at Age 80 is over $1,000,000!
His total benefits at age 80 compared to his premium deposit is over 10:1!
This policy also comes with a 0-day elimination period for home health care and as we from experience, most long-term care events begin at home.
Also, after 15 years of the policy being in-force, Tom has access to a full return of premium if he ever changes his mind!
Not to mention he the policy provides Tom with a $142,240 death benefit if he never needs long-term care services.
Altogether, PremierCare Choice bundles great benefits and quality LTC coverage all in one product!
Now let’s see what Lincoln Financial’s MoneyGuard III will get Tom.
Lincoln Financial’s MoneyGuard III
Now if Tom places his $100,000 into Lincoln’s MoneyGuard III, he will receive $432,000 in initial LTC benefits.
That’s about $50,000 less than what PremierCare Choice offered Tom.
In addition, with Lincoln’s 3% compound interest inflation protection option, Tom’s total LTC benefit pool will be $906,334 at age 80.
That’s $100,000 less than what Pacific Life’s PremierCare Choice can give to Tom at age 80.
In addition, MoneyGuard only offers a 70% return of premium if Tom changes his mind. Tom would lose $30,000 in assets if he decided to cancel.
The death benefit for Lincoln’s MoneyGuard and Pacific Life’s PremierCare Choice are practically the same.
However, the elimination period for MoneyGuard is stronger as it has no elimination period for all eligible claims.
So what can we conclude for Tom’s case?
Conclusion – Pacific Life’s PremierCare Choice Is Competitive
In Tom’s case, if he went with PremierCare Choice, we see he gets $50,000 more in initial long-term care benefits.
Also, at age 80, Tom would $100,000 more in LTC benefits compared to MoneyGuard.
PremierCare Choice is the clear winner for Tom as it gives him “the most bang for his buck.”
Is PremierCare Choice The Right Choice For Me?
PremierCare Choice is a great product that offers quality coverage along with strong key features.
However, to say if its the right option for you is not always easy. It all depends on your long-term care planning goals and needs.
Nevertheless, PremierCare Choice is definitely worth considering as an option among hybrid LTC products.
Therefore if you are considering PremiereCare Choice, we are more than happy to help you determine if it’s your best option based on your specific needs.
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If you are interested in Pacific Life’s PremierCare Choice or long-term care planning in general reach out to us now! We want to assist you today!
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