Some variable annuities offer long-term care (LTC) insurance as well as tax-deferred investing.
You can buy a stand-alone LTC insurance policy, of course. However, such policies are expensive and they’re “use-it-or-lose-it”: you’ll never collect any benefits if you never need care.
With a variable annuity, on the other hand, you can get an income stream by tapping the annuity. If the contract also has LTC features, you’ll have added protection.
LTC insurance features differ so proceed cautiously. In some cases, the two sides operate independently. You can receive both an income from the annuity and LTC benefits at the same time. Receiving one won’t dilute the other.
Alternatively, in some contracts any money needed for long-term care will reduce the income available from the annuity. There may be a waiting period for LTC benefits.
