Life insurance seems like a straight-forward financial product. Insurance companies receive premiums and in exchange they pay out a death benefit to policyholders' beneficiaries. However, these plans can be much more complex than that.
"There are a lot of options – much more than people realize," says Cliff Wilson, chair of the board of directors for Life Happens, a nonprofit that educates the public on insurance matters.
Some policy perks are geared toward certain populations, such as the USAA Military Future Insurability Rider, which lets service members convert a military policy upon retirement. But other life insurance perks can be had by virtually anyone.
One of the best ideas from the article was the possibility of adding a LTC rider to your policy.
1. Pay for long-term care expenses. Long-term care insurance is expensive, and adding a rider to a life insurance policy can be an effective way to get this coverage. Specialty products that combine life and long-term care insurance are also available.
Whether the coverage comes as a rider or a specialty policy, using long-term care benefits typically reduces the amount of the death benefit. While there is an extra cost for adding long-term care coverage to a life insurance policy, it can be more cost-effective than buying two plans.
It can also be a good choice for people who want long-term care insurance, but aren't sure if they will need it. "They are going to get coverage, but they aren't spending money on a policy they aren't going to use," says Jimmy Lee, CEO of The Wealth Consulting Group in Las Vegas.