Do LTC Policies Have a Cash Value?

Shawn Plummer

CEO, The Annuity Expert

Traditional Long-Term Care Insurance Policies

Traditional long-term care (LTC) insurance policies generally do not have a cash value component. These policies are designed to cover long-term care services, such as nursing home care, assisted living, or in-home care. The premiums for these policies cover the risk of needing long-term care and do not accumulate as cash value.

Related Reading: Pre-existing conditions that deny long-term care insurance

Long-Term Care Annuities

Long-term care annuities are a different financial product. They combine the features of an annuity with long-term care coverage. In this arrangement, you make a lump sum or series of payments into the annuity. This investment can grow over time, and if you require long-term care, the annuity provides payments for these services. The cash value in these annuities can be the accumulation of the invested amount and its earnings.

Hybrid Long-Term Care Insurance Policies

Hybrid LTCI or linked-benefit policies combine life insurance with long-term care coverage. These policies do have a cash value component. If you don’t use the long-term care benefit, the policy can pay out as life insurance to your beneficiaries upon your death. The cash value in hybrid policies is the part of your premiums that is invested and can grow over time.


  • A traditional LTC policy with a premium of $2,500 per year offers no cash value but covers nursing home costs.
  • A long-term care annuity with an initial investment of $50,000 grows over time and can be used for care.
  • A hybrid policy with a $75,000 premium can grow in cash value and provide either long-term care or death benefits.


Understanding the differences in LTC policies is crucial for making an informed decision. Traditional LTC insurance does not offer cash value, while long-term care annuities and hybrid policies do. Each has its own set of benefits and considerations. Contact us today for a free quote.

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Shawn Plummer

CEO, The Annuity Expert

Shawn Plummer is a licensed financial professional, insurance agent, and annuity broker with over 14 years of first-hand experience with annuities and insurance. Since beginning his journey in 2009, he has been pivotal in selling and educating about annuities and insurance products. Still, he has also played an instrumental role in training financial advisors for a prestigious Fortune Global 500 insurance company, Allianz. His insights and expertise have made him a sought-after voice in the industry, leading to features in renowned publications such as Time Magazine, Bloomberg, Entrepreneur, Yahoo! Finance, MSN, SmartAsset, The Simple Dollar, U.S. News and World Report, Women’s Health Magazine, and many more. Shawn’s driving ambition? To simplify retirement planning, he ensures his clients understand their choices and secure the best insurance coverage at unbeatable rates.

The Annuity Expert is an independent online insurance agency servicing consumers across the United States. The goal is to help you take the guesswork out of retirement planning and find the best insurance coverage at the cheapest rates

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