I'm about to get divorced. A few years ago I purchased a
long-term-care policy with a rider that lets me share the benefit
period with my husband. Is there any way to detach my coverage
from his without losing it altogether? If so, what will happen to
The rules vary by company, but some of the largest insurers make
it easy to drop the rider and continue your separate policies --
and your rates may even decrease.
Many long-term-care insurance companies let you buy
"shared-benefit" policies with a spouse or partner. These policies
let you share a pool of benefits rather than have two separate
benefit periods. For example, if you each buy four-year
shared-benefit policies, you have a pool of eight years of benefits
that you can use between the two of you. So if one of you needs
care for only two years, say, the other will still have six years
of benefits left.
Having shared benefits helps you hedge your bets that you'll
have enough coverage if one spouse needs care for much longer than
the other. The average long-term-care insurance claim is about
three years, but people who need care beyond that tend to need it
for much longer -- sometimes for a decade or more if they have
Adding a shared-benefit rider costs more than having two
policies with separate benefit periods, but it often helps people
feel more comfortable with buying a shorter benefit period,
especially now that most insurers either no longer sell lifetime
benefits or have made them extraordinarily expensive. Adding a
shared-benefits rider can cost an additional 5% to 22% at Genworth,
the largest long-term-care insurer, depending on the policyholders'
ages, the length of the benefit period and the level of inflation
protection. Generally, the older the policyholders and the more
generous the coverage, the higher the extra cost.
Genworth lets either person request removal of the shared
benefits at any time (you don't need to be officially divorced),
but both people must agree to remove the feature. Instead of having
a pool of eight years to use between the two of you, then, you'd
each end up with a regular four-year policy.
Both Genworth and John Hancock discontinue the extra charge when
you discontinue the shared benefit, which may cause your rates to
go down by about 10% to 15%. However, neither insurer removes any
spousal discount you received when you originally purchased the
policy, so you'll still benefit from that break.
For more information about long-term-care insurance, see
Navigate a Course for Long-Term Care