Thomas McInerney, CEO of Genworth Financial Inc (GNW), says the company is rolling out a new long-term care insurance product called Privileged Choice Flex 3. The product is intended to address the reality that people are living longer and long-term care costs are increasing. He says the new product will offer lower-cost options than traditional long-term care insurance policies.
“The new product we are launching will include more affordable product options, such as lower ultimate coverage amounts. For some, that coverage will be more than sufficient. For others that might mean that if someone was to become disabled, they might not have full coverage, so they might have to use some of their own assets,” McInerney says. “But at least there would be a reasonable amount of coverage with the view that the costs of that would be more affordable. We know that clearly there is a much larger market if we could keep the costs to $1,200 or $1,500.”
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McInerney says Genworth also is beginning to offer so-called hybrid policies that combine a long-term care rider with a life insurance or annuity policy. Those policies also tend to be more affordable than traditional policies and appeal to a certain segment of the market.
“That’s particularly attractive to people who have a concern that if they buy a regular long-term care policy, and they never use it, they pay premiums, and they get nothing back,” McInerney says. “With these hybrid or combination products, they have a life insurance cover, a death benefit or a cash value, and they can use it for long-term care to the extent that they need it.”
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