NAIC Urged to Standardize Education on Long-Term Care Riders in Life Insurance

Christopher Gandy, president of the National Association of Insurance and Financial Advisors (NAIFA), emphasized the need for improved education for advisors and consumers on long-term care (LTC) riders included in life insurance policies. Speaking at the National Association of Insurance Commissioners (NAIC) Senior Issues Task Force fall meeting, Gandy highlighted significant confusion around hybrid life insurance products that combine life insurance with LTC or extended care riders. Gandy, who has over two decades of experience in both traditional LTC policies and hybrid life products, proposed that NAIC develop a standardized educational tool that clearly explains the basics of LTC riders and hybrid policies. This could be a concise, one-page document distributed alongside LTC and hybrid life insurance policies to help clarify their features and benefits. He stressed that current consumer information is often scattered and sometimes comes from social media influencers, which does not replace the in-person advice that typical buyers rely on. Clear, straightforward educational materials would assist advisors in providing consistent, accurate information, thereby reducing confusion and enhancing consumer understanding. This initiative aims to support advisors in educating clients about LTC options more effectively, ensuring clients make informed decisions about retirement and long-term care funding. The proposal acknowledges that clients seek dignity and choice in their retirement plans, which is only achievable if they receive comprehensive and clear information. The conversation around LTC education reflects ongoing industry efforts to address market challenges related to LTC insurance product complexity. By standardizing education materials, NAIC and industry stakeholders can help improve transparency and trust in LTC insurance offerings, potentially increasing market participation and improving coverage rates for long-term care needs.