What's Happening?
Nationwide has launched the Nationwide CareMatters Annuity, a new product aimed at helping retirees and pre-retirees manage the rising costs of long-term care (LTC). This annuity combines guaranteed growth
with LTC coverage, offering a solution for those who may not qualify for traditional or life-based hybrid LTC policies. The product was developed in response to feedback from distribution partners seeking more accessible options. It features simplified underwriting and flexible funding options, including 1035 exchanges from non-qualified annuities or life policies. The annuity offers policyholders the ability to make a single premium payment or exchange an existing non-qualified annuity to receive double or triple their contract value in available LTC benefits. It also provides a 3% fixed crediting rate for predictable accumulation and ensures that any remaining contract value is passed on to beneficiaries as a death benefit if the insured never needs care.
Why It's Important?
The introduction of the CareMatters Annuity is significant as it addresses a major concern for many Americans: the financial burden of long-term care. With nearly six in ten consumers worried about how they will pay for LTC, this product offers a more attainable solution. It allows clients to protect their retirement savings from the high costs of LTC without sacrificing liquidity or guarantees. The cash indemnity structure of the annuity provides clients with full discretion over how benefits are used, aligning with consumer preferences for simplicity and control. This flexibility is particularly valuable for those planning for in-home and informal care scenarios. By offering a tax-free withdrawal of the entire contract value for covered care expenses, the annuity also provides a tax-efficient way to manage LTC costs.
What's Next?
Nationwide's new annuity is expected to attract interest from financial professionals and clients looking to integrate long-term care planning into broader retirement income strategies. As the product gains traction, it may influence other insurance providers to develop similar solutions, potentially leading to increased competition and innovation in the LTC market. Advisors will likely explore how this annuity can be used to reposition idle assets and create leverage for care costs, further enhancing its appeal to clients seeking comprehensive retirement planning options.
