Brighthouse Smart Care Indexed Hybrid Universal Life Long Term Care Insurance
Brighthouse Financial is a new company in the long term care insurance arena. Heck, Brighthouse Financial is a new company in every arena.
Brighthouse is a 3 year old company.
In 2017 MetLife established Brighthouse Financial as a completely separate entity from MetLife to sell life insurance and annuities to individuals in the United States. MetLife will continue to sell insurance products to employer groups. With this spinoff, MetLife has no control over the Brighthouse operations. Brighthouse is a distinct public company and MetLife is only a shareholder, albeit with a 20% stake.
The Brighthouse SmartCare hybrid long term care insurance policy is the first new life insurance product launched by Brighthouse since becoming an independent company.
Brighthouse is a well capitalized company with $227 billion in assets, however in 2018 the Brighthouse new business operations only sold a total of $7 million of life insurance premium.
Thus, the launch of the SmartCare hybrid policy is an important component of the company's strategy to establish its competitive presence in the US life insurance market.
The development of SmartCare arrives at the convergence of two key retirement trends: the rising costs of health care and increased life expectancies.
Let's take a look at the new SmartCare policy and see how it fits into the fast growing hybrid long term care market.
Hybrid long term care policies can benefit you in 3 ways. Hybrid policies provide you with long term care benefits if needed, a death benefit if care is not needed, and a cash surrender value if you change your mind.
Unlike stand-alone traditional long term care insurance policies that are "use-it-or-lose-it", hybrid policies will benefit you whether you Live, Die or Quit.
Brighthouse SmartCare is a unique hybrid LTC policy in that it is built upon an Indexed Universal Life chassis.
Brighthouse SmartCare is the only hybrid long term care policy with an Extension of Benefits Rider that is an indexed universal life product.
Indexed Universal Life policies have non-guaranteed elements.
Indexed UL policies provide you with the opportunity to receive crediting interest from the insurance company that will be linked to the performance of an underlying stock market index, such as the S&P 500. Your policy is not directly invested in the market, however your policy cash value has the ability to receive positive interest credits through the annual performance of a market index. If the index performs well on an annual basis Brighthouse will credit your policy cash value with interest up to its pre-determined Cap Rate. If the market index is negative for the year, you would not receive any interest credit, however your cash value would not decline either.
Brighthouse may change the Cap Rate on an annual basis thereby controlling the interest credited to your policy.
Your long term care monthly benefits will have the potential to increase with market gains.
The indexed linked long term care option is 1 option of 3 options Brighthouse will provide you with when you design your policy, however it appears that this will be the option that Brighthouse - or the insurance salesmen - will want to "market" to you.