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Northwestern Mutual Reps Discuss Long Term Care Insurance



On Wednesday, April 7th, the Actuarial Club was honored to host Northwestern Mutual for a presentation on "Meeting Long Term Care Needs in Today's Environment". We were joined by actuarial representatives Jake Corrao, Marlee Nichols, Rachel Zimdars, David Walla, and Mike Richter.

The representatives began our discussion with an overview of Northwestern Mutual, including the composition of their actuarial department and their insurance coverage, which primarily includes life insurance, disability income, long term care, annuities, and investments. We then jumped into the main topic of the day: long-term care (LTC) insurance. The representatives thoroughly outlined what it is, the history of LTC, its benefits, pricing, and challenges.

The presenters covered LTC innovations in their discussion, including Accelerated Care Benefit (ACB) Insurance and Extension of Benefits (EOB) Insurance. To compare each of these three LTC insurance products, we provide an overview:

  • LTC is a separately sold form of insurance that "protects policyholders from financial consequences of chronic illness, disabling condition, or cognitive impairment through reimbursement of some of the costs of receiving various levels of care"

  • ACB is an additional LTC benefit on a life insurance policy that includes a death benefit; policyholders receive death insurance payments from the insurance company in one of two ways:

  • (1) Lump sum upon death; this focusses the coverage on the death benefit portion of life insurance

  • (2) Smaller payments over life of the policy if the policyholder has an LTC need during their lifetime; this helps policyholders meet LTC expenses as they occur

  • EOB is another LTC addition on life insurance that extends upon the payment formats for ACB; policyholders receive insurance payments in two ways during policy's lifetime:

  • (1) Lump sum upon policyholder's death (primarily life insurance characteristic)

  • (2) Smaller payments throughout policy lifetime

  • First, can begin through death benefits acceleration

  • Second, can be paid as LTC continues by drawing from the extension pool

Our Actuarial Club members learned a lot about LTC insurance and the two forms of newer LTC innovations within the industry. We would like to extend our gratitude toward Northwestern Mutual, Jake, Marlee, Rachel, David, and Mike for their time spent with our Actuarial Club members. We enjoyed learning more about such prevalent topics, and we hope to hear from them again in the near future!

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