To offer comprehensive long-term care insurance coverage at a substantially lower price, John Hancock today launched an option on the newest version of its flagship long-term care (LTC) insurance policy, Custom Care III.

Benefit Builder, an alternative to a traditional inflation option, is designed to provide automatic increases in benefits that occur gradually over time, as well as voluntary buy-up options.

Benefit Builder enables a policyholder's benefits to grow through an automatic crediting formula, which is tied to the investment earnings of a segment of John Hancock's general account, without a corresponding increase in premiums. In addition, every three years through the age of 75, policyholders will be offered the opportunity to increase benefits by 10 percent without having to answer questions about health or undergo a medical exam, as long as they clear basic restrictions.

"We wanted to offer lower-cost LTC protection that provided meaningful coverage so that Boomers in their 50s or 60s, who often are taking care of parents and children while saving for retirement, would feel financially able to address their own LTC planning needs," said Marianne Harrison, president, John Hancock Long-Term Care Insurance.

According to John Hancock, Custom Care III featuring Benefit Builder also includes the same consumer protection features found in John Hancock's other LTC insurance policies.

Harrison contends that Benefit Builder will expand the LTC insurance marketplace by appealing to younger consumers who may have competing financial priorities and cannot afford more traditional policies. She also expects the product will attract older healthy individuals who otherwise could not afford the premiums.

"We view Custom Care III featuring Benefit Builder as a break-through product that will renew consumer interest in LTC insurance by adapting to their unique needs and budgetary concerns," said Harrison.

The policy has been filed nationally and currently is available in 36 states.

Justin Stephani writes for Insurance Networking News.

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