What it is
An LTC annuity is a deferred annuity paired with a long-term care benefit multiplier. A lump sum — often rolled from an existing non-qualified annuity under the Pension Protection Act — becomes both an account value and, via the multiplier, a larger pool of long-term care benefits.
Underwriting is typically simplified or guaranteed-issue, which makes these contracts a common solution for applicants who cannot pass traditional LTC underwriting due to moderate health issues.
If long-term care is never needed, the account value remains available for withdrawal, income, or beneficiaries, just like any deferred annuity.
The design is well suited for repositioning a legacy non-qualified annuity into a contract that adds meaningful long-term care leverage without a new health exam.
Moderate-health applicants who cannot pass traditional underwriting but have a lump sum available.