The great thing about stand-alone long-term care insurance (LTCI) is that it can be an efficient way to help people prepare for long-term care (LTC) costs.

Bundling LTC protection in with life insurance, or with other post-retirement planning products, can be a great way to simplify the LTC planning process. Using a life or annuity combo product that will certainly pay a benefit to someone can lower the barriers of consumers who hate the idea of paying for LTCI coverage and never using the coverage.

Building the LTC benefits into a combo product may also help the insurer reduce the overall level of risk involved with writing the product. 

But, because retirees are much more likely to die, or collect retirement income, than to use large amounts of LTC services, using combo products to LTC risk could result in people ending up with a relatively low level of LTC protection, or putting more money than they want into life insurance or annuities to get the desired level of LTC benefits.

LTCI marketers think that building awareness is the answer, but plenty of people who know all about LTCI and have other personal protection products still don’t buy LTCI.

In the long run, once insurers get past the current, temporary problems plaguing the stand-alone LTCI market (low rates, insurers’ frustration with old underwriting forecasts, Democrats’ anger that the insurers were nasty to Ted Kennedy), maybe the solution is to figure out how to combine LTC protection benefits with the sorts of semi-imaginary products that cost little or nothing to produce, make consumers happy today, and leave lots of room for charging prices high enough to fund the LTC benefits, in such a way that, to consumers, the LTC benefits seem like a footnote to an afterthought.

Regulators get very, very angry at insurers for increasing the premiums for LTCI coverage, for example, even though LTCI helped the quality of life of about 250,000 people in 2014. 

Meanwhile, NewZoo, estimates mobile game makers generated about $4.9 billion in revenue in the United States in 2014. The game makers got that money from selling products that destroy players’ eyes and social lives. No regulator ever says a word about what app makers charge us for blinding us.

What if insurers could get in on the game money? Maybe insurers could form a syndicate that could, say, Netflix. Have Netflix double what it charges consumers to get consumers the extremely valuable benefit (wink! wink!) of having easy live access to ad-riddled broadcast TV shows on our phones.

Then have one-quarter of that revenue flow into a LTC benefits fund.

The industry could supplement the Netflix LTC benefits Green Stamps funding program with a children’s phone app game unit. Charge preschoolers’ parents a dollar month so the preschoolers can keep digital bakeries, digital restaurants and digital fish going, and design digital clothes for digital fashion models. Then have 20 cents of the dollar flow into a boring LTC benefits fund the families don’t really know exists.

Pretty soon, there might be so many young families funding LTC benefits that the cost of funding benefits would fall to about $100 per insured. The biggest challenge would be creating a mechanism people could use to find and use their benefits 80 years or so after they unwittingly started their mobile LTC funding accounts.

And, by then — sometime in the 2100s, for some of the early fund participants — the conditions that create a need for long-term care might mostly be ancient medical history. Instead of using the money for long-term care, the participants could take the money out and use it on flying cars, or artificial eyes to replace the ones the phone apps burned out.