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The American Association for Long-Term Care Insurance (AALTCI) has published a new, online guide to using “1035 exchanges” to pay for insurance products that can protect people against long-term care (LTC) risk.

Internal Revenue Code Section 1035 lets people roll cash from one insurance arrangement to another.

In the past, AALTCI has tended to focus on use of 1035 exchanges to pay for stand-alone long-term care insurance coverage.

(Related: Long-Term Care Insurance Claim Payments Rise 6.4%)

In the new guide, AALTCI offers an extensive section on using 1035 exchanges to fund annuities with LTC benefits, or linked-benefit annuities.

Using a linked-benefit annuity to protect against LTC expenses can be good for a consumer who may need to draw on the same funds to pay either for LTC expenses or ordinary living expenses, according to AALTCI.

A copy of the guide is available here.

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