Mutual of Omaha Long-Term Care Insurance Review

Mutual of Omaha Long-Term Care Insurance Plan Options

All Mutual of Omaha LTC insurance plans include the same built-in benefits:

• Cash benefit: This is an optional benefit you can choose as a supplement to standard claim reimbursements. You can elect to receive a portion of your policy’s benefit in cash, which can go toward services you require to support ongoing care.
• Care coordination: Mutual of Omaha provides every LTC policyholder with a trained care coordinator who will evaluate your needs, help devise a care plan, and even assist with the scheduling of certain services related to your care.
• Waiver of premium: When you’re receiving care that’s covered by your policy, you won’t be required to pay your monthly premium.
• Alternative care: If your doctor recommends alternative care to help with your activities of daily living (ADLs), your plan will still cover it.

Mutual of Omaha offers two LTC plan types: the Secure Solution and the Custom Solution. Both plans are available to eligible applicants between the ages of 30 and 79. The Secure Solution is the standard plan and includes all of the aforementioned built-in benefits. Plus, you can choose the amount of coverage you want. With the Custom Solution, you have all the same benefits, but you can also add riders for an additional cost.

Available Riders

If you opt for the Custom Solution LTC plan, you can add any of the following riders to your policy:

• Inflation protection: This add-on automatically increases your policy benefits by up to 5 percent per year to keep up with inflation and the rising costs of care.
• Shared care: If you enroll in a plan with your partner and use up all of your benefits, you can access a portion of your partner’s available benefits.
• Security benefit: This adds a small percentage to your monthly reimbursement benefit, which can go toward the cost of care or even living expenses.
• Return of premium: This rider pays you back a portion of your monthly premium, minus any benefits you received through your policy.

To avoid confusion, it’s important to note that LTC can also be added as a rider to a Mutual of Omaha life insurance plan. This allows you to access some or all of your life insurance death benefit early to pay for LTC.

With Mutual of Omaha, you can set an LTC rider limit up to the maximum death benefit of your life insurance policy, which can be accessed at a rate ranging between 1 and 4 percent per month. For example, if you have a life insurance policy of $1 million and you choose to make the entire amount available for LTC, you could potentially be reimbursed at a rate of $40,000 per month (4 percent) in the event that you become chronically ill.2

Mutual of Omaha Long-Term Care Insurance Cost

One of the best parts of getting your LTC insurance through Mutual of Omaha is the pricing transparency. When you visit the Mutual of Omaha website, you can get an estimate of your LTC insurance premiums based on your age, marital status, gender, and location. Keep in mind that the amounts you see are subject to change based on underwriting and other factors. Even so, you can still accurately evaluate your monthly costs using Mutual of Omaha’s handy calculator.

To help you understand the average costs of Mutual of Omaha LTC for different people, here are a few premiums we calculated for 2023:

• A 62-year-old single woman living in Los Angeles, California, can expect to pay:
  • $334 per month for a maximum monthly benefit of $3,000
  • $445 per month for a maximum monthly benefit of $4,000
  • $556 per month for a maximum monthly benefit of $5,000
• A 70-year-old married couple living in Atlanta, Georgia, can expect to pay:
  • $231 per month for a maximum monthly benefit of $3,000
  • $308 per month for a maximum monthly benefit of $4,000
  • $384 per month for a maximum monthly benefit of $5,000
• A 55-year-old single man living in Houston, Texas, can expect to pay:
  • $128 per month for a maximum monthly benefit of $3,000
  • $171 per month for a maximum monthly benefit of $4,000
  • $214 per month for a maximum monthly benefit of $5,000

Keep in mind, these are just estimates, and prices can vary greatly based on a number of factors. According to the Administration for Community Living, the average cost of LTC insurance nationwide was $2,207 per year (or roughly $184 per month) in 2007.3 Rates have increased with time, as the current average for a 62-year-old rests somewhere around $300 per month.4

The maximum benefits of a given plan is another major factor that can affect the price. From the examples above, you can see that simply increasing the benefit from $3,000 to $4,000 per month can increase your premium by anywhere from $40 to $100. It’s also important to note that Mutual of Omaha sets a monthly benefit limit of $10,000, or roughly $333 per day. This is relatively low compared to carriers like State Farm, which offers plans that pay out as much as $500 per day in benefits.

With so many variables to consider, it’s difficult to compare Mutual of Omaha’s rates with other carriers. That said, one of the biggest benefits of Mutual of Omaha is its substantial discounts for couples and healthy individuals. If you and your spouse enroll together, you can get a 15 percent discount. Even if your spouse chooses another carrier, you can get a 5 percent discount just for being married. And whether you’re single or married, Mutual of Omaha offers an extra 15 percent discount for being in good health at the time of your application. Mutual of Omaha does require couples to be married and live together for no less than three years to qualify for the discount.

To get an accurate estimate of your monthly premiums, be sure to check out Mutual of Omaha’s rate calculator.

Underwriting

Mutual of Omaha uses a standard underwriting process that looks at many of the same factors as most other insurance carriers. The company evaluates each applicant based on medical history, cognitive status, ability to perform ADLs, and ability to perform instrumental ADLs, like shopping, meal preparation, and housework.

Once the evaluation is complete, the underwriting team will put the applicant into one of four categories:

1. Preferred
2. Standard
3. Substandard Class 1
4. Substandard Class 2

Preferred generally means that you’re in great health and/or present a very low risk to the insurance carrier. Standard means that you’re in average health and/or present an average degree of risk. Finally, Substandard Classes 1 and 2 mean that you have relatively poor health or present a high degree of risk, which could mean that your application will be denied, or you’ll pay substantially more for your LTC policy.

Since Mutual of Omaha looks at instrumental ADLs, which generally cover a very wide range of daily activities, they’re somewhat stricter in their underwriting process than some other carriers. This means that if you struggle with certain activities, such as using a phone or climbing stairs, you could be put in one of the Substandard categories.

Mutual of Omaha Customer Satisfaction

Generally, Mutual of Omaha compares very favorably to its competitors, especially when it comes to its reliability and financial strength. Here are just a few relevant ratings to consider:

• A.M. Best: A+
• Better Business Bureau (BBB): A+
• Standard & Poor’s (S&P): AA-
• National Association of Insurance Commissioners (NAIC): 0.87

To put some of these ratings into perspective, Mutual of Omaha’s top competitors in LTC received similar scores. For example, Nationwide has an A+ rating from A.M. Best and the BBB, while New York Life has an A++ rating from A.M. Best and a B- from the BBB.

While Mutual of Omaha’s business ratings and plan reviews are generally favorable, customer feedback tells a slightly different story. Based on customer reviews, Mutual of Omaha sometimes struggles to address customer complaints and claims in a timely manner.

Final Thoughts

Mutual of Omaha is a quality LTC insurance carrier that offers plenty of extra benefits to entice new customers. While the barrier to entry and standard premiums may be a little high for some, you can often qualify for substantial discounts by being healthy or signing up with a spouse. Plus, the built-in benefits can help you save by waiving premiums during LTC and even paying you a portion of your benefits in cash. If you’re currently in the market for LTC insurance, Mutual of Omaha is worth considering.