As noted, some insurance companies offer "crisis waivers," which allow annuity owners access to their annuity proceeds under certain conditions. These include:

• Nursing Home or Hospital Confinement


• Terminal Illness


• Unemployment


• Disability

Not all companies offering crisis waivers cover all of those contingencies, nor is there uniformity in available ages, waiting periods, and costs for this feature. Some companies offer withdrawals from proceeds with no surrender charges or fees; others offer decreasing surrender charges for full or partial crisis withdrawals. Crisis waivers are not available in all states.

LTC riders typically cover catastrophic illnesses requiring home health care or nursing home stays. These riders are designed to provide benefits without cutting into the monthly payments from the annuitized annuity. Coverage varies by product; minimum premiums of $30,000 to $50,000 for the initial product purchase may be required. Many LTC riders require the base annuity to be held for up to seven years before it's fully available.

Because the risks covered by annuities and LTC insurance are related, a single insured is unlikely to need both products. That is, someone is unlikely to have an extended LTC need and then live to an old age. Insurers can "hedge" one type of risk with the other; providing the hybrid product costs less than if the two products were purchased separately.