Long Term Care Annuity Commission and Starting Comp
Updated October 2026
Short answer: A care or long term care annuity (LTC annuity) is a deferred annuity with long-term care or care-related benefits built in, so one premium works as both savings and a care fund. Long term care annuity commission (starting comp) is a percentage of premium set by product and issue age. The care annuities listed on this page start between 4.75% and 9%, with top bands that begin at age 40, 50 or 55.
Our job is to beat your current annuity commission.
Stuck at your current commission level, or simply want higher commission? Our sole purpose is to scale your business by beating your current commission levels. No matter your current commission level, if you meet our minimum requirements (solo producers have none), you automatically get higher commission than where you are today. Starting comp is for every producer, including new producers with no experience — there is no production minimum. If you have strong production to show, we contract you above our starting comp. Established agencies, financial advisors and financial firms, and healthcare agencies can earn much higher too. Submit your application, schedule a Zoom, and we review your current commission levels carrier by carrier and contract you above them — with full back office support, case management, carrier contracting and sales tools included.
How care and LTC annuities work
These are asset-based long-term care products: instead of paying ongoing premiums for standalone LTC insurance, the client repositions an existing asset, often non-qualified savings or an older annuity moved by 1035 exchange. Designs vary widely, so read each product's benefit summary. Common elements:
- Layered benefits. Many designs pay qualifying care costs from the annuity's own value first, then continue from additional coverage the carrier provides for a stated period. Others offer enhanced income or penalty-free withdrawals tied to a care event.
- Benefit triggers. For qualified LTC coverage, federal tax law defines a chronically ill individual as someone certified by a licensed health care practitioner, within the prior 12 months, as unable to perform at least two of six activities of daily living (eating, toileting, transferring, bathing, dressing, continence) for at least 90 days, or as needing substantial supervision because of severe cognitive impairment.
- Underwriting. Most products ask health questions, and requirements vary by carrier.
- If care is never needed, the money generally stays in the annuity, and the remaining value passes to beneficiaries under the contract's death benefit terms.
Tax treatment under the Pension Protection Act
Section 844 of the Pension Protection Act of 2006 amended Internal Revenue Code sections 72, 1035 and 7702B. The changes generally apply for taxable years beginning after December 31, 2009. In general terms:
- Long-term care coverage provided by a rider on, or as part of, an annuity is treated as a separate contract for tax purposes.
- Charges deducted from the annuity's cash value to pay for qualified LTC coverage aren't included in the client's income, but they reduce the investment in the contract, not below zero. Those charges can't also be deducted as medical expenses.
- Benefits from a qualified LTC contract are treated as amounts received for personal injuries and sickness, which generally makes them income-tax-free within IRS limits, including limits on per diem benefits.
- An annuity can be exchanged tax-free under section 1035 for another annuity or a qualified LTC contract.
- The combination-contract rules in section 7702B(e) don't apply to annuities held in IRAs or qualified retirement plans.
Not every care-related feature is qualified long-term care insurance, and tax treatment depends on the product's design. Confirm with the carrier, and have clients consult a tax professional. This page isn't tax or legal advice.
Which clients care annuities fit
- Clients in their 50s through 70s who are worried about care costs but don't want to pay standalone LTC premiums.
- Owners of older non-qualified annuities who could reposition that money through a 1035 exchange.
- Clients who want "use it or keep it" money: care benefits if needed, an annuity value and death benefit if not.
- Medicare and senior-market clients whose agents already discuss health and care planning.
Poor fits: clients relying on IRA money for this purpose, those who need full liquidity, and those who can't qualify under the product's health questions.
Long term care annuity commission: starting comp
Examples from the BetterAnnuityComp.com starting-comp grid, showing each product's top starting rate and where it applies:
| Carrier | Product | Top starting comp | Where it applies |
|---|---|---|---|
| EquiTrust | Bridge | 9% | Option A · Age 55-75 · Yr 1 |
| Nationwide | CareMatters Annuity | 7.5% | Age 40-75 |
| Global Atlantic | ForeCare | 7% | Age 50-75 |
| OneAmerica | Annuity Care II | 6.5% | Age 40-80 |
| OneAmerica | Indexed Annuity Care | 6% | Age 40-75 |
| OneAmerica | Annuity Care | 4.75% | Age 50-75 |
Each rate is starting comp for every producer, with no experience requirement and no production minimum; strong producers are contracted higher, and our job is to beat your current commission. See every product and age band on the annuity carrier list.
Commission structure on care annuities
- Age bands with a floor. Top bands on these products begin at age 40, 50 or 55 rather than age 0, and comp steps down at older issue ages.
- First-year rates. EquiTrust Bridge, a fixed indexed annuity with a long-term care rider, shows 9% as its year-1 rate under Option A (ages 55-75). See the annuity carrier list for its later-year schedule.
- Product design matters. OneAmerica's three care annuities start at 6.5%, 6% and 4.75%, so compare versions, not just carriers.
- Funding source. Comp is figured on premium, including premium moved in by 1035 exchange. Replacement rules and the best-interest analysis apply to every exchange.
- Training first. Selling products with long-term care benefits may require state LTC training in addition to annuity best-interest training. Requirements vary by state and carrier. Chargebacks apply under each carrier's rules.
How BetterAnnuityComp.com supports care annuity sales
BetterAnnuityComp.com is exclusive to annuity commissions and powered by BetterLifeQuotes.com, an NGA/IMO Hybrid Distribution Organization. Care cases carry health questions, exchanges and extra training, which is where support matters most.
Case management
Pre-submission review to prevent NIGO, best-interest and replacement paperwork review, 1035 exchange tracking, and carrier follow-up with status updates through issue.
Back office
Appointment and license tracking, AML and training-certificate tracking, commission questions and carrier communication.
Contracting
One streamlined contracting process across carriers, with appointments requested in the states where you're licensed.
See how files move from application to issue on our case management and support page. Running a Medicare or senior-market team? See our program for healthcare agencies.
Frequently asked questions
Can BetterAnnuityComp.com beat my current annuity commission?
That is our sole job: no matter your current commission level, if you meet our minimum requirements (solo producers have none), you automatically get higher commission than where you are today. Starting comp is for every producer, including new producers with no experience, and there is no production minimum. If you have strong production to show, we contract you above our starting comp, and established agencies, financial advisors and financial firms, and healthcare agencies can earn above it too. Submit your application, schedule a Zoom and share your current commission levels by carrier. We compare them carrier by carrier and contract you above them, with full back office support, case management, carrier contracting and sales tools included.
Are long-term care benefits from an annuity tax-free?
For qualified LTC coverage on a non-qualified annuity, the Pension Protection Act rules generally treat benefits like other qualified LTC benefits, which are generally income-tax-free within IRS limits. Charges for qualified LTC coverage taken from the annuity's value aren't taxable to the client but reduce the client's basis. The rules don't apply to IRAs or qualified plans. This isn't tax advice.
Can a client fund a care annuity with an existing annuity?
Often, yes. Federal law allows a tax-free 1035 exchange from an annuity into another annuity or a qualified LTC contract. It's still a replacement, so the best-interest analysis and replacement paperwork apply.
Is there health underwriting?
Usually. Most care annuities ask health questions, and some clients won't qualify. Requirements vary by carrier, so pre-screen before the client moves money.
What happens if the client never needs care?
The money generally remains an annuity. The client keeps the account value, subject to surrender charges, and beneficiaries receive the death benefit under the contract's terms. Check each product's design.
Sources
- IRS — Notice 2011-68, Annuity and Life Insurance Contracts with a Long-Term Care Insurance Feature
- Cornell Law School LII — 26 U.S. Code § 7702B, Treatment of qualified long-term care insurance
Add care and LTC annuities to your shelf at a higher commission than you earn today, with case management through issue. BetterAnnuityComp.com, powered by BetterLifeQuotes.com, contracts producers with 68 carriers and 345 annuity products.