This paper examines the possibility of including cash-for-care benefits in life care annuities (LCAs) to help retired couples to cope with the cost of long-term care (LTC). The paper develops an actuarial model to assess how much it would cost to add an extra stream of payments to annuities for couples should either or both require LTC. We also analyse how willing couples would be to choose this type of LCA. Using Australian LTC transition probability data for a realistic calibration and assuming independence of the risks involved, we numerically illustrate the model and the theoretical findings implied. The paper highlights the importance of reporting the joint life expectancy and the survivor life expectancy broken down by health state, given that this information makes the computation of the actuarial factors transparent and provides highly useful information to help the couple understand the need to be protected against the cost of LTC services. Our proposal could be welfare-improving, especially for “dual-earner” couples, given that under the assumption that coordinated retirement behaviour exists within the couple, the availability of LCAs for couples may complete the market over and above the use of products for individuals alone.

本文探讨了将现金换护理福利纳入终身护理年金 (LCA) 的可能性，以帮助退休夫妇应对长期护理 (LTC) 的费用。该论文开发了一个精算模型来评估如果夫妇一方或双方都需要 LTC，则为年金增加额外的支付流将花费多少费用。我们还分析了夫妇选择此类 LCA 的意愿。使用澳大利亚 LTC 转移概率数据进行实际校准并假设所涉及的风险独立，我们以数字方式说明了模型和隐含的理论结果。该文件强调了报告按健康状况细分的联合预期寿命和幸存者预期寿命的重要性，鉴于此信息使精算因素的计算变得透明，并提供非常有用的信息，帮助夫妇了解需要保护免受长期护理服务成本的影响。我们的建议可能会改善福利，特别是对于“双职工”夫妇来说，因为假设夫妻之间存在协调的退休行为，为夫妇提供的 LCA 可能会比个人产品的使用更完善市场独自的。