I Don’t need Long Term Care Insurance, Think Again!
July 18, 2008
Who knows what the future will hold for us. A simple drive through the city can turn into a serious car accident that leaves you in need of long-term care for the rest of your life, depending on how circumstances fall into place. Many people understand that the worst can happen in life, but few actually prepare for it. If you do want to prepare for the possibility, there is nothing better you can do than purchase long-term care insurance.
Long-term care is something various people, at different ages, will need in their lives. It could be as a result of old age reducing an individual’s ability to care for themselves or it may be as a result of an accident that left an individual paralyzed or with a severe brain injury. When long-term care is needed, Medicare will not cover the expenses of the individual who is in need of long-term care, and that financial burden will often fall onto family. However, with long-term care insurance, that burden is removed and the individual can benefit from living the type of lifestyle, financially-speaking, that they did before they needed long-term care.
Long-term care insurance is no different than any other insurance you pay for. You pay for house insurance and car insurance on the off-chance your house will burn down or your car will be involved in an accident. The chances are low, but you make monthly payments to ensure you have bases covered. The same is true with long-term care insurance. There is a small chance you will be paralyzed, suffer a brain injury or need long-term care in your old age, but you pay into the insurance plan in case it does happen.
The foolish state that it will never happen, and if people can learn anything from life it is that anything can, and will, happen. You should never leave everything to chance and you need to prepare yourself for the possibility of you, or a family member, needing long-term care by purchasing long-term care insurance.
Purchasing long-term care insurance is not an admission that something bad will happen, but simply preparing for the possibility that long-term care may be needed in the future, and you are not going to leave the burden of that on your family or friends. Conclusion Long-term care can happen to anyone. It can be as a result of old age or an unfortunate accident, but the point is that it is not an impossibility. As a result, preparing for long-term care by purchasing long-term care insurance is incredibly important. With long-term care insurance, you will remove a financial burden from your family while you are in need of long-term care. Your long-term care situation may stretch a decade, a year, or only a few months, but no matter how long you need long-term care, long-term care insurance will be there to make things easier on everyone.
Do not leave anything to chance and prepare yourself for the possibility of long-term care with long-term care insurance.
How Does LTCi Protect Young Families?
July 17, 2008
How Does LTCi Protect Young Families? By Susan P. Payne How Does LTCi protect young families? Every day many people of all ages experience a significant change in health status. How would it impact your family if a sudden unexpected accident or illness happened? Are you prepared to handle the cost associated with long-term care? Needing long term care help is a family issue. What will happen to saving for the kids college? Your retirement? Your finances? Planning for a secure future can be possible with integrating Long-Term Care Insurance (LTCi) protection planning.
LTCi is important, yet overlooked by many. It is the day-to-day help you need when a serious illness, injury or disability makes you physically or cognitively unable to care for yourself for a long period of time. This type of care is usually provided at home, in an assisted living facility, adult day care or, lastly, in a nursing home. No one ever wants to think about a catastrophic illness or an accident like a broken leg or hip. Close your eyes and think about what life would be like with a broken hip. You could not walk, bathe or dress yourself. You would need someone to assist you in your normal activities of daily living. Could you depend on your family? Would you spouse have to miss work? Would the kids need to miss school or their sporting events?
How will having a Long-Term Care Insurance (LTCi) plan help you and your family? 1. Protects your independence,live how you want, where you want
2. Protects your family from the potential burden of being your caretaker
3. Protect your savings, college funds and retirement plans from the high cost of long term care
4. Many plans will pay for home health care providers, home health aides and caregivers, giving you freedom to choose what makes you comfortable.
Why does someone my age need to think about long-term care? Today you are healthy. But 24-hours from now, things can change. Many illnesses, once considered to be life threatening, are now life altering with the medical advances in place today. Many now leave you ‘disabled’ relying on others for care, sometimes for short periods of time, sometimes for life. Long term care protection requires you to “health qualify”. No matter how much you would be willing to pay, a change in health can make it impossible for you to health qualify for long term care insurance. For individuals who are currently young and in good health, you have the possibility of locking in “preferred rates” for your lifetime. Cost for insurance can be significantly lower at younger ages so you will save money! You lock in savings and you can never be canceled even if your health changes. You may benefit now and again later as many people need and use their benefits when they are young and again when they are older.
How does LTCi protect young families? Because things can change tomorrow, now is the right time!
Who Can Afford Long-Term Care Insurance?
July 17, 2008
Insurance is a wonderful thing. It gives us the peace of mind knowing that someone has our back, and it provides us with the security we need in the event of an accident that can alter the course of our lives. Long-term care insurance is no different, but many feel they cannot get it because they do not know how they will afford long-term care insurance. The question then comes up about who can afford long-term care insurance.
Many will wait for their near retirement to get long-term care insurance, because at that point the prospect of needing help with activities that we take for granted are only a decade or more away. As a result, many of those who get long-term care insurance are past the age of retirement and they are the ones who pay into it.
However, it is important for the young to understand that long-term care insurance is incredibly important for them as well. Anything can happen in the future and nothing is certain. Nearly half of the people who collect on long-term care insurance are individuals who are below the age of 65. This is because accidents or illnesses that require an individual to seek help with day-to-day activities, even for only a few months, are needed at any age.
So, who can afford long-term care insurance? Well, the short answer is that everyone can. When you are young, you will be able to get long-term care insurance at reduced premiums because there is a much smaller chance you will need it before you are 70. However, if you wait until you are 65, you will pay more. You should look at paying for long-term care insurance the minute you can comfortably do so, and when you have enough finances and assets that you want to protect from a possible life-altering disability. You do not want to be in a situation where you cannot afford to pay your premiums, so you need to wait until you can afford to do so, without setting yourself back. Generally, at that point in your life, you will also have enough finances and assets that you will want to protect them in the event that you need long-term care.
Summary Long-term care is an important part of any future planning for an individual and their family. It will ensure that in the event you need long-term care, you will be covered by the long-term care insurance. However, not being able to afford long-term care insurance can be a problem, but there are so many options to go through with long-term care insurance, you should be able to find at least something that will assist you in the event you need it.
Try and get the insurance when you are younger because it will cost much less, but if you can’t, try and get it, even the lowest plan, at some point. Remember, even a little bit of long-term care insurance is better than none, so look into getting the long-term care insurance that will give you the peace of mind you need.
You should just ask for help from an insurance representative who specializes in long term care insurance to answer any questions.
Long Term Insurance Fraud: How To Avoid It
July 17, 2008
We do not live in a perfect world and the risk of fraud exists. It may be a fraud through a company offering you products, or it may be fraud through con artists, but the sad truth is it exists. Long-term care insurance is not exempt from the risk of fraud, and there are those out there who will try and benefit off your misfortune and leave you with nothing. One of the important things you can learn from the mistakes of others is how to avoid being a victim of insurance fraud.
Obviously, the first thing anyone should consider when they are thinking of getting long-term care insurance is research. Researching a company is one of the best ways to prevent long-term insurance fraud. When you look at the record of a company, you will be given a clear indication of how they will treat you and your money.
You should look into the financial rating of a company to determine how legit it is, and how stable it is. Standard & Poor determines the strength of insurance companies, as well as giving detailed financial profiles on thousands of insurance companies. You can also look at Fitch Ratings, which give financial strength ratings for many insurance companies.
When you decide on a long-term care insurance policy, make sure you get the policy when you meet with the insurance broker. Do not fall for the line of ‘It is all in the brochure.’ Usually, it is not. You should be able to get the policy, in writing, when you meet with the broker and before you sign it, make sure you read it very carefully, even if you have to take it home to do so.
When you get a policy, you are asked for a month’s premium up front to process the application. If you choose not to accept the policy or you are declined, you should get your money back in full.
You can also talk to friends of yours to find out what insurance company they go through for their own long-term care insurance policies, if they do. However, do not accept their word because they could be victims of long-term insurance fraud and not even know it yet. Just research the company and if you find out something troubling, let them know. Conclusion Long-term care insurance is one of the best things you can do to make sure you are not a financial burden on your family. However, you do not want to give someone your money and find out later that you were a victim of fraud. Then, with all the money you put in, you come up with nothing and that is a horrible situation to be in. Do your research, ask questions, don’t sign anything without reading it and always make clear what you expect up front. If you do this, you should be okay and be able to prevent yourself from becoming a victim of long-term care insurance fraud. You should just ask for help from an insurance representative who specializes in long term care insurance to answer any questions.
How Does Age Affect The Price Of A Long-Term Care Policy?
July 17, 2008
As you grow old, some things like dinners out and movies become cheaper due to senior discounts. However, conversely other things become more expensive, and usually those things are insurance. As a result, when you are getting a long-term care policy, your age is going to have a big effect on the price of a long-term care policy.
Look at it from the insurance company’s perspective. They have a 30-year-old computer programmer who works from home and rarely travels. As a result, he is considered low-risk and his insurance premium costs are going to be as low as $20 per month. However, for an individual who is 67 and has a heart condition, the costs become much greater because there is an increased risk that the individual will have to collect on the policy soon.
A 30-year-old can pay $20 per month for years and offset the cost of the long-term care expenses for the company very early on. This is not the case for the 67-year-old. The insurance company will need to collect as much money as they can before the individual needs long-term health care so they can offset the costs of his care.
As a result, age has a huge affect on the price of a long-term health care plan. The younger you are, the less you will pay, while the older you are the more you will pay. Hence the reason you should try and get the care you need at an early age so you can benefit from those low costs.
As you get older, you are in a greater risk area of suffering several debilitating health problems. The insurance companies look at this and they determine your eligibility for long-term care insurance programs as a result.
Do not be surprised if you end up paying over $100 more than someone 20 or 30 years younger than you. If you want to save money on your premiums, and not put more financial strain on yourself to make the payments each month, you are going to need to try and get yourself into a long-term care insurance plan early so that you have a low price for long-term care.
Conclusion It is an unfortunate reality of life that the closer you get to needing long-term care, the more you will pay on the price for long-term care insurance. Insurance companies will look at you in terms of risk, and if there is a greater risk they will be paying out sooner than later, they are going to attach higher monthly premium payments as a result. You have less time to pay towards your long-term care insurance policy, and as a result, they need to offset the potential costs of that plan by getting as much money before you need long-term care as they can.
As with anything to do with money and saving, starting earlier is always better than starting later. Long-term insurance plans are no different and early planning on your part, will mean an easier premium payment from the insurance company.
You should just ask for help from an insurance representative who specializes in long term care insurance to answer any questions.
Simplifying Long Term Care
July 16, 2008
What is Long-Term Care? When people consider the subject of long-term care, they often think about nursing homes. In fact, long-term care has little to do with nursing homes. Understanding the difference can help you protect your family and finances.
The Consequences of Living Longer
Long-term care is a continuum of care services and housing that you will need later in life. Think you won’t live a long life? Think back 25 years ago. If you had cancer or a stroke, you simply died. Few ever heard of Alzheimer’s. Today, it is the leading cause for long-term care services. The longer you live, the more likely you are to need care. The question is not who will take care of you, because your family will most often, but rather what will that care do to your family and finances.
Long-Term Care is Usually Custodial Care
Long-term care is defined as needing assistance with your activities of daily living (toileting, bathing, dressing, eating, transferring from one point to another, and continence). It also includes cognitive impairment so severe that the individual needs constant supervision. If you need custodial care, chances are it will be delivered in the community, not in a nursing home. Many of you have heard compelling statistics from The New England Journal of Medicine stating that 43% of those over age 65 will need nursing home care. What the article actually said is that that number may spend some time in a facility. The fact is, few end their days in one. Every study conducted finds that care is overwhelmingly provided at home. The key question, of course, is who is going to pay for it? Who Covers the Cost?
Medicare & VA
Medicare, the primary health care program for retirees pays only for skilled or rehabilitative care, not custodial care in any venue. Medicaid, a federal and state program for financially needy individuals will pay for custodial care, but primarily in nursing homes. Funding for home care and assisted living is very limited and based on availability of funds. Veterans believe that the VA will pay for home care, adult day care, or assisted living. As with Medicaid, funding is limited and generally based on service-related disability. In fact, the federal government has as much said this to veterans by encouraging them to purchase long-term care insurance through the new Federal Long-Term Care Insurance program. The result is that consumers are forced to pay privately for their care. Unfortunately, the best thought-out retirement plan rarely takes into consideration living a long life. Put another way, those assets and income have been allocated to pay for retirement, not for the consequences of living a long life. This results in the need to invade principal and divert income. As a result, one of a seniors’ greatest fear, outliving their assets, literally may come true.
The Role of Long-Term Care Insurance
The use of long-term care insurance thus becomes an important part of planning for disability caused by living a long life. The product has two roles: helping keep families together and allowing your retirement portfolio to execute for the purpose for which it was intended, namely retirement. From a family perspective, who will provide your care? Like it or not, children will play a key role. Long-term care insurance (LTCI) doesn’t replace the need for family involvement in providing care but rather builds on it. It pays professionals to assist the person with the toughest tasks such as toileting, bathing, feeding and continence. This, in turn, allows the family to provide care better and longer at home. That leads to a critical question: have YOU planned for the consequences of living a long life? From a financial point of view, LTCI allows your retirement plan to stay intact. That is particularly important given the recent steep decline in portfolio value. The product, in effect, protects the balance of your account value. LTCI also protects income. Although you may qualify for Medicaid to pay for nursing home costs by transferring assets, your income (pension, social security, IRA and or 401k payout) cannot be protected. When buying this insurance, look for a long-term care specialist. Consider their training, educational credentials, and commitment to help solve your long-term care needs. The key is whether they talk first about a plan or a product. If they are interested in the plan, you are dealing with a professional. If they focus first on product and price, consider getting another opinion.
Beware of Reverse Mortgage Scams
July 16, 2008
Reverse mortgages are being used by more and more seniors in an effort to get a loan that does not have to paid back until they move or die, giving them the funds they need to pay for their own long-term care, without relying on family or insurance. It is an incredibly popular practice for those over the age of 62, who own a home and don’t want to be a financial burden on their families. In fact, they are the most popular type of loan for Americans over the age of 62.
However, seniors who are in need of some loan cash sometimes fall into the traps of reverse mortgages scams through fake websites and reverse mortgage companies who charge too much. This is a horrible situation for a senior to be in, because they may lose thousands of dollars to the scam artists, turning them into a severe financial burden for them family.
Usually, the scam is perpetrated through telemarketing, with the senior being contacted by phone and convinced into giving up their personal information for the ‘loan’. The personal information is then used to steal the senior’s identity, often taking out a loan in their name, but making the senior foot the bill for the interest charges and monthly payments.
In the case where the senior thinks they are dealing with a legitimate company, they may be dealing with a phony reverse mortgage companies. These companies will charge six to ten percent of the entire loan amount just for the senior to get the name of a reverse mortgage lender. This is one of the most common types of scams. You can actually get information on who provides reverse mortgages, free of charge, from the Department of Housing and Urban Development.
As a result, if you are looking for a reverse mortgage, you need to be incredibly careful not to fall into the trap of a reverse mortgage scam. You should always make sure that before you sign anything, even if the agent is urging you to, you do your research into the company to find out if they are a) legitimate and b) financially stable.
It is also an excellent idea to sign the contract in the presence of a lawyer, advisor, or your children. This will help to avoid the tactics that have been laid by the reverse mortgage scam artist. However, if you simply want to avoid becoming a part of reverse mortgage scams, then you should simply not do your reverse mortgage dealings over the internet or phone.
Conclusion Reverse mortgage scams are one of the worst scams perpetrated by scam artists because it prays on the elderly and their desire to be financially secure after they have left the workforce. All reverse mortgage scams do is rob them of their money by forcing them to pay large sums up front, or by stealing personal information. To make sure you do not fall into a reverse mortgage scam, do your research and never, ever sign anything under pressure, or pay money up front without consulting an adviser first.
How Can Long Term Care Insurance Keep Up With Inflation?
July 16, 2008
How can long term care insurance Keep Up With Inflation? When purchasing a long term care insurance policy, it is important to have an inflation protection rider included in your policy.
Since many people who purchase policies do not access their benefits for many years, having inflation protection helps keep your policy competitive with the rising cost of care. A 5 percent compound inflation protection rider is recommended for individuals purchasing long term care insurance who are under age 65. A more modest inflation protection option of 5 percent simple interest is recommended for people over age 65. With compound inflation doubling in 14.3 years, a 50 year old who purchases a $150 daily benefit with 5 percent compound inflation protection will have a $300 daily benefit by the time they are 65. The daily benefit will have grown by 5 percent compound each year. With simple inflation doubling in about 20 years, a 65 year old that purchases a policy with a $150 daily benefit and 5 percent simple inflation protection will have a policy that will have grown to $300 by the time they are 85 years of age. The daily benefit will have grown by 5 percent simple each year.
These types of inflation protection are automatic. The daily benefit will automatically increase by 5 percent compound or simple each year and premiums will stay level. We know what the cost of care is today but in 20 or 30 years when an individual is more likely to go on claim, having a policy without inflation protection will not provide enough coverage when it comes to claim time. Although having the inflation protection rider in your policy has been proven to keep your policy competitive, this finding is also due to the shift in care received in nursing homes toward assisted living and home and community based alternatives.
Recent studies have shown that more than 80 percent of the costs of care will be covered by such policies. Other options include a Guaranteed Purchase Option (GPO), or the option to increase coverage. This option differs greatly from an automatic inflation protection rider. Having a GPO is not automatic and your premiums are not level. With a GPO you can choose to increase your benefits periodically for example, every two or three years. A GPO usually gives you the option to increase your benefit by 5%, 10% or 15% of the original amount of your daily benefit. When you do increase your benefit, your premium will increase. The increase in premium is dependent upon the age you are at that time. If you increase your daily benefit regularly then you usually do not have to show evidence of insurability. If you do not regularly increase your benefit, you may not be given the chance again.
Inflation protection can be one of the most important decisions that you can make when purchasing a long-term care insurance policy. With the rising cost of care it is important that your benefits have raised throughout time or you may find years from now your policy is not adequate enough to pay for your care.
Long-Term Care Insurance, Prepare for the Unthinkable
July 16, 2008
It would be a wonderful world if nothing changed and everything remained the same. We would not age, die or need medical care in any way. However, the sad truth is that the world is a dynamic and ever-changing place, where nothing remains the same. We may hope that things will remain the same, but they never will, and it is up to us to prepare ourselves for the possible future outcomes that can be difficult to envision. One such way to prepare is through the purchase of long-term care insurance, which can be your best bet for a financially stable life when long-term care becomes an issue for yourself, or a loved one.
Long-term care can happen to anyone, either through old age or an accident. Few would have ever thought that the man who played Superman in four movies would ever need long-term care. He was an excellent example of a fit and healthy human being, but at the age of only 42 he fell off of a horse and was paralyzed from the neck down. For the next nine years he required long-term care. So, you see, the unthinkable can happen to anyone, at anytime, anywhere.
With long-term care insurance, you are preparing for the unthinkable by taking your own future in your hands and ensuring your financial stability, as well as the financial stability of those around you. Studies have shown that long-term care costs for individuals are often paid by immediate family. So, when you fail to plan for the future with long-term care insurance, you are not only jeopardizing your own financial stability, but that of your family.
Long-term care insurance is the best option an individual has for planning their future. The future may be one of vacationing, traveling and enjoying life in retirement, or it may be one of long-term care due to problems relating to health and disabilities. Either way, there is no harm to preparing for long-term care scenarios should they happen. When you buy a sports car, you are not planning on crashing it, but you get insurance nonetheless. You are not planning on being sick in your old age, but it can happen so you should prepare for it with long-term care insurance.
Conclusion Long-term care is a sad reality of growing old. As we get older, the need for long-term care becomes greater and greater, eventually encompassing our entire lives. In this scenario, you want to make sure yourself, and your children, will not be financially burdened by your long-term care needs. With long-term care insurance, those financial needs are taken care of, leaving your children, and yourself, financially secure through some difficult times. Don’t leave anything to chance. Take the steps to make your long-term future secure in the case of long-term care needs. Long-term care insurance is your best defense against a destitute and financially-trying retirement. Chance favors the prepared, so don’t leave long-term care to chance. The small price is well worth the huge benefits it can reap.
You should just ask for help from an insurance representative who specializes in long term care insurance to answer any questions.
What Do I Look For In A Long Term Care Insurance Company?
July 16, 2008
What do I look for in a good company? You know that you should buy long term care insurance, but where should you look and which company should you consider? A lot of advisers either sell one company’s policy, or they only sell a few policies a year, or truthfully, they really don’t know. So what do you look for in a good company?
We’ve all heard that any insurance policy is only as good as the company standing behind it, but what does that mean? It means that the company must meet the standards of an excellent and superior rating. In order to achieve a rating like this a company must meet certain requirements. Look for:
Financially sound companies Committed companies with a large client base Claims paying history Length of time selling LTC insurance History of rate increases
They all sort of blend into one another, but let’s look at them in detail:
Financially Sound Companies Check their ratings with the companies that rate the strength of insurance companies. Generally you can get a good flavor of the company’s financial strength by looking at their A.M. Best rating. If you want to back up your findings, you can by looking at Standard & Poor, Moody’s, Fitch, Duff & Phelps or Weiss Research, A.M. Best usually gives a very good overview of the companies strength and the companies don’t have to join the rating service in order to be rated.
Where do I get this? Updates are published monthly, quarterly and annually and can be found in any public library. In addition, you can usually find the ratings on each company’s web site. Do this first and then ask your agent.
Committed Companies With A Large Client Base “The theory of large numbers” works here. The larger the client base the better buffer you have against rate increases. As claims come in the companies need to financially spread these over their client base. If larger claims come in than forecasted then the company has to decide whether to absorb this into its projected cost of business or to pass this along to policy holders in the form of a premium rate increase. Companies who have made a commitment to this line of business normally do not raise premiums. A smaller, uncommitted company may be more inclined to do this.
Where do I get this? The company web site should have their policyholder information readily available. Also the agent representing the company should have their marketing materials, approved by the state where you live, that give policyholder information. In addition, you can get more information from the rating agencies, A.M. Best etc.
Claims Paying History Sometimes a good financial rating may not tell the whole story. Some companies with good ratings have been known to deny or delay paying claims in health insurance. If they use that same practice in other areas, then there is a good chance it will do so for long term care insurance claims. Also, it is important to ask how many claims have been paid since they started selling LTC insurance.
Where do I get this? Call your state insurance department for information on the complaints filed about specific companies. If this isn’t available then sometimes you need to use your own judgment based on size and reputation of the company. A well-known company is less likely to risk bad publicity for this type of action.
Length Of Time Selling LTC Insurance The Company that you choose should have been selling long term care insurance since the early 1990’s. If they haven’t then they probably have not been in the business long enough to have experienced enough claims. Without good claims experience then a company can’t tell if they have set their premium rates correctly. You do not want a company to find out that they set them wrong to begin with and you are the recipient of a “rate adjustment”.
Where do I get this? Once again if you look at the same sources from the above items you will find this information. The state approved company marketing materials will have this information as well as an informed LTC insurance agent. History Of Rate Increases Any company that has ever had a rate increase to its existing clients should not be a company for primary consideration. There are always exceptions to this especially when it comes to health issues and the need for coverage from a company that specializes in these problems.
Where do I get this? You can always contact your state department of insurance and ask them, or ask your agent. However, a sure fire way to do it is to ask your agent for the first page of the long-term care insurance personal worksheet for that particular company. This is a part of their application and will always show their rate increase history.
Finally! Now we know what to look for in a good company. The ideal company will be very large and financially sound. It will have a lot of long term care insurance clients and will have sold these policies since the early 1990’s. In addition it will not have any complaints with your state insurance department concerning the payment of claims. And finally, the ideal company will have a good reputation and will not have ever raised rates to their existing clients in any state.
