Agent Owner, Gilmore Insurance Services, Marysville, Washington State
Why do I need long term care insurance? You may not. The choice to purchase long term care is an individual one that depends on what a person wants to protect. If there are assets a person wants to hold onto or even pass along to family, a long term care policy makes great sense. If there isn't that desire, then it makes less sense. The main reason for many insurance purchaese that they create instant money to pay for something needed. Insurance does this so the individual can avoid liquidating other assets.
Syndicated Financial Columnist, Host of the weekly talk show Steve Savant's Money, the Name of the Game, Scottsdale Arizona
The #1 risk to retirement is human l;longevity. Living longer means your retirement money has to last longer. Most seniors are on a fixed income, so any additional expenses can have a significant impact. Long term care insurance can mitigate the cost of assisted living and/or nursing home confinement.
Not everyone needs long term care insurance. LTCI is not for persons who are struggling to meet their day to day living expenses, rent an apartment, and have little savings and no investments. If such a person needed to go to a nursing home, Medicaid will almost immediately start picking up their tab and they will be fine.
Long term care insurance is for those who have substantial assets or income that they don't want to "lose" by paying high long term care costs. Some people are OK with their savings going to long term care expenses, if needed. They figure that is why they saved. Others feel strongly that they want to pass that wealth to heirs to continue a business, care for a disabled adult child, or help grandchildren go to college, among a myriad of other reasons. It is this latter segment of the population that "needs" long term care insurance, especially if they are not so very wealthy that paying nursing home expenses for many years would simply dent their resources, rather than deplete them.
If they can afford long term care insurance, but would not be able to to pay for long term care services, people who are adamant about choosing the type of care they receive, or persons who are setting up a plan so that their children don't have to worry about it, also could use long term care insurance.
As long as Medicaid is around, no one absolutely needs long term care insurance. But for all the reasons above, many people would consider it a need if they looked at it realistically.
Business Development Officer, T.D. McNeil Insurance Services, Fresno, California
Roughly sixty percent of Americans will require long term care services sometime during their lifetime. This is not exclusively a problem for the elderly as younger people can require this type of care some times. This level of care includes a range of services including skilled and custodial care that is provided over a long period of time. These requirements come from chronic sickness or injury, cognitive impairment and physical disability.
Hospitals provide acute care. Medical care given over a long period of time for chronic conditions is where the need for long term care arises. Sometimes custodial care is required because the patient has lost the ability to do one of the recognized activities of daily living or instrumental activities of daily living.
Most of the long term care given in the US is given by family members. However, there are many situations where family members cannot provide necessary care. Professional and non-professionals can provide aid and assistance to these people.
This long term care can be given in the home of the patient or in a variety of institutional settings. Long term care can be given in day-care facilities, nursing homes, and assisted living facilities. On average men need more than two years of long term care while women need almost four years on average?
The leading causes for patients requiring long term care are dementia, arthritis, cancer, stroke and nervous conditions. Caring for a patient in a home setting can cost up to $150,000 per year. The cost for a nursing home bed is about $75,000 per year (this varies by location.)
There are basically four ways to finance long term care. The family can take the expense out of their own pocket, they can look to government programs (if they qualify,) they can use long term care insurance or they can rely upon charity.
For a variety of reasons long term care insurance has provided a solution for many people. LTC insurance provides predictability for an otherwise unpredictable risk. It has become such popular coverage and policyholders have been so reluctant to drop their coverage that the benefits have started exceeding the premiums. It is quite popular among wealthy policyholders. Many companies that offered coverage have withdrawn and others have been forced to raise their premiums. This adjustment seems to be complete now.
There are various forms of LTC coverage. Policies different widely. It is rather difficult to compare but is worth the effort. When deciding on a policy the first thing to establish is the amount of coverage you want and the period of time you want coverage. The second consideration is how soon after the start of long term care will you want the policy to start paying. This waiting period is computed in several ways so care must be exercised to make sure you are making a fair comparison.
Not all policies use the same events to trigger benefits so care should be taken in this area as well. This can be a very technical area so compare your situation with the policy requirements.
How a policy pays out will vary according to the policy. Some policies provide for reimbursement of expenses, others use an indemnity form which pays up to a specific limit of expenses incurred on each specific day, and some are on a cash model which pays a maximum benefit regardless of the actual cost of the care that is being given.
Long term care insurance is a way to protect assets. The alternatives deplete assets with the government programs requiring a person to be in poverty.
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Long term care insurance is for those who have substantial assets or income that they don't want to "lose" by paying high long term care costs. Some people are OK with their savings going to long term care expenses, if needed. They figure that is why they saved. Others feel strongly that they want to pass that wealth to heirs to continue a business, care for a disabled adult child, or help grandchildren go to college, among a myriad of other reasons. It is this latter segment of the population that "needs" long term care insurance, especially if they are not so very wealthy that paying nursing home expenses for many years would simply dent their resources, rather than deplete them.
If they can afford long term care insurance, but would not be able to to pay for long term care services, people who are adamant about choosing the type of care they receive, or persons who are setting up a plan so that their children don't have to worry about it, also could use long term care insurance.
As long as Medicaid is around, no one absolutely needs long term care insurance. But for all the reasons above, many people would consider it a need if they looked at it realistically.
Hospitals provide acute care. Medical care given over a long period of time for chronic conditions is where the need for long term care arises. Sometimes custodial care is required because the patient has lost the ability to do one of the recognized activities of daily living or instrumental activities of daily living.
Most of the long term care given in the US is given by family members. However, there are many situations where family members cannot provide necessary care. Professional and non-professionals can provide aid and assistance to these people.
This long term care can be given in the home of the patient or in a variety of institutional settings. Long term care can be given in day-care facilities, nursing homes, and assisted living facilities. On average men need more than two years of long term care while women need almost four years on average?
The leading causes for patients requiring long term care are dementia, arthritis, cancer, stroke and nervous conditions. Caring for a patient in a home setting can cost up to $150,000 per year. The cost for a nursing home bed is about $75,000 per year (this varies by location.)
There are basically four ways to finance long term care. The family can take the expense out of their own pocket, they can look to government programs (if they qualify,) they can use long term care insurance or they can rely upon charity.
For a variety of reasons long term care insurance has provided a solution for many people. LTC insurance provides predictability for an otherwise unpredictable risk. It has become such popular coverage and policyholders have been so reluctant to drop their coverage that the benefits have started exceeding the premiums. It is quite popular among wealthy policyholders. Many companies that offered coverage have withdrawn and others have been forced to raise their premiums. This adjustment seems to be complete now.
There are various forms of LTC coverage. Policies different widely. It is rather difficult to compare but is worth the effort. When deciding on a policy the first thing to establish is the amount of coverage you want and the period of time you want coverage. The second consideration is how soon after the start of long term care will you want the policy to start paying. This waiting period is computed in several ways so care must be exercised to make sure you are making a fair comparison.
Not all policies use the same events to trigger benefits so care should be taken in this area as well. This can be a very technical area so compare your situation with the policy requirements.
How a policy pays out will vary according to the policy. Some policies provide for reimbursement of expenses, others use an indemnity form which pays up to a specific limit of expenses incurred on each specific day, and some are on a cash model which pays a maximum benefit regardless of the actual cost of the care that is being given.
Long term care insurance is a way to protect assets. The alternatives deplete assets with the government programs requiring a person to be in poverty.