How do I get a Long Term Care Insurance Quote?

One of the best ways to receive a Long Term Care Insurance quote is from a Long Term Care agent that specializes in Long Term Care Insurance and preferably an “independent agent”.  An independent agent versus a “captive” agent (only works for one company) will bring several different carriers to the table.  An independent agent’s loyalty is to you their customer, not to a particular insurance carrier that might not have the cheapest policy available. 

Many independent agents have software on their laptop that allows you to compare apples to apples between several different insurance companies.  Let’s say you are interested in $200/day for a daily benefit with a coverage term of five years.  An independent agent will be able to show you quickly the pricing for several different Long Term Care insurance policies from different carriers.  Then you can quickly determine if Allianz, Genworth, or John Hancock is right for you.  There are many more providers, we only mentioned some of the most common.

Finding an independent agent is as easy as searching on the internet or opening your local yellow pages.  Many independent agents work off of referrals, so a good place to check is with your friends and family members that already have a policy.

You can also check with your life insurance provider or homeowners insurance provider.  Many of these carriers offer Long Term Care Insurance…but remember, those are captive agents/companies.

Finally, each carrier has their own specific underwriting criteria for your health rating.  An independent agent also understands the nuisances of each company and will most likely be able to save you time and money choosing the most appropriate policy for your specific needs.

Is Long Term Care insurance good for single people?

As a Long Term Care insurance agent I run into many diverse family situations.  Second marriages, widows, never married, and divorced situations.  More often as of late I’m running into single people that have no children or their children are hundreds of miles away.  Basically, they have nobody close by to take care of them. 

One of the benefits of having a strong Long Term Care Insurance policy is that the financial burden will be lifted with a properly designed policy but also the financial stress put on your children will be lifted.  The other aspect is if you are single and nobody close by can assit with care giving, therefore, a nice Long Term Care insurance policy can protect your assets.

I read a great article on this very subject in The Dallas Morning News where Scott Burns answers a similar question.  You can read that article at Dallas News Extra Blog.

Get a fast, easy, and free quote on Long Term Care Insurance of all types. Please click and fill out the form for a no-obligation long term care quote.

Long Term Care Insurance inflation protection is a must have

This week I was filling out an application with a husband/wife when we were reviewing the inflation protection option.  They told me about their parent’s (in their 80’s) who purchased a policy years ago with ony $80/day coverage.  I said that should be fine as long as they have inflation protection attached to the policy…which unfortunately is not. 

Inflation protection is one of those “must haves” on almost all properly designed Long Term Care Insurance policies.  A good rule of thumb is to select 5% compound inflation if you are purchasing a policy under the age of 70 years old.  If you are over 70 years old when purchasing your policy then 5% simple interest is fine.

Inflation protection will increase your daily benefit thus increasing the total “pool” available in your policy.  For example, if you purchase $200/day now with 5% compound inflation, then next year you’ll actually have $210/day coverage.  The following year that $210/day will increase by another 5% and so forth.  With the increasing cost of health care and long term care, properly designing a policy today can save you from disappointment 20 years down the road.

Long Term Care Insurance policy International coverage

If you live in the United States and own a Long Term Care Insurance policy from one of the larger carriers you probably have an International Coverage clause.  This built in rider will typically cover you for up to 70% of your daily benefit.  The term of the coverage will limited to a specific amount of time that may differ dramatically from your US coverage.  730 days is a common limit length for coverage that most carriers provide.

The intent of this rider is to protect you while traveling.  Let’s say you take a vacation to Europe and while in London you become ill and suddenly you need help with performing two of the seven ADL (Activities of Daily Living).  After your elimination period is satisfied (deductible) you’ll start to receive benefits at 70% of your daily US benefit amount and again, for a limit of 730 days (2 years).

This is a nice benefit to have but if you plan on retiring to another country it’s a good idea to consult with your insurance carrier and review specific coverage options.

Minimum assets needed to purchase a Long Term Care Policy

Do we have enough to protect?  This question is often asked when trying to decide if buying a Long Term Care Insurance Policy is worth it or not.  This is really an individual decision and many financial planners differ in their view.  A common point of view is that you need at least $250,000 in liquid assets beside your home.  If you have $5 Million liquid, then you may be in a position to self insure.

I read a great explanation of this at Boom Tip.  This post quotes Gerri Wills of CNN money.com on this exact subject.  You can check out this post at Boom Tip.

What’s the correct Long Term Care Policy daily benefit amount?

I’m often asked when meeting with clients “what daily benefit dollar amount should we select?”.  The quick response is “as much as you can afford”.  The policy price is determined by your health rating, length of benefits and of course, the amount of that daily benefit.  When Long Term Care policies first came out years ago most agents were recommending $100/day.  With the cost of care increasing with inflation, the amount you should select now really depends on your financial situation, age, geographic location.  If you are in a metro area and plan of retiring in an high cost of living area then a higher daily benefit will help.  A good way to do a little homework is to call a local nursing home.  If the going rate in your area is $6,000 per month…and you divide that by 30 days then we know $200/day would cover most of your costs today, assuming you add inflation protection to your coverage (which is a must for anybody purchasing a policy that is less than about 72 years old).  I typically recommend a range of $150/day to $220/day depending on your assets, age, and where you plan on retiring to.  Also, if this policy will be your only way to cover your long term care costs…then a higher daily benefit is needed.  If you have substantial assets and this policy is going to be used to mitigate most of your costs….then you could select a slightly lower daily benefit.  $200/day is typically what most of my clients purchase today.

Get a fast, easy, and free quote on Long Term Care Insurance of all types. Please click and fill out the form for a no-obligation long term care quote.

Long Term Care Health Insurance

Get a long term care insurance quote

There are four policies everyone should have if possible. These are life, health, disability and long term care. These four policies will cover everything life throws at you, life insurance for taking care of things after your death, health insurance for taking care of you if you get sick or injured. Disability insurance protects you if you are injured and are unable to work either temporarily or permanently and long term care takes care of you if you end up with a disability or illness that prevents you from being able to take care of yourself.

Considering what each one of these would cost you on a monthly basis you may be asking yourself why should you pay out all this money for life, disability and long term when it chances of you needing it are significantly less than you needing health insurance.

While there is the chance that you may not actually need long term care insurance take a look at what the costs of long term care. These costs are estimations and may vary based on additional factors such as location and facility type. On average for a semi private room at a nursing home you can expect to pay somewhere in the neighborhood of $68,000. For home care which consists of visits about 3 times a week, you are looking at about $18,000 a year.

Of course, these numbers can vary significantly depending on a variety of different factors such as how much care you need, what type of care you need, who you are receiving the insurance through and where you are located. There are also different rates for home care visits on weekends, holidays, how long the visits are, and then there are community programs such as adult day service.

Now that you have an idea of how expensive this type of service can be you may be able to see why there is a need for this type of insurance policy. Another thing is that many people believe that Medicare will help to provide for long term care.

Well, they do provide for it under certain situations such as when you need skilled medical services or recuperative care. It does not however pay for the majority of the activities which are covered under long term care insurance. These are the daily living activities such as eating and bathing.

Medicaid provides for more than Medicare but you have to meet the criteria for income and functionality which may be difficult for most people to meet. There are other programs which assist in long term care but they are usually for highly specific populations.

Based on this the average individual can not afford to pay for these services out of pocket based on retirement income and unless criteria are met there are no public assistance programs that will assist with these expenses. The expense of unaided long term care alone is well worth the consideration of purchasing this type of protection. Not only is cost a considering factor but also the piece of mind of knowing that should a situation that requires long term care arise you and your family are protected and you can be assured of the getting the care you need.

Get a fast, easy, and free quote on Long Term Care Insurance of all types. Please click and fill out the form for a no-obligation long term care quote.

Long Term Care Health Insurance Costs

One of the biggest things with long term care health insurance is the question on whether or not it is worth the expense that comes with it. Long term care health insurance is designed to assist individuals who are experiencing a disability or disease which affects their ability to handle tasks on their own. Get a long term care quote.

The costs are something to definitely consider. As with any policy, there are premiums and there are levels to what it will cover. With long term care health insurance the amount of coverage increases over a period of time as the risk of needing the insurance increases. However, along with the increased coverage there is also an increase in out of pocket expenses and an increase in premium just like any other insurance.

Getting quotes from a number of companies is a good idea. As with any insurance product coverage and premiums may change based on the company so researching the various options is definitely something to do before choosing a company. Make sure when you get a quote to look into exactly what it covers, what conditions are in place and what happens if run out of your benefit allowance or if you decide to cancel your coverage.

Here are some numbers to consider these numbers are based on the length of time coverage has been held. After 10 years your out of pocket expense will about $18,000 with a coverage amount of just under 200,000. At 15 years, out of pocket expenses will be about 27,000 and your coverage sits at around 217,000. At 20 years your out of pocket expense will be around 36,000 with a coverage rate of around 239,000. After 25 years out of pocked expenses will be 45,000 with only 264,000 in coverage.

There are also opportunity costs. If you do not know what an opportunity cost is, it is the cost of using a resource slated for a particular activity that is equal to the income which is lost by not using it for an alternative. In other words how much is it going to cost you to put money into long term care health insurance instead of into another type of insurance or using it for another activity all together.

For the sake of this example let us set the opportunity cost percentage at 7%. Based on the numbers used about after 10 years the opportunity cost will be about 26,600, 15 years, 48,000, after 20 years it will be 79,000 and after 25 years it is 122,000 dollars. This is considered to be a high opportunity cost especially if the coverage is never used or if the full coverage is not needed.

These numbers are subject to changes and are only an example. Opportunity cost percentage may be higher or lower as will be out of pocket and coverage amounts depending upon the company you choose. Though most rates are comparable there are companies just like with any other insurance that are higher or lower on their premium amounts.

Get a fast, easy, and free quote on Long Term Care Insurance of all types.

Please click and fill out the form for a no-obligation long term care quote.