What You Think Really Does Matter!
Why Do I Need Long-Term Care Insurance
Does it Pay to Have Long-Term Health Insurance
We plan for just about every detail in our lives from the dinner menu to funeral costs. We buy the reassurance of insurance policies to protect our vehicles, homes, health, pets, and expenses surrounding death. What most of us neglect to plan for, is the increasingly real cost of long-term health care. That comfortable nest egg you have worked so long and hard to build, can turn into a big goose egg in no time at all once the daily cost of long-term care starts to add up. Can we effectively plan for such financially crushing long-term care concerns? To some degree yes; but it takes some dedication and time to wade through the intricacies of understanding how long-term health care insurance can work best for you.
Define Long-Term Care Insurance
Long-term care insurance basically covers your cost of care for those things not usually covered by your health insurance, Medicare, or Medicaid. It is an insurance that protects your fiduciary well-being in the face of a longer than expected care situation.
Just Tell Me the Best Long-Term Care Insurance
To find the right long-term care plan specifically for you is a tricky ordeal. Every person has their own financial restrictions, care requirements, existing health issues, and many, many other elements that only pertain to you. This makes finding overall insurance coverage a very individually designed quest. Most importantly, finding an insurance agent you can trust to define your concerns and needs in writing within your policy, can seem as difficult as fishing in the middle of a dessert.
Less Than 50% Qualify
Will Medicare Pay for Long-Term Health Care
Medicare is not the answer when it comes to a long nursing home stay. It just won't cover this kind of care. And if you are counting on Medicaid, consider this; less than 50% of those who apply for assistance actually end up qualifying for it. You will have to run the gauntlet of proving you are financially ruined. Before you will be given any aide, using up the majority of your own hard-earned money has to occur. It boils down to this; the government will only give you aid once your financial worth is reduce according to the amount each individual state has mandated to qualify for assistance (you must first find yourself at the poverty level before your state will qualify you for aide).
Can I just Hide My Money From the Government
I suppose you could hide your money from the government, but it would take some planning very far ahead of time. This is because the government will dish out a number of fines and penalties for all money you "gift" to anyone during the previous five years. So, hiding your assets is not going to be the answer either. Keep in mind, malicious or deceptive behaviors can get you into a deeper mess than the one you may already be encountering.
Hidden Concerns With Long-Term Care Insurance
Once you feel you have everything under control and you are satisfied with your choice of policy for all manner of life and property, you can relax, feel the assurance of a job well done. Right? Well maybe not. Here are few things to be aware of when it comes to choosing the best policy for your situation:
Top Ranked Big Name Long-Term Care Insurers
John Hancock Life Insurance
Massachusetts Mutual Life Insurance
Metropolitan Life Insurance
New York Life Insurance
Northwestern Long Term Care Insurance
Prudential Insurance Company of America
Protect Yourself From These 6 Insurance Policy Nightmares
- If you suddenly can not make your payments (because of income reduction or other reasons) you will loose everything you have already paid into the policy.
- You have to gamble on what type of care you will need in the future. If you don't buy the correct coverage, that policy just won't help. So, define broadly the coverage you are paying for.
- Some insurance companies have been found to be very untrustworthy, so paying less may cost you more in the long run. A company's good reputation is well worth the price.
- An insurance company can deny claims, tying you up in court or arbitration for extended amounts of time. (This gets even worst when you consider elderly people or those in a care crisis situation, may have shorter timelines to do battle with their insurance company.)
- Rate increases over time can become prohibitive in the face of shifting from an active working income, to a lesser retirement income.
- You have to plan ahead (and get it in writing within your policy) for daily care cost increases over the years. (What you pay to insure today, may not be enough in 30 years.)
Long-Term Care 101, the Basics
Common Sense Long-Term Care Insurance Tips
Guidelines for Your Insurance Policy
- Don't spend more than 7% of your income for premiums
- Don't buy a policy unless you can afford to pay an increase of 10 to 20% on the policy
The Policy Fine Print
Know that the policy you purchase is the one you will be living with should long-term care become an issue for you. So, know what your policy says. Make sure the policy has a flexible feel to it, leaving room for a variety of care concerns later down the road. No one knows what will cause an issue in the future, so keeping a broad, but reasonable language within the coverage is very important. (The broader language feature will cost more for obvious reasons, but you will be glad for it should an unexpected care need impact your life.)
Save Big Money!
Taking Notes Can Save Big Bucks Later
I was told recently that when you are disusing your policy, you should make notes about the things discussed in the meeting. Any questions that you get answered, future features of the policy, cost of care increase information, and any issue that you and your agent talk about. Make copies of these notes (dated) and file one copy with your final policy, put a copy in your safety deposit box, and leave one with your agent. This can aid in any future discrepancies that may pop up. Getting some insurance companies to pay-out can prove difficult when you are too weak to fight, leaving your notes to do the fighting for you.
Buy When The Time is Right For You
Most of the time we think we must buy coverage when we are young. This may not be the best way to deal with long-term coverage. Unless you know a particular illnesses runs in your family, waiting until you are in your late 50s to buy such coverage can help you save some money. You should still qualify easily, and you may know some things that you didn't know 20 years ago about costs, as well as needs. Know that most insurance representatives are going to want you to buy early in life, so weigh your reasons carefully in the face of such convincing recommendations.
Long-Term Care Insurance Resources
- How to Buy Long-term Care Insurance
- AARP Long-Term Care Calculator
- Medicare (.gov) Long-Term Care Programs
Long-Term Care Conclusion
When you are ready to find the right policy to cover your long-term care needs, be sure to think about some of things mentioned here, and to use the three resource links provided. No one wants to; pay too much for; not have enough of; or buy the wrong type of long-term care coverage. With a little time and knowledge you can be sure you are making the right choice for your future care needs.
Comments for "Long-Term Care Insurance Policy Tips"
Maria Castor Handley from Jacksonville, California on January 14, 2014:
So this is basically everyone needs before buying a long term care insurance. As far as I am concerned, all questions that a buyer needs to ask was placed here...and answered. This post is nice!
India Arnold (author) from Northern, California on August 08, 2012:
Many people find out way too late they are not covered for nursing home care! Even when they have (what they believed to be) full medical coverage. Like you say, CC, doing a little research now can save someone from huge fiduciary damage later! Thank you for sharing your thoughts on Long-term Care Insurance.
Cynthia Calhoun from Western NC on May 31, 2012:
Good info. My mom runs a nursing home and it's surprising how many patients had long-term care coverage, only to discover startling loopholes later on. It pays to know and it pays to do your research. Great hub and many votes! :)
Simone Haruko Smith from San Francisco on May 29, 2012:
I had never heard of this type of insurance before. Most interesting!
Teresa Coppens from Ontario, Canada on May 27, 2012:
This information is pertinent in Canada as well. It is something my agent and I have talked about but you have given me more information to properly evaluate my needs. Thanks Indie!
Marlene Bertrand from USA on May 26, 2012:
You have provided a lot of information for someone like me (late 50's) to consider. In fact, I wasn't even considering it until I read your hub. Thanks K9keystrokes! :) I guess I kind of hoped the big standbys - Medicare and Medicaid would be the solution, but I can see that I should not rely on them at all. Thank you for your information. By the way, the resourses are exactly what I need to get started. Great hub.