How likely is it that you, or someone in your household—such as an elderly parent—may need long-term care? According to the U.S. Department of Health and Human Services (HHS), roughly 70% of Americans aged 65 and older will need some form of long-term care. How are you going to pay for these services? An insurance policy for long-term care is a practical solution. Long-term care insurance can help you reduce the risk that your savings over a lifetime will be depleted by long-term costs. Be aware, however, that this insurance type has some downsides.
The ABCs of LTC Insurance
The majority of LTC policies work like other types of insurance you are familiar with, such as auto or homeowners insurance. The terms of the policy determine how much you will receive in benefits on a monthly or daily basis, up to an agreed lifetime maximum. The type of care provided (for example, at home or in a nursing facility) will determine the amount you receive. Over time, you may be able to add more coverage to your policy.
You’ll typically have to wait between 30 and 180 days to be eligible for any benefits. The norm is 90 days. The longer the waiting period, the more expensive it is. You can also expect to pay more if you choose policies that offer higher benefits.
LTC policies provide benefits if you are unable to perform certain basic daily activities, such as bathing, dressing up, eating, transferring, managing incontinence, or if your cognitive abilities have been impaired. As soon as you begin receiving benefits, the premiums stop. If you decide to stop paying for the policy, you will lose any future benefits. You should be aware that the coverage can be affected by a number of factors. You may not be eligible for coverage if you have a pre-existing condition.
The recent trends in Long-term care insurance are not encouraging. Insurance companies have either reduced benefits or raised premiums after underestimating the cost of nursing homes. In general, insurance policies are more expensive and harder to get. For those who have insurance, the premiums continue to rise, provided that their policy permits it.
Three Factors To Consider
You only have one shot to buy Long-term care insurance. If you decide to take the plunge, consider several factors, including:
Financial Situation: Can you afford to pay for your long-term care on your own, without compromising your overall financial situation? Look at your financial situation objectively.
Estate Planning Objectives: An LTC policy can be a good option if you want to preserve wealth for your family.
Health and Age: The cost of LTC premiums increases as you get older. You may also have to pay more for pre-existing conditions if you can secure coverage. You should apply for insurance as soon as you can and look for policies with more generous terms at a reasonable price.
You may be able to get coverage in other ways than buying a private policy. You may be eligible to join a group insurance plan offered by your employer or another affiliation. It is especially useful if your health condition would otherwise increase your premiums or prevent you from getting coverage.
Turn To Your Advisor
No one LTC policy fits all. Assess your needs with the help of a professional advisor like E-Policy Review and make an educated decision on which LTC policy is right for you.
Long-term care insurance is a vital financial tool that protects your family while helping you reach your financial goals. This insurance provides peace of mind for your loved ones and financial security. Choose the right type of insurance for your needs and budget.
If you are considering Long-term Care Insurance in Florida, visit E-Policy Review. We can assist you in selecting the best insurance policy for your family.