Sal Sofia LUTCF No Comments

What Long Term Care Insurance Policy would be best?

Why shouldn’t I buy a long term care policy?  After all I’ve seen the devastating effects, financial and emotion toll Alzheimer’s disease reeks upon a family or a caretaker (a spouse, children).

There is no way to be fully prepared to face the consequences and drastic life changing responsibilities we may need to face.  I’ve heard so many people before me warn of this happening and to get prepared.  But how do we get prepared for such an immense responsibility and financial expense that would wipe practically anyone out?

By the way it need not be Alzheimer’s but can be a stroke, cancer, other brain disorders of paraplegia that can send someone in need of lifelong care.

The costs of care provided an ill person who needs 24 hour attention are more than the average person earns in a year.  With care facilities (adult center, assisted living, alternate care, memory care facilities) costing from $3,000 to $10,000 per month, how could anyone tackle that kind of expense?  Where would the money come from to take care of your loved one?  Even the cost for a home health agency to conduct home visitation or 24 hour care at home is considered a long-term care expense.

I assume you would need to provide care to a loved one (even yourself), right?  I also know that as a society we have one option (which is not an option for most) that is to declare oneself financially indigent.  To spend down assets to a point of qualification for Medicaid, but do we really want to do this?  It could be fraught with entanglement and needing to clear oneself of wrong-doing by suggesting there wasn’t money available when there really was in the eyes of the government.  This would become a legal nightmare on top of the nightmare we are in already.

How do we then financially prepare ourselves for THE DAY it happens?

What is needed MOST?

WHO will provide the money for the care?

I bet some are thinking that there is a type of insurance policy that will help pay or pay in full the costs and expenses of quality care.  Even bad quality care needs to be paid for but that’s an entirely different concern.  I’ve been hearing a lot about Long Term Care Insurance policies and even know many older people that have these policies.  Some have been paying for many years without ever needing it, others have used it and others still have dropped them.  Why would anyone EVER drop their need for protection of this critical magnitude?  I found out the answer: The cost it requires to continue to pay for it as the premiums continue to RISE AND the plan benefit reduces as a factor of not being to meet the policy’s full premium AND the fact that a person has been paying for many years and figures it won’t happen to them since it hasn’t up to now,  so why pay into something where there is absolutely NO RETURN of any money to them if the policy isn’t ever utilized?   I can’t seem to disagree at some of those reasonable feelings.

The Long Term Care insurance industry has done a poor in many ways.  Some are noted here:

  1. they initially priced their products too low and could not recover except to raise premiums on their current customers
  2. they never fully anticipated the extreme acceleration of costs it would require to provide care
  3. they created the supply without the full demand for their product at the time
  4. they failed to tell an accurate story of how their policy’s could be used since the marketplace was continuing to change very rapidly
  5. they failed to protect the very people they insured by going to them with increasing premiums
  6. companies left the business and caused even more confusion and negative feelings upon their customers and the care industry

Out of all these however the one that is most concerning is the INCREASING PREMIUMS as the insured gets older and probably will at some point no longer have enough money to pay for it and so will drop their policy!

WHAT IS THE SOLUTION?  What is the best form of financial protection we could have that would provide enough money (that could last a lifetime), that once purchased would NOT INCREASE in cost, and that is easier to understand its uses and provide the best peace of mind now and into the future?

I found it!  It’s LIVING BENEFITS Insurance.  An insurance policy that provides for the purchase of a dollar amount of money that can be used for long term care related expenses and also for many other life changing critical illnesses and major health crisis conditions, in addition a final expense payment to beneficiaries.  Cash payments paid to you for diagnosis of Cancer, Heart Attack, Stroke and up to 15 additional medical illnesses or injuries in addition to payments made to you for Long-Term Care costs you made need in your lifetime.

In my next blog, I’ll discuss these new policy types in more detail.   Stay tuned!

For a quick and easy online quote check out our insurance quote page.

Everyone’s needs are different. Let me know if I can answer any questions.