Understanding Affordable Long-Term Care Insurance

Who Needs It

With the advances in medical science, we all are living longer. People require long-term care due to illness, accidents or the impact of aging. The US Department of Health and Human Services says if you reach the age of 65 you have a 70% chance of needing some type of long-term care service before you pass. Family history only has a limited impact on your risk, however, there are certain conditions like Alzheimer’s disease, for example, that tend to run in families. With longevity increasing the risk of you needing help with activities of daily living or supervision due to cognitive problems has increased. The cost of care is high, the solution is easy and affordable.

If you are saving for a future retirement or you need to protect your current retirement assets, affordable Long-Term Care Insurance could be for you. If you are wealthy ($5 million plus) you might think you can self-insure. However, protecting your portfolio is very important and you can’t time your need for care with the market. Wealthy or not, the burden is still tremendous.  An affordable long-term care plan will ease the burden on your loved ones and provide tax-free benefits. If you are poor your state’s Medicaid program might be the best option. For everyone else a long-term care plan is essential to a successful retirement as it will safeguard your 401(k) IRA 403(b) and other savings in addition to easing the family burden. Partnership plans, available in most states, provide additional “dollar-for-dollar” asset protection.   

Most people who plan are ages 40 to 70. Options are available for younger and older individuals. Policies are medically underwritten but each company has its own guidelines. Generally, the younger and healthier you are gives you the most affordable options for you to consider.

Why They Need It

The financial costs and burdens of aging will impact you, your family, your savings and your lifestyle. A successful future or current retirement should include a plan to safeguard your assets and ease the burden long-term care places on family. The consequences are tremendous but affordable LTC insurance will add peace-of-mind. There are a number of different planning options which will fit your goals and budget. These include:

  • Traditional plans (including partnership plans in available states with additional asset protection and shared benefit plans with a spouse/partner).
  • Asset-based plans known as “hybrid” options. These are life insurance or annuities with long-term care riders and death benefits/ Both single premium or limited premium or annual premium options available.
  • The short-term plan which provides a more limited benefit but more relaxed underwriting and age requirements.   

Without a plan, the burden of caregiving is placed on a spouse or family member, usually a daughter or daughter-in-law. For a spouse, it may be very difficult to be a full-time caregiver as they may be older themselves. Being a caregiver can also impact their health and well-being as well. For adult children, they will have their own jobs and families. Men are not usually the best at caregiving and it is very hard for a daughter or daughter-in-law to be a spouse, a mom, have a career and be a caregiver. A Long-Term Care policy will generally provide case management which will help the family be family.

Many people want to have a choice in the type of care settings and caregivers. Quality care is a major concern for most people. Affordable LTC insurance will provide the resources for quality care at home, adult daycare, assisted living, memory care and nursing home. You and your family get to decide how you use your benefits once you qualify for the benefits. The trigger for receiving benefits is easy and surveys suggest the vast majority of claimants are very satisfied with the process.  

Many people want to protect their lifestyle and that of a spouse/partner. Others want to make sure their children and grandchildren will inherit their assets and protect them from the Medicaid spend-down.

Finally, most people enjoy the peace-of-mind knowing this burden will not be placed on a spouse/partner, adult child or in-law or other family members. Since the solution is easy and affordable more and more people plan in advance as part of their retirement planning so they know their assets are protected and their families will not be burdened by the emotional and physical impact of being a caregiver.

How You Can Get It

There are many insurance agents and financial advisors who could give you a “quote”. However, there are very few specialists that have the knowledge and expertise in underwriting, policy features and benefits, tax incentives, knowledge of state partnership programs, and claims experience. Very few people are endorsed by the American Association for Long-Term Care Insurance. You have come to the right place.

You must have fairly good health in order to be eligible to get a policy. This varies from company to company. It also varies depending on the type of plan (traditional, hybrid or short-term). We first start by asking a number of detailed health and financial questions to determine eligibility and suitability. If appropriate we would set up a quick meeting using our unique screen sharing technology. You will see my computer screen although I won’t see you. This way I can ask questions and explain how the policies work including partnership information, tax incentives and more. You will be able to ask questions as well. This way I can make appropriate recommendations based on your specific situation so you have something to think about.

The idea is to find an affordable plan to address the consequences of long-term care. Since we work with all the top companies we will be able to shop for the best coverage at the best value.

If you like one of the options you must apply to see if you can get approved. This is easy since most companies have electronic applications. The underwriting can take up to 6 weeks to complete. Often, they will include a telephone interview. Depending on your age this interview could be in person. They will not draw blood or take urine unless you have not been to a doctor in a very long time.

Once approved your policy will be mailed to you. We will set a time to review your benefits and make any changes if any. If you get declined we will find alternative options depending on the reasons for the decline.

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