Long Term Health Care
Dear Gil,
WHAT IS YOUR OPINION ON OBTAINING A LONG TERM HEALTH CARE INSURANCE AND
AT WHAT AGE IF YOU FEEL IT IS NECESSARY.
Signed,
Barbara
Dear Barbara,
That's an excellent question. Long term health care has been growing
more and more popular over the last decade. However, this growing
popularity has come more from the insurance agents selling these
policies than from the success of the policies themselves. It will be
up to you to weigh the options, but here are some interesting things
to consider.
In my opinion, it may be best to obtain such a policy as close to
retirement age as possible. While many agents will suggest that you
buy the premium while you're young to keep the cost low, the reality
is that the insurers will increase the premium amount if they have to
keep up with the cost of claims. In some cases, that has meant
increasing the premium by 800%. Because of that, the argument to buy
early may be a weak one. In addition, a review of some insurers have
shown weak financials and some analysts have become concerned about
whether these companies will even be around by the time you'll need
them so make sure you select a company with a strong credit rating of
B+ or higher (this can be obtained by Moody's, Standard & Poors, or
other credit rating agencies)
Depending on your health and plans for retirement and living
arrangements, you may not need long term care insurance. A great
majority of people that purchase long-term care policies do so to
hedge the costs of being in nursing home after retirement. If you own
your home, free and clear, you can plan for at-home care, if
necessary. It will be much less expensive.
In addition, qualifying for benefits means, in most cases, that you
must not be able to perform "activities of daily living" including
bathing, dressing, eating, getting from a bed to a chair, remaining
continent, using a toilet, and walking. If this isn't your case, you
may not be allowed benefits. It is also important to remember that
there are deductibles that require your paying a certain number of
days (the lower the number of days, the higher the premium) for a care
facility out of pocket.
There are many things to consider in purchasing a policy. I've only
touched on a few, but they alone may be enough to cause you to
seriously consider whether or not you need long-term care insurance
and/or when and from whom to buy it.
WHAT IS YOUR OPINION ON OBTAINING A LONG TERM HEALTH CARE INSURANCE AND
AT WHAT AGE IF YOU FEEL IT IS NECESSARY.
Signed,
Barbara
Dear Barbara,
That's an excellent question. Long term health care has been growing
more and more popular over the last decade. However, this growing
popularity has come more from the insurance agents selling these
policies than from the success of the policies themselves. It will be
up to you to weigh the options, but here are some interesting things
to consider.
In my opinion, it may be best to obtain such a policy as close to
retirement age as possible. While many agents will suggest that you
buy the premium while you're young to keep the cost low, the reality
is that the insurers will increase the premium amount if they have to
keep up with the cost of claims. In some cases, that has meant
increasing the premium by 800%. Because of that, the argument to buy
early may be a weak one. In addition, a review of some insurers have
shown weak financials and some analysts have become concerned about
whether these companies will even be around by the time you'll need
them so make sure you select a company with a strong credit rating of
B+ or higher (this can be obtained by Moody's, Standard & Poors, or
other credit rating agencies)
Depending on your health and plans for retirement and living
arrangements, you may not need long term care insurance. A great
majority of people that purchase long-term care policies do so to
hedge the costs of being in nursing home after retirement. If you own
your home, free and clear, you can plan for at-home care, if
necessary. It will be much less expensive.
In addition, qualifying for benefits means, in most cases, that you
must not be able to perform "activities of daily living" including
bathing, dressing, eating, getting from a bed to a chair, remaining
continent, using a toilet, and walking. If this isn't your case, you
may not be allowed benefits. It is also important to remember that
there are deductibles that require your paying a certain number of
days (the lower the number of days, the higher the premium) for a care
facility out of pocket.
There are many things to consider in purchasing a policy. I've only
touched on a few, but they alone may be enough to cause you to
seriously consider whether or not you need long-term care insurance
and/or when and from whom to buy it.