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I looked into it and decided against it. I am suspicious of these products and what if the companies go under? Also might not use it. My mom is 83 and still lives alone and manages. Most people around here get live in help temporarily or hire someone to do work for them several days a week. If they get that bad and need to go to a nursing home, they do the spend down.
Just a quick comment. My husband and I purchased long term care insurance about 10 years ago; we are now in our early 70's. This past year my husband became unexpectedly ill and requires assisted living; he will soon need skilled nursing. He is currently in an assisted living facility costing over $7,000 a month. Our long term are insurance pays for $4,500 of this.
Just a quick comment. My husband and I purchased long term care insurance about 10 years ago; we are now in our early 70's. This past year my husband became unexpectedly ill and requires assisted living; he will soon need skilled nursing. He is currently in an assisted living facility costing over $7,000 a month. Our long term are insurance pays for $4,500 of this.
While the circumstances are unfortunate, it's good to hear that your LTC policy is actually paying off. At $50K per year payout, I suspect that all the premiums you paid over the last 10 years have already be recouped.
We bought LTC with inflation protection about 3-years ago. With premiums in the $4500 per year range (vs yearly Assisted living costs at $45K+ or Nursing Home costs of $75K+, it won't take long to pay off all of our premiums ... in the event the insurance is needed. If we don't actually need or use the insurance, we still have more peace of mind than simply 'hoping' we never face a catastrophic or long-term health care need.
The numbers for 'self-insurance' as an alternative to LTC premiums don't work... except for those who are extremely wealthy ... or those who 'have nothing to lose' ... and expect the government to pay for everything. But, isn't that pretty much the audience and reason for most types of insurance?
The insurance companies aren't bailing-out of LTC policies because the policies are so profitable for them, but, because they are paying-off for the policy holders. I suppose there is always a question of whether the company will pay off or increase their premiums, but, strong, reliable companies are going to be there. While I don't like the potential downside, I still believe LTC insurance is one of the best investments retirees can make.
While the circumstances are unfortunate, it's good to hear that your LTC policy is actually paying off. At $50K per year payout, I suspect that all the premiums you paid over the last 10 years have already be recouped.
We bought LTC with inflation protection about 3-years ago. With premiums in the $4500 per year range (vs yearly Assisted living costs at $45K+ or Nursing Home costs of $75K+, it won't take long to pay off all of our premiums ... in the event the insurance is needed. If we don't actually need or use the insurance, we still have more peace of mind than simply 'hoping' we never face a catastrophic or long-term health care need.
The numbers for 'self-insurance' as an alternative to LTC premiums don't work... except for those who are extremely wealthy ... or those who 'have nothing to lose' ... and expect the government to pay for everything. But, isn't that pretty much the audience and reason for most types of insurance?
The insurance companies aren't bailing-out of LTC policies because the policies are so profitable for them, but, because they are paying-off for the policy holders. I suppose there is always a question of whether the company will pay off or increase their premiums, but, strong, reliable companies are going to be there. While I don't like the potential downside, I still believe LTC insurance is one of the best investments retirees can make.
There are a number of people that self insurance works for many...... Who aren't the very rich. For those that have it think pension+ SS + normal investment distribution and what do you come up with? Think about how that compares with the cost of a nursing home. Especially if each spouse has that and has assured that the surviving spouse will get their pension and a maxed out SS taken at age 70. Lots of folks in that situation. Want to be even more prepared? Add LTC on top of all of that and a paid for house.
My husband and I both have this. We pay about $110 per month for it - we've had it about 8 years. (His mom had Alzheimers and we don't want that in our future but...just in case).
My sister and her husband have had it for 10 years. Her husband now has Parkinsons - stage 4 or 5 - and she has 2 or 3 caregivers each day. She could never do what is needed on her own. He is only 61. A year ago, he was still working; there has been such a decline.
Without the long term care, she could never do it. She is so thankful she has it.
Location: Los Angeles, but looking for my niche in ME, or OR
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That is definitely something I think about. I have no family nearby, and even if I did, I am too independent, have always been. One question though... At what age should one consider buying this kind of insurance? I imagine that in our 40's and 50's is a bit too early no?
That is definitely something I think about. I have no family nearby, and even if I did, I am too independent, have always been. One question though... At what age should one consider buying this kind of insurance? I imagine that in our 40's and 50's is a bit too early no?
I have seen a recommended age point a couple of times. You seem to be close to it. Was based on premium and amount of money paid in over a period of time. The insurance companies have actuarial tables or the equivalent of but I am not sure they are as exact a science as life insurance. The payout of life insurance is a fixed target but health care seems to be more of a moving target.
It stated that if you already have LTC insurance to get ready for a sticker shock. John Hancock wants to increase premiums for most customers by an average of 40%; another company is seeking an 18% increase on some policies and they expect others to do the same. Some companies are getting out of the LTC business. They did say most states have to approve the increases and some have caps on what they can increase each year.
One thing I found interesting was a study that was done. It showed that out of those who purchased a limited 3 year coverage only 8% of those actually exhausted the coverage.
They stated going from an unlimited policy to a 3 year policy could save you as much as 39%. Going from a 5 to 3 year could save 15%.
That makes sense to me to buy a limited policy if you can save a decent amount of money on your premiums. By the time you meet their criteria for paying benefits your condition is pretty severe. I would think most people in that condition would not live more than an additional 3 to 5 years. (average nursing home stay is 2-2-1/2 years)
Of course there are always exceptions to this but I think it is something to consider if you decide to purchase LTC.
It stated that if you already have LTC insurance to get ready for a sticker shock. John Hancock wants to increase premiums for most customers by an average of 40%; another company is seeking an 18% increase on some policies and they expect others to do the same. Some companies are getting out of the LTC business. They did say most states have to approve the increases and some have caps on what they can increase each year.
One thing I found interesting was a study that was done. It showed that out of those who purchased a limited 3 year coverage only 8% of those actually exhausted the coverage.
They stated going from an unlimited policy to a 3 year policy could save you as much as 39%. Going from a 5 to 3 year could save 15%.
That makes sense to me to buy a limited policy if you can save a decent amount of money on your premiums. By the time you meet their criteria for paying benefits your condition is pretty severe. I would think most people in that condition would not live more than an additional 3 to 5 years. (average nursing home stay is 2-2-1/2 years)
Of course there are always exceptions to this but I think it is something to consider if you decide to purchase LTC.
Buying via a group vs individual can make a major difference
I said a few words about long term care insurance in an April 2011 post. At that time most of the costs associated with my husband's care for a degenerative neurological condition were covered by his long term care insurance. This continued until he passed away about five months ago. There was never any hassle related to reimbursement. It provided me with peace of mind at a time when that was in short supply. I have LTC insurance for myself and am pleased that my children will not have the burden of paying for my care when it becomes necessary.
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Someone who is actually using their LTC policy
Long Term Care
