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You don't get moved into higher and higher risk groups. In fact, that's the whole point of purchasing LTC insurance when you're in your 50s and relatively healthy.
OK. but they can still greatly increase premiums over time until you are priced out and forced to cancel or else severely reduce the benefits provided and increase your waiting period before the benefits kick in.
Some people have had their premiums quadruple in just 2 years.
Rising costs could be prompting many seniors to drop their policies, according to a study from Boston College’s Center for Retirement Research. Published in October, it found that about a third of people with long-term care insurance at age 65 let their policies lapse, often just a short time before needing care. While some seniors had memory problems that kept them from paying their premiums, others dropped their policies because they believed they could no longer afford them, the researchers found.
This thread is being dominated by people who believe that most or all of us will be in LTC as an end of life experience and are willing to pay $20,000 a year for insurance.
Thought: if that were true then insurance companies would not offer said insurance. It would be a financial loss!
Are all of us are going to have a major stroke? Get dementia? The census guys found that less than 4% of folk over 65 live in nursing homes or have in home help. Sorry, but I am not going to spend my retirement savings on something that is unlikely to come to pass.
This thread is being dominated by people who believe that most or all of us will be in LTC as an end of life experience and are willing to pay $20,000 a year for insurance.
Thought: if that were true then insurance companies would not offer said insurance. It would be a financial loss!
Are all of us are going to have a major stroke? Get dementia? The census guys found that less than 4% of folk over 65 live in nursing homes or have in home help. Sorry, but I am not going to spend my retirement savings on something that is unlikely to come to pass.
A major factor is the birth rate. I don't have children. I don't have the option of the in-law suite. I need to have enough cash to outsource it if I degrade to the point where I can't fend for myself. My sister didn't have children either and faces the same issue.
It is interesting the logic that says I can't pay the premiums so I'll give up the insurance and pay cash for the care!
My LTCi premiums started just under $1,000 a year and I assumed rates would double every ten years. So $10,000 the first decade and $20,000 the second decade and $40,000 the third decade. That Only $70,000 over 30 years. A pack of smokes a day would cost a lot more than that! And you'd want to have you life savings pilfered away instead?
So when I'm $70,000 in I have a LIFETIME benefit that's paying over $200,000 a year AND I've been covered from day one!
This thread is being dominated by people who believe that most or all of us will be in LTC as an end of life experience and are willing to pay $20,000 a year for insurance.
Thought: if that were true then insurance companies would not offer said insurance. It would be a financial loss!
Are all of us are going to have a major stroke? Get dementia? The census guys found that less than 4% of folk over 65 live in nursing homes or have in home help. Sorry, but I am not going to spend my retirement savings on something that is unlikely to come to pass.
20k a year , where do you come up with that one unless you are really old .
i am 64 , my wife 66 , we live in one of the highest cost of care areas , need 400 a day and we net out around 1/3 that price for both of us and i was surcharged for being prediabetic .
that price also includes total asset and income protection if medicaid is needed .
it usually works out you will pay in about 1 years worth of care in premiums by the time odds are higher you will use it .
whatever data exists is on a generation that is 1/2 the amount of people with a whole lot more baby boomers that are going to live longer then any other generation prior . that data has yet to be compiled as baby boomers are still to young .
but as i said earlier , statistics mean nothing to us since we don't know who is on the bad side of the statistic and many of us will be .. for us humans we only have two outcomes , it is either us or it isn't .
Last edited by mathjak107; 07-13-2016 at 03:01 AM..
It is interesting the logic that says I can't pay the premiums so I'll give up the insurance and pay cash for the care!
My LTCi premiums started just under $1,000 a year and I assumed rates would double every ten years. So $10,000 the first decade and $20,000 the second decade and $40,000 the third decade. That Only $70,000 over 30 years. A pack of smokes a day would cost a lot more than that! And you'd want to have you life savings pilfered away instead?
So when I'm $70,000 in I have a LIFETIME benefit that's paying over $200,000 a year AND I've been covered from day one!
Your math is off; if it doubles every 10 years then the average for the first decade is $1500 (first year at $1000, last at $2000 and assuming an even rise across the other years), $3000 for the second and $6000 for the third, so your total would be $105,000 over 30 years. If it has a 90 day elimination, the historical data says only 35% of people will ever file a claim so the insurance company is doing okay on this. Even zero day elimination policies only have 50% usage. And most claims don't exhaust the policy.
Insurance is rarely a great deal. Every time I buy some I hope I am throwing my money away. Not all of us can afford to mitigate all risks though.
My father-in-law executed that plan. Blood and brain spatter everywhere in the kitchen of the family home that my wife owned a couple hours from where we lived where her father had lifetime tenancy. My wife found the body. My marriage didn't survive that event. She plunged into depression, wouldn't seek help, and moved back to that home. I can think of more family-friendly ways to commit suicide.
Sorry, Geoff - that's horrible...and horrible that it has to be considered as an option. But yes, we need a humane option for those who CHOOSE it - one that is good for the person AND for the ones they leave behind.
There's a big difference between some of the living options that were mentioned. For instance, the people who need a "SNF" are very different from those in assisted living. Assisted living is for those who are basically in good health and self sufficient EXCEPT they cannot drive or maintain a property anymore. People who go to assisted living--in many cases--do not really need to go, and could easily save the money if their family ponies up to help them. They might need only a smidgeon of help to stay in their own homes--such as taking them grocery shopping, to doctor appointments, mowing their grass or whatever needs to be done. In MOST cases, if these people have even a bit of help, they are FAR better staying in their own homes rather than going into assisted living. Assisted living is primarily for the rich or those with ample financial resources. Assisted living facilities offer new and luxurious apartments overlooking lakes or golf courses and 3 meals a day at several restaurants inside the facility, many offer swimming pools and other assorted activities. People who live on SS cannot afford assisted living and LTC insurance doesn't cover assisted living. These people are forced to go right into a nursing home which in some cases they don't need. If a son or daughter could just do a bare minimum to help these people, it would be preferable to a nursing home. Once a week grocery shopping is really all they need to do. They could get someone to mow the grass or shovel the snow. If there are multiple children or even older grandchildren available, they could all pitch in to help.
A "SNF" or skilled nursing facility is only for those who have semi-acute issues, generally post-hospitalizations, not necessarily long term. For instance, someone breaks a hip, winds up in a SNF for rehab, then recovers and goes back home. They might only be in the SNF for 2 weeks. Most of that is covered by Medicare.
Once a person needs a nursing home, though, they are often approaching the end of their lives. So why bother with LTC insurance? LTC insurance is to pay for a short period of nursing care which will enable them to protect their assets and then go back to their regular living situation. Elderly people in their 90's who are bedridden are NEVER going to "recover" and go back home. In this situation, LTC insurance isn't going to cover full time/long term nursing care. The only recourse at this point is to sell the person's home to pay for the nursing home. there isn't any other way around it. People's children don't like to hear that, but someone has to pay for the nursing home, LTC insurance isn't ENOUGH to cover it. My LTC insurance covers roughly 1/2 of the monthly cost of a nursing home or in-home nursing care, but only for short period of time. It's only meant to pay for unanticipated nursing care in order to get you back to your previous living situation. It's not meant to cover the cost of a nursing home for the rest of your life. It would be exorbitantly expensive to do that.
counting on family is not a great idea. typically what happens is one sibling steps up to the plate and the others do not or are struggling themselves financially .
then the fighting starts , especially if you are married . I bet there is not a person here that helped pay for their parents care and had a sibling that did not chip in and did not end up having fights with their spouse over it.
the old why am I working and giving money when your brothers and sisters don't do their share will start to crack the marriage
daisey2010, I agree with most of what you say. I would say the terms of LTCi vary from policy to policy and can be more generous than your example. It is a complex puzzle to solve because of the unknowns. As previously mentioned we are grappling with how to plan for or at least we were. This thread along with personal conversations ns has been very helpful. Other than possibly going on a waiting list we don't need to do anything. There are several ways to skin the cat and fortunately we have several options on track to deal with. It is helpful to listen and hear others. Reinforces we are blessed as are others in the forum.
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