Tips on Buying Long-Term Care Insurance

With healthcare costs rising at a progressively faster rate every year, insurance companies are becoming increasingly restrictive in the areas of both eligibility and coverage.  As we age, the goal for insurance should be to preserve hard earned assets and to reduce the potential dependence on loved ones and family members.  To this end we need to carefully evaluate the need for long-term care insurance, to forgo it could cost someone their entire life’s savings if they are not prepared to weather a prolonged requirement for care.  Typically health insurance coverage, including that of Medicare, does not normally cover long-term care expenses.  If you are down to your last several thousand dollars and have drained most of your savings and remaining assets, you may be eligible for Medicaid, a state insurance plan, otherwise you will have to navigate the complicated systems and cover the expenses on your own. 

Long-term care insurance helps cover the costs of a chronic illness or disability which extends beyond the length of a normal medical and nursing care stay.  Contributing to a long-term care plan will help insure that you are in control of the services you need and where and how you receive them if the need arises.  Many adults make the mistake of waiting until they reach their senior years to begin thinking about long-term care but by waiting until that time when one might actually need these services means a short span of premium payments from you to the insurer and an almost immediate payout of benefits on your behalf by the insurer.  Many companies will have age and health restrictions for new policyholders, therefore the likelihood that you will receive coverage is slim at best and if you are fortunate enough to get approval your premiums will be out of sight and quite possibly beyond your means.  The most advantageous time to look into buying a policy of long-term care insurance is when you’ve reached middle age as this is the time when you would likely be eligible for approval under a plan and it would make sense for you to begin incurring the expense of making the premium payments as you are approaching a period in life where you are likely to need the coverage. 

A policy of long-term care insurance should help you cover the following expenses: assisted living services, in home help, adult day care, visiting nurses and a stay in a nursing care facility.  Key considerations for you to evaluate when selecting a policy are: inflation protection so the policy keeps up with the astronomical rate of healthcare inflation, where you want your coverage to be effective (either at home or in a nursing home) the waiting period of the policy as far as how long it will take before it goes into effect, both the term or period of time you are eligible for benefits under the policy and if there is a maximum monthly or daily benefit paid out.  Some policies have an additional feature called a non-forfeiture clause meaning that for an additional premium your coverage never ends even due to non-payment of premiums.  Lastly and most importantly be sure to select an insurance provider who is on strong financial ground or risk not only losing all of your premium payments but winding up without coverage as well. 

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