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Long Term Care Insurance is private insurance designed to help pay for nursing home or home health care expenses. It is available to individuals and may be available under a group policy. You pay a premium to an insurer in return for protection against the high costs of long-term care. Long-Term Care can be expensive; especially for retirees living on a fixed budget. The sobering reality is that one-in-three Long-Term Care policy holders will wind up using their Long-Term Care policy at some point in their retirement.
At least 70% of people over 65 will require long term care services at some point in their lives acording to National Clearing House for Long Term Care Information (a service developed by the U.S. Department of Health and Human Services). It is estimated that at least 10 million Americans are currently in need of long term care services and support and this figure is projected to increase to 15 million by 2020.
Click this link to give you the information to assess your need for long-term care, calculate the costs, and see if a long-term care policy will be right for you. http://freeseniorcitizenssolutions.com/long-term-care.html. If you're considering buying a long-term care policy, be sure to do your homework first.
A long-term policy is supposed to pay for in-home, assisted living or nursing home care. Typically, benefits will be triggered by diminished mental ability, as with Alzheimer's, or if you can't perform activities of daily living: walking, dressing, bathing or eating, for instance. Many insurers spell out a list of activities; you must be unable to do a certain number of them for benefits to kick in.
The cost of premiums depends on the insurer, as well as the policy's provisions. Some provisions will affect your price more than others. They're listed here in rough order of their impact:
Age. A married 55-year-old person in good health will pay an average annual premium of $1,027 for a policy with benefits of up to $150 a day for three years, according to the American Association for Long-Term Care Insurance. When you turn 65, the premium jumps to $1,939. (Most policies are unisex). Typically, you can't get a long-term policy after age 79.
- Daily benefit. A policy that pays $100 a day costs less than one that pays $200 a day.
- Length of benefit. You can buy policies that pay for one year, three years — or as long as you need them. The longer the benefit, the more you pay.
- Waiting period. A policy that kicks in as soon as you need it will cost more than one that won't start until you've paid for 30, 60 or 90 days of long-term care yourself.
- Health. If you're in good health, you can often get a discount. If you're not, you may not be able to get long-term insurance at all.
- Features. Many policies offer an inflation feature; your benefits will be adjusted up for inflation every year. Typically, a policy whose inflation feature is linked to the consumer price index is cheaper than one that awards a flat 5% inflation boost to benefits each year. If you're worried about cost, opt for a policy that pays out for three years. The odds are good you won't need more than three years. A recent study found that just 8% of claimants with three-year payout policies exhausted their benefits, says the long-term care association.
Similarly, you might opt for lower daily payouts. That's because you might be able to count on Social Security, or your own savings, to make up the gap.
Your choice of coverage should depend on a variety of factors, says Joseph Matthews, author of Long-term Care: How to Plan and Pay for It. If Alzheimer's runs in your family, consider opting for unlimited benefits. |