Best Age To Buy Long Term Care Insurance |TOP|
If you are ready to find out whether you can "health-qualify" for long-term care insurance (meaning meet the insurance company requirements) and to see what coverage costs start the process. Click here to complete our simple online questionnaire and be connected with an expert in your area there is never any obligation and the information is free.
best age to buy long term care insurance
Most consumers do not know they must "health qualify" for long-term care insurance. There is a saying, your money pays for long-term care insurance - but your health buys it. Your health is the single most important factor. What does age have to do with health?
As we age, our health changes. And once you reach your 50s it almost never gets better (even if you diet and exercise). If you are 50, chances are that you leave your doctor's office with some new prescription in hand. That drug may help you live a long life. But it's those changes in our health that can make it harder or even impossible for you to health qualify for long-term care insurance.
Each insurer establishes their own health requirements. If you have some conditions or take some medications (even common ones) you should speak with a long-term care insurance professional. You may want to request a quote (see above).
Your good health can help reduce the cost of long-term care insurance. Insurers offer discounts that you do not lose even when your heaslth changes.Here is the percentage of applicants who qualify (American Association for Long-Term Care Insurance 2010 Sourcebook)
Let's Look At A Real Cost Example: Why Waiting Doesn't PayBecause of health changes that take place most often after people reach their 50s, we advocate that long-term care planning start in your 50s. But there is another reason it doesn't pay to wait -- and that's because you'll pay more.
Long-term care insurance protection should grow to keep pace with rising costs. The one we are illustrating does. So, by age 65, the $172,600 benefit you bought at age 55 -- will have grown in benefit value to $276,000.
It almost never pays to wait. And, there is one more important point. While you are waiting, you are uninsured. If something happens causing you to need long-term care (such as an accident or an illness), you'll have to pay yourself. . And, while most people need long-term care in their 70s and 80s, some do need care in their 50s and 60s.
If you are ready to see what coverage costs start by learning simple ways to get the best long term care insurance costs. Take three minutes to read two guides published by the American Association for Long Term Care Insurance. They appeared in issues of Kiplinger's Personal Finance magazine but you can read them online. No sign-in is required.
If you are ready to compare long term care insurance costs click on this link and request no-obligation information from one of the American Association for Long-Term Care Insurance's designated LTCi specialists. There is no obligation for the information and it is (of course) provided free of charge.
Purchasing a long-term care insurance policy can be an effective way to protect against the often devastating costs of long-term care. In the right circumstances, a good long-term care insurance policy can help you avoid exhausting your life savings to cover needed long-term care services and maintain access to the widest variety of quality service options. It may also provide you with greater choices and help you avoid depending upon the financial assistance of family, friends or the MassHealth (Medicaid) program.
Even if you are medically eligible, long-term care insurance might not be affordable for you. If you are living on a limited or fixed income or if you must go without basic needs to afford the premiums, you certainly should not buy a policy. You must also consider whether you are going to be able to afford the premiums throughout your lifetime, since it is not unusual for a policyholder to pay premiums for more than twenty years before needing services.
You should also be clear about what assets you hope to protect by buying long-term care insurance. If you do not have significant assets, long-term care insurance may not be an appropriate purchase for you. Under the right circumstances, long-term care insurance could be the best way to protect your assets, including your home. Since long-term care insurance is a major financial commitment, before you buy any coverage, understand your options and look closely at your needs and resources.
Although prices vary, it is not unusual for a long-term care insurance policy to cost several thousand dollars in premiums per year. Your actual cost for long-term care insurance depends upon two key factors: (1) your age at time of purchase and (2) the type and amount of benefits you choose.
Long-term care policies can vary greatly from one insurer to the next. Policies may include benefits for care in a nursing home, care provided in an assisted living facility, home health care or personal care provided in your home, care in an adult day care center or an ever-expanding array of other services. Some may pay for family benefits, such as caregiver training, but most will not pay for services provided by family members.
You should determine what types of facilities are covered by any long-term care policy you are considering. If you buy a policy that limits its coverage to care provided in a nursing home, your insurer will probably not pay for services you receive at home.
The most flexible policies allow you to use your benefits to cover any necessary long-term care service in whatever setting you might eventually need. Although insurers may offer such policies, they usually are more expensive than policies that limit the types and settings of services that are covered under the policy.
New services and facilities are likely to develop between the time you buy a policy and the time you need long-term care. Your policy may or may not cover these. As noted above, all individual policies must contain an alternate care provision which cover unspecified alternate services if agreed to by you, your caregiver and your insurer. The alternate care provision does not entitle you to benefits for service not specified in your policy, but allows the flexibility for an insurer to pay for newly developed services that were not available when you first bought your plan. Group policies are not required to include this provision.
Most long-term care policies limit both the amount they will pay each day (daily maximum benefit) and over the life of the policy to a maximum number of days or dollars (lifetime maximum benefit). These limits depend on the choices you make when you first buy a policy.
Daily maximum benefit amounts also vary and usually do not cover the entire cost of a day of longterm care services. Ignoring the effects of inflation, if you choose nursing home benefits covering $130 per day and a nursing home charges $180 per day, you will pay $50 per day (approximately $18,000 per year) from your own resources. When deciding on the amount of daily coverage you need, you should know (1) how much long-term care services actually cost in your area and (2) how much you can comfortably pay out-of-pocket beyond what your policy covers.
Inflation protection is a costly but important policy feature. It maintains your level of coverage even as the cost of long-term care rises. To determine whether or not you should buy inflation protection, consider your ability to pay out-of-pocket costs ten or twenty years from now. A qualified advisor should be able to help you project your income and growth of assets over time. Unless your policy includes inflation protection, you could find that you have coverage for a much smaller percentage of your actual costs by the time you need benefits. Depending on your age and future health needs, you may hold a policy for 20 or more years before you need long-term care services. If nursing home inflation increases by 5% annually, nursing homes costing $180 per day would cost over $360 per day in 15 years.
The longer the elimination period or higher the deductible, the lower the premium you will pay. If you choose a policy with a long elimination period, you should be prepared to cover the entire cost of the long-term care services you need during that period. Individual policies offered in Massachusetts cannot have an elimination period of greater than 365 days. Although a policy with a 365-day elimination period may cost less, it may mean that you should expect to pay tens of thousands of dollars before you are entitled to any benefits. Also, if you need care for only a short time, your policy may never pay benefits.
Under federal tax laws, the portion of your medical expenses that exceeds 7.5% of your adjusted gross income may be deductible. If you have a tax-qualified long-term care policy, you may be able to add the premiums you pay for the policy to your other deductible medical expenses when Page 18 calculating your income taxes. Furthermore, benefits paid by a qualified long-term care insurance policy generally are not taxable as income. (The federal Internal Revenue Service has not yet determined whether benefits paid by a non-qualified plan might be taxable as income.)
Please note that it is not always to your advantage to choose a federally tax-qualified policy over one that is not federally tax-qualified. You may need to be more incapacitated to qualify for benefits in a federally tax-qualified policy. However, any benefits received under a non tax-qualified policy COULD be taxable as income. Also, depending on your finances, you might not be able to take advantage of the federal tax breaks. You should consult your personal tax advisor on these issues. Note: Most long-term care policies bought prior to January 1, 1997 are considered federally taxqualified even if they do not meet all of the standards required of policies sold after that date. In most cases, you do not need to buy a new policy to qualify for the tax advantages. 041b061a72
