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Frequently Asked Questions |
Why should I buy long term care insurance?Typically, the majority of people will reach a point in their lives where they are no longer able to take care of themselves. It may be from an illness such as Alzheimer's or Cancer or maybe from an accident such as a car wreck or even falling off a horse like Christopher Reeves. With modern medicine keeping people alive longer and that raises the risk of needing long term care before you die. Some studies have shown Americans over the age of 65 faces a 45% risk of spending time in a nursing home. A year in a nursing home now averages more than $60,000 in 2007 and can exceed $200,000 annually in some areas of the country especially in the Northeastern US.
Is long-term care insurance a "bad or a good investment?"My Mom purchased her policy at 47 with premiums less than $1,000/yr. Six years later she went on claim because of a failed knee replacement surgery. Assuming she lives until her life expectancy (not uncommon joint replacements), and my policy pays its maximum benefit schedule, here's the final tabulation:
- She will have paid less than $6,000 in premium and received more than $1,190,000 in covered expenses.
What is the average daily benefit that most choose?The average rate that most choose is based on the area of the country they live in. That can range from $100 per day up to $250 a day. It is important you consider the cost in your area before deciding on your long term care insurance benefits.
What is the average annual assisted living facility cost?Assisted living facilities are a bit less than nursing homes but since the Baby-Boomers have begun to retire the cost has begun to rise because Assisted living facilities are preferred over Nursing Homes typically.
What is the best long term insurance company?When choosing a long term care insurance company, there are a few important factors that you should consider.
- The first is the financial stability of the company. You might not use your policy for 20-30 years and you want to make sure your long term care insurance company will be around to pay your claims in the future.
- Consider the company's rate increase history. Long Term Care Insurance companies have the right to raise premiums at anytime if they are approved by your State's Insurance Commissioner but there are plenty of A+ companies that have never raised rates. Be sure to research the premium rate history of the company before going with them and be wary of companies whose policies are far below their competition.
- The third and maybe most important factor are the claims paying history of the company. Check with your agent to see what the claims paying rate is. Genworth Financial, John Hancock, MetLife, Mass Mutual, Prudential are all companies that should be on your shot list.
What are Activities of Daily Living (ADLs)?These activities are the things we all take for granted every day until we can't do them. Most long term care insurance companies require you to need help with 2 out of 6 to trigger a claim. They are:
- Eating
- Bathing
- Dressing
- Toileting
- Transferring
- Maintaining your Continence
How is long term care considered by the IRS?Long Term Care Insurance is a tax deductible expense in many situations. Check with you tax professionals or Turbo-Tax. More about Tax Deductibility of Long Term Care Insurance ...
Are long term care insurance expenses deductible?According to the current 2007 tax code, for people who itemize tax deductions, medical expenses are deductible if they exceed 7.5% of adjusted gross income. For an individual, the portion of the Long Term Care insurance premium that is deductible is determined by the age of the insured. In some cases if you itemize your taxes you may be able to deduct the premium.
How are benefits from the policy treated by the IRS?For individuals, long term care insurance benefits are generally not taxable.
Why choose long term care insurance over depending on Medicaid or other government assistance?In short, long term care insurance will prevent you from having to spend down your assets to qualify for Medicaid. Some States like NY, CA are partnership States and that means if you have a Partnership Long Term Care Policy if you use all you policy you can get government assistance without having to spend down your assets.
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Last Updated ( Sunday, 17 May 2009 )
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A review of each company's financial stability ratings, claims experience, and size.
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A thorough, side-by-side comparison of each company's policy features.
We cover the similarities and the differences. -
Price comparisons customized to suit your specific needs from top carriers such as MetLife, Genworth, New York Life, MassMutual, Mutual of Omaha, Prudential Financial, and more.
Carriers quoted will depend on your state. Completing this form does not bind you to any insurance policy. » Click here to get quotes.
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