When in the midst of long term care planning, one of the most difficult decisions is deciding whether to buy Long Term Care Insurance and which product to buy.
Many consumers face the facts that coverage can be expensive and rates have the potential to rise in the future. Others find they’re grateful they had the coverage and had more options in choosing their own care setting instead of relying on Medicaid facilities in their state. Having LTC coverage also meant they didn’t need to dip into their savings and investments and protected their children and grandchildren’s inheritance.
When deciding to buy long term care insurance, the following are a few tips to consider.
1. Do You Have Assets to Protect and Income to Pay for It?
Long Term Care insurance (LTCI) can be expensive. The basic rule when deciding to buy LTCI is, do you have enough savings and income to pay for coverage, but not so much that you could easily self-insure?
If you’re single with a net worth of $500,000 to $1.5 million, or a couple with a net worth of $1 million but less than $3 million, you’re a great candidate for LTCI. If your net worth is above these amounts, you may decide to invest in coverage to avoid dipping into your savings.
Basically, if you can afford to pay the premiums without affecting your lifestyle or savings, then LTCI is a good buy.
2. How Would a Long Term Care Event Affect Your Family?
What happens if your spouse needs care? Would you use your savings to pay for their care or exhaust yourself caring for your spouse instead?
By putting yourself in the position of facing these decisions, think about which scenario would make you feel worse.
- Paying premiums now and facing the risk of not using your coverage
- Paying full price for care knowing insurance could have paid for it
3. Work with an LTCI Specialist
If you think insurance can be difficult to understand, LTCI is one of the most complicated insurances on the market. Each policy can offer varying benefit levels and options to add beneficial options which could make your life easier at claim time. In addition, hybrid products may offer additional value based on your current situation.
An LTCI Specialist can help you navigate the murky waters of long term care coverage and find the best product with the right insurance carrier to fit your needs and budget.
4. Do Your Homework
While meeting with an LTC expert is essential, so is doing your own research.
Review the Top 5 Questions about Long Term Care Insurance, the AALTCI 3-Step Guide for Smarter Long Term Care Planning, the NAIC Shopper’s Guide to LTCI, and What to Expect During Underwriting for more information.
Still wondering if now is the right time for you to buy LTCI? Get an instant LTCI quote from the top insurance carriers and speak with an LTCI Specialist to learn more about your options.
LTC Consumer is an independent, free online service to help consumers understand what long term care insurance is, how it works, and how to evaluate coverage options. Our mission is to provide an educational, no-pressure resource for learning about long term care planning, with the opportunity to speak with specialists who can help them.