Many people don't want to think that they may someday need long-term care and they don't plan for it. Others assume, incorrectly, that Medicare or their health insurance policies will cover the costs. But every year, this failure to plan for the future costs thousands of American families their life savings. The best time to plan for long-term care is before it becomes necessary.
Long-term-care insurance is an option for people who qualify medically and who can afford the premiums. Because premiums are based on your age at the time of purchase, the younger you are when you purchase a policy, the less expensive the annual premium. Some experts recommend buying the insurance at age 65 if you have significant assets you want to protect, and if you can afford an annual premium of around $1,500. Long-term care insurance isn't suitable for people with few assets who can expect Medicaid to cover a nursing-home stay, or for individuals who might have to sacrifice more immediate needs to pay the high premiums.
Before purchasing LTC Insurance consider these major factors:
There are also optional features that may be included in your plan, all of which will increase your annual premium:
Some experts recommend that you start by selecting an excellent company; look at their top plan, then eliminate those features you don't need. Call your state insurance department and ask about the company and its record. Check with insurance rating services to make sure the company you're considering is financially secure. You can find these rating services online, or you may call Moody's at 212-553-0300, or A.M. Best at 908-439-2200.
Keep in mind you won't get better pricing without increased risk or reduced benefits. If you're quoted a much lower price, it may be that the plan is from a "substandard" company, or the company is using "first lowball, then raise rates" tactics, or it simply provides less coverage.
Before you purchase any policy, review the details and options. Don't rely on the marketing materials or outline of coverage. Make sure you understand all the provisions. Ask your insurance agent questions. Contact the Area Agency on Aging, or local senior centers. Don't allow yourself to be pressured into making a quick decision. And remember: never pay cash.
After purchasing a policy, you usually have 30 days to review it. You may cancel the policy for a full refund during this time. For a detailed list of things to consider in selecting a policy, see Getcare's Long-term Care Insurance Checklist.
Contact your local State office if you have questions or would like to talk with someone in person about your situation. Guam GetCare staff are available to help you.
Use this checklist to evaluate and compare long-term care insurance.