How to Choose a Secure Long Term Care Insurance Policy

Nobody wants to be a burden to others or to the state after they retire, and most choose to protect themselves against it by focusing on their pension plans. Long term care insurance is a niche protection that targets expenses related to care facilities such as nursing homes. It offers a crucial umbrella, given that 70% of retirees require this kind of care eventually. Extended lifespans only make this issue more pertinent. 

Long term care fees typically increase by about 5% annually, although some nursing homes have featured in the press for exorbitant inflation rates of up to 100% in a single year. While such cases are rare, insuring for long term care should take more reasonable inflation rates into account. Quotations typically include ordinary inflation protection, but some choose to exclude it from their policies as a way of saving pennies. Assisted living costs just over $36,000 a year and is not covered by Medicare. While the government does cover medical expenses through Medicare, it does not allow for custodial costs. When choosing long term care insurance, there is a range of ways to tailor your plan to your benefit. 


Start with a Specialist

Because long term care insurance is such a specialized field, an LTCi specialist is the best person to obtain advice from, according to Forbes. General brokers can competently handle a range of other policies, but when it comes to long term care, a specialist can inform you about inflation, the quality of care you are likely to get in your price range, and how to work your LTCi into your health insurance and retirement fund effectively. 

Elimination Period

An elimination period is better understood as a deductible. Ideally, there should be no need to wait for even a short period before you receive the care you need from your policy. When ill or unable to take care of yourself, even a short elimination period of three months is far too long and is likely to be unmanageable.

Assessing Insurers

It is particularly important that Long-term Care Insurance providers be operational and financially stable over the long term, since care may be required decades after you begin paying for coverage. Look for insurers that have been in the business for at least three years, and look into whether they have been involved in class action cases or bad faith lawsuits. 

Consider Care Givers

Some people prefer to use professional care support because it makes them feel more independent, while others would like their families to help instead. Some policies are flexible enough to allow for spousal or familial in-house care, while others are not. If you prefer family care, look for a provider that will pay for that care. 

Payout Periods

Maximum benefit and lifetime policies are more expensive than those covering five years. It is possible to buy coverage for less, but it is best not to cover less than three years.


Image credits: David Castillo