A Sneaky Secret About Long-Term Care Insurance Premiums
July 13, 2009
Affordability is a key ingredient in any successful long-term care plan. Which is why the premium cost is often the most important elements to consumers who are considering the purchase of LTCI. One of the most common questions I hear is: ” Will my premiums ever increase? ” The answer is this: there are lots of scenarios in which LTCI premiums could increase. I will try to expound one in this article and follow up with the second in a future article. The first scenario involves a choice the policyholder makes regarding inflation protection. Most of the LTCI policies have automatic inflation protection built into the policy design from the very beginning; in such cases the premium is designed to stay level for the life of the policyholder. The benefits can increase each year, but the long term care insurance premium remains the same.
Inflation Protection: What You Need to Know
Some insurance carriers offer a different kind of inflation in which the policyholder starts out with no automatic inflation protection; instead, benefit increases would be offered every three years or so. These increases can usually be accepted or declined by the policyholder. This means that your premium would increase every three years for the rest of your life or until you start receiving policy benefits. The only problem with this inflation protection choice is that the policyholder is three years older when each offer of extra benefits is made. The expense of the added benefits is based on the later age, not on the age of the policyholder at the inception of the policy. This can result in a significant increase in premiums in later years. Some consumers simply drop these policies after a while, as they just can’t afford to continue paying long term care insurance premiums that are so much higher than the cost of the original premium.
Long-term Effects of Premium Increases
There are group policies that often offer this kind of inflation protection to stay competitive with individual LTCI policies. Before finalizing their decision, it is very important for consumers to understand the long-term effects that these premium increases can have. Unfortunately, there are lots of policyholders who did not understand the ramifications of this kind of inflation protection when they purchased their policy. Sometimes, they see themselves locked into a policy that is constantly increasing in price and have few options for switching to a more affordable LTCI product due to their age and/or home health care circumstances. It is actually true that automatic inflation protection increases that are built into the premium cost from the inception of the policy will initially be more expensive than a periodic increase offer. But in my opinion, in most circumstances, it is better to lock in your inflation protection costs at an early age, and know that your premiums will remain stable, than take the chance on an ever-increasing premium that may eventually be too much to afford.
Looking For Low-Cost Life Insurance Quotes Recommendations? Read This Article!
July 13, 2009
In fact, it is essential for you to comprehend the correct life insurance quotes in order you can be sure that you have the best insurance plan that you can afford. For this purpose you can go to the insurer’s website, or look for their brochures. But, in this case, it is highly suggested for you to call them personally.
In the case you think that you are not able to gather the correct and enough information, then the next step for you to make is to fix up a meeting with a licensed agent and clear up the things about whole life insurance quotes. As a matter of fact fixing a meeting does not make you bound to purchasing an insurance plan. It should be also mentioned that in the case you find a cheap term quotes, then it is essential for you make certain that the plan does not oblige you for any other plan.
It will be useful for you to find out that it is important for you to study the following points before you choose a life insurance plan.
Initially you need to take into consideration that there are various types of life insurance available in the market. The truth is that while they may have different names in different companies, but in general they hold the same concepts as a result you should not be puzzled by the different names. In order to make the best choice you need to go to different companies and put together a list in columns of each kind – for instance, all term life insurance in one column regardless of their names and all whole life plans in another – this is very useful for choosing whole life insurance.
Secondly you need to be knowledgeable about that there are three basic types of life insurance: whole, term and universal. Term life insurance will have no cash value and simply means that cannot take a loan against it. Whole life insurance provides you more profits than what you have paid. Universal life insurance builds up its cash value and allows you to take a loan against it.
The third valuable point for you to keep in mind is that one kind of a policy can be converted to other sort of a policy with respect to some of the deciding factors. It is crucial for you to bear in mind that in such cases, your health plays a main role. In order you can understand this better let’s have an example: another company is offering you a cheaper life insurance rate, but your health does not allow you to qualify for the same, so you have to stick to the present company.
Fourthly, you need to know about the detail that even in the case that term allows riders, if you need a rider to attach to your current term life insurance plan, do so. As a matter of fact that riders available involve spouse and child term riders and that consequently means that your family is protected as much as you are with a negligible increase in premium.
It will be useful for you to discover the fifth factor . So, in the case you think that you are into some risky job in which you are prone to occupational hazards then you can ease your tension by adding a “waiver of cost” rider. In other words it simply means that if at any time during the policy term, you get disabled, then all the costs of the policy would be paid by the company itself.
It is also crucial for you to make sure that you do not risk your future for saving a little money. As a matter of fact there might be a number of cheap term life insurance rates available in the market, but you need to comprehend that they might offer you a limited cover and benefit. That is the reason why you should not go for the price but you need to check whether the policy is fulfilling your needs or not.
The last but not least thing that must be taken into consideration is that you should never be fooled by companies, agents or plans that promise low-priced or very affordable life insurance quotes. Keep in mind that your life insurance plan must help you when some kind of need occurs so if the case is that it doesn’t meet your needs you should better to change the plan and start all over again.
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Individual LTCI V.s Group Plans: Which Is Better?
July 13, 2009
More and more companies are beginning to offer long-term care insurance (LTCI) to their employees as part of an overall health care benefits package. And because getting group medical insurance is usually one way of getting lower insurance rates, most people automatically assume that the same is true with LTCI policies. But in most cases, individual LTCI policies will be able to offer not only lower premiums, but also better benefits if they are examined in a true “apples to apples” comparison. Group LTCI can be a good answer for those who have severe health problems, as they may be able to qualify under the “simplified” underwriting procedures. The same lenient qualifications also drive up the cost of coverage for everyone else in the group.
That is why most individual LTCI policies actually cost less for relatively healthy applicants, the underwriting procedures in use effectively screen out most of those costly severe health cases. One of the ways that group LTCI companies can mask or hide the increased cost of their policies is by not including an automatic inflation benefit as part of the premium. They typically tell you that they are providing a 5% compound inflation protection, but they do it as something called a “Future Purchase Option.” This means that they will come back every three years or so to make an offer based on an additional 5% compound increase in benefits. This is the least expensive way to buy LTCI initially because inflation protection is not built into the premium. The problem is that it is the most expensive way to buy LTCI over the life of the policy because you are buying additional protection every three years at a later age. In any case, once you are paying for that additional protection at that later age instead of the age when you originally purchased the policy. So these kind of policies often wind up costing the policyholder twice as much or more over the life of the policy, as if they had just bought the automatic inflation protection built into the policy at inception. Another method that group policies use to lower premiums by providing less coverage is reducing the home care benefit to 50 to 75% of the daily benefit.
This may indeed lower costs, but it is not helping policyholders accomplish what they usually want most: to stay at homecare and remain as independent as possible for as long as they can. Of course, some group policies can be a very good value, but it is always a very good idea to individual policies using identical benefit features to make the comparison fair for long term care.
What Can Life Insurance Do For You? Helpful Facts To Know
July 13, 2009
The first and foremost thing for you to take into account is that the purpose of life insurance is to make certain that your life targets concerning your family and loved ones will be met in the case of your death before achieving the mentioned aims.
In order to provide you with more information and thus better comprehension of the matter there is a need to point out that before you commit to an insurance policy, firstly, you need to get all necessary knowledge about all the options available through the assistance of a life insurance specialist. Secondly, you need define your purposes.
In fact, the final expenses are at the top of the list of considerations. There is no need to mention that this is very tough to plan for as we do not know what the circumstances will be surrounding our death. The only thing that could be said with some kind of confidence is that there will be medical bills to take care of, and then whatever funeral costs will be incurred. It should be also mentioned that your life insurance policy should leave your beneficiaries no worse off than they are while you are alive and providing for them but sometimes it is not easy to achieve this!
You should also keep in mind that your life insurance policy should cover all outstanding balances you may have at the time of your death in addition to the price of those medical bills and funeral costs.
The other important thing for you to take into consideration is that it is necessary to establish what it costs to support your family in the way in which they have become accustomed. If you do so, you will understand what it will take for them to continue living within the same standard of living should you expire.
Besides, you need to take into account that before you can estimate with a reasonable sense of accuracy the appropriate amount for your life insurance policy it is needed to project your monthly and twelve-monthly costs of living into the future. The other step that is also needed to be done is to estimate of inflationary costs and gear that figure into your standard of living estimate.
You need also to consider the goals of your family. To go into more details it should be pointed out that a life insurance policy affords your family the chance to pursue the things that make them happy.
So, when you are going to select whole life insurance, you need to consider that there are lots of points to take into consideration. Of course, an insurance agent informs you as to what is accessible to cover your financial needs in death, but the truth is that, you are the only person who is capable of deciphering how you can best provide for your family in the case of your death.
You need also to be aware of that the following things must be clearly understood:
• You need to check your own expenses, your bills and funeral costs are not transferred to your family.
• You need to take care that the selection you are making is right in order your family may continue to prosper without you.
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Choosing The Long-term Care Insurance Company That’s Right For You
July 13, 2009
Becoming familiar with the foundational features and options of a good long-term care insurance (LTCI) policy requires taking enough time to educate yourself before making your final decision. This will help ensure that you get the policy that will best fit your particular needs. The next step is to find the insurance provider that will suit you best. Since there are a number of LTCI carriers to choose from, here are a few suggestions for selecting a company that is worthy of your trust in the many years and also offers a quality product.
Among the companies that offer LTCI, there are a few that have an outstanding reputation. By that, I mean these companies have distinguished themselves over a long period of time as financially solid, rate-stable carriers with an excellent customer service record. The only problem is that we see so many stories in the media these days of other LTCI companies whose record in these areas is being seriously challenged. It’s been reported that some have appeared to excessively deny claims in order to make a profit. Others have had to request hefty premium increases due to a much higher number of claims than they had projected. While these stories may hold some truth, what we don’t hear is the good stuff: LTCI companies that really adhere to their claims of the customer being #1.
In the June 18, 2007 issue of the Newsweek magazine recommended the following four companies as being major carriers that can be worthy of your consideration: Genworth, John Hancock, MetLife, and Allianz Life. But this does not mean that there are no other fine companies out there represented in the LTCI field, but the four carriers identified by Newsweek are among the oldest and financially strongest in the industry. They also have extremely favorable records of customer satisfaction.
Genworth, John Hancock, MetLife and Allianz Life are all fine choices if you are in excellent health. However, if you have health issues that are not serious enough to render you uninsurable, but will most likely disqualify you for ” preferred ” rates, the company you choose can have a significant impact on your premium. The reason for this is that each company has its own underwriting procedures that it uses for rating policyholders. These procedures can vary greatly from one company to the next. For instance, one company will not issue a ” preferred ” rating to someone who uses even a single blood pressure medication while others will allow the use of up to four of these medications and still award the highest rate classification for long term care
Once you have more serious health conditions, the difference in the way individual carriers treat those issues can even be more serious. In other words, some health conditions that one carrier may accept may be cause for rejection by another provider. Here is where having the assistance of a knowledgeable, experienced agent who can choose from several top companies in the LTCI field, can be a real asset in finding the company that is not only trustworthy and reliable, but also best fits your particular needs and home health care history.
Life Insurance – What Do You Want Your Life Insurance Policy To Give You?
July 12, 2009
In fact, when people make a decision about life insurance and time frame and cost issue are very critical to you then it means that term life insurance is perfect for you. It should be pointed out that it is crucial to be knowledgeable about that a term life insurance policy does not accumulate interest. As well, it does not increase in value over the length of the term that is one of the reasons for that this sort of policy is rather reasonable alternative of whole life insurance quotes for everyone to choose.
You should also know that death benefits may be bought for periods that come in incremental blocks. Classic examples of these blocks are 10, 20 or 30 years. It should be also added that after the term of the benefits has expired, the “lease” is over and there are no more commitments from either party.
It could be say that the party is over except you want to pay the Insurance Company’s very expensive renewal premium at the end of the term period which is always financially unrealistic for most folks. It is necessary for you to take into account that a term life insurance policy is created to pay out one specified amount to the beneficiary, should the policy holder die during the term. To go into more details it should be pointed out that term life insurance is meant to offer financial relief for your family during these emotional times. There is no need to mention that you will want your family to have the means to benefit from financial advantage (beyond the cost of your funeral arrangements) after your demise. As a matter of fact that a term policy is perfect for families who are still getting started or who have little or no established security.
In the case you are looking for a policy to be in place for when you die (no matter when you die) a term policy is not the appropriate class of coverage. You see, the point is that depending upon the Insurance Company, it may be possible to transform your term life insurance policy after it has been purchased, to a permanent insurance policy without proving insurability. Bear in mind that this policy will payout when you die, regardless of time.
You should also to know about the dissimilarity between a permanent insurance policy and a term insurance policy. So, simply speaking, the permanent life insurance policy gains cash value over time and your premium is typically “level”. You need also to understand that this permanent life insurance policy is not like a lease. It that simple – you acquire it, pay your “level” premiums and you get it. It should be also mentioned that the permanent life policy is not constrained to a certain time period and should gain interest over time. The benefits of a permanent life insurance policy are many as it should continue to grow in worth as long as the premiums are paid.
In conclusion there is a need to point out there is such a necessity, a policy holder has the possibility to borrow against the accrued cash value of the policy but this is not recommended. In addition there is the other critical thing to keep in mind that in most permanent universal policies, you either have the cash value or you have the insurance. But in the case you borrow against the permanent universal policy, you are stripping out the “guts” of the policy. In order you can realize better you need to know that it may lead to that it might be complicated or impossible for the policy to stay in force for a long period of time.
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The Advantages Of Long-Term Care Insurance For Couples
July 11, 2009
Long-term care insurance is a good financial protection vehicle for anyone who has enough assets to protect and can also comfortably afford the premiums. It can help ensure that all of the time and effort you have spent on acquiring a sufficient retirement income is not lost due to the rising costs of long-term care. There are a lot of specific advantages for couples purchasing long term care insurance. Consider this: most often, the healthier spouse acts as the primary caregiver. Without long-term care insurance, the healthy spouse often takes on the bulk of care giving duties, to try to simply avoid paying the high costs associated with either in-home care or institutional care. Eventually, this can leave the caregiver almost as ill as his or her spouse. Take note that long term care insurance helps in giving the necessary funds so that the healthy spouse can make sure that quality care is provided for the ill spouse while not further endangering his or her own health.
Couples can even save more money on the purchase of long-term care insurance, as all major carriers will discount the cost of a policy by thirty to forty percent when both spouses are on the same policy. This can result in significant cost savings for married couples. The good news is that even those who may not be married but have lived with someone else with whom they are in a committed relationship for more than a year may also receive the same discount for long-term care insurance. If one spouse is approved for a policy but the partner may have health issues that may preclude him or her from qualifying for long-term care insurance, this does not mean that the couple should decline coverage for the healthy spouse. Long-term care insurance is still an advantage for this couple because no one knows which spouse will need long-term care first.
Once there is a major health reversal for the previously healthy spouse, the one who had health issues originally would be in an even more disadvantaged position as a caregiver. In this case, long-term care insurance would provide the funds needed for quality care without further damaging the health of the spouse who was declined for the long-term care insurance policy. It is actually unreasonable to forget health insurance for one spouse simply because the other cannot qualify for a major medical plan. The same is true for long-term care insurance. It may be disappointing that both cannot be covered, but the financial risks for each of them are still prevalent and should not be ignored.
A Quick Comparison: Long-term Care Insurance, Long-term Disability Insurance & Critical Care Insurance
July 11, 2009
Let’s say you got sick and your regular health insurance can’t cover all your expenses, then what should you do? Below are three good options along with some pointers and explanations. If any of these types of supplemental policies have had positive (or negative) effects for you and your loved ones, we’d love to hear your story. Snapshot: Long-term Disability Insurance (LTDI) is for individuals who are working and younger than 65. Some financial planners propose that LTDI is your best bet because it will protect your income if you are unable to work for a period of time. LTDI is also sometimes referred to as income protection insurance.
With this type of policy, you will be unable to do your normal occupational duties in your work environment. These policies are created for people who are actively working;although those in risky jobs may find that they are undesirable to insurance companies. Once a covered disability happens, then a specified monthly benefit is paid to you for a finite period of time (typically no more than two years).
Snapshot: long term care Insurance (LTCI) should be purchased in your fifties or as soon after retirement as possible it’ll pay out a monthly benefit for the type of care your policy allows. LTCI is geared toward the senior market. There are actually three types of policies: each of which is based on where benefits will be paid: either in a facility, at home or both. This type of insurance stems from the idea that as you age you may need assistance with almost anything from the activities of daily living (e.g., dressing or bathing) to skilled nursing care, and that in-home caregivers and care facilities are not affordable for many of us. In addition to that, many worry about draining their personal financial resources, resulting in an inability to leave an inheritance for their loved ones, or even their own means of supporting themselves.
For more information on when to buy LTCI, check out Is Long-term Care Insurance Worth It? Snapshot: Critical care insurance pays one lump sum and then terminates, however your particular life-threatening condition must be enumerated in your policy. With critical care insurance, you are also paid a large amount after you have been diagnosed with a critical illness. The idea is that auxiliary expenses tend to pile up just when the diagnosis occurs even if a person is insured in adult day care.
With the help of a critical insurance plan, the beneficiary can decide where his/her benefits will do the most good, whether it goes toward skilled nursing in home health care, or lost wages for family caregivers, or other expenses of daily living that are difficult to meet when one is financially disabled. Because the policy only pays you once, it has some advantages and disadvantages; while you are responsible for managing the funds sufficiently, a large payment can ensure that debt isn’t allowed to accrue.
No Long-Term Care Insurance? Read This!
July 11, 2009
There are several reasons why consumers may choose not to buy long-term care insurance. Some of those reasons may be based on very sound decisions. For instance, if you have made a good research into the cost of premiums from several of the financially sound major carriers and have realized that the cost if much more than you can bear, then long-term care insurance is not for you. But if you are like most people, the real reason that you are hesitant to prepare for possible future long-term care costs has very little to do with reasoning or sound decisions. Your hesitation is most likely based on emotions and feelings. Many people live in a state of denial about their possible need for assisted care services in the future. This is always because they have been healthy; therefore, they find it hard to even picture themselves in a state where they may need assistance with activities of daily living.
Or maybe their parents have died suddenly with or within a short period of time, so they figure that most likely, the same will happen to them. Or maybe the feeling of denial is too strong that very little thought has gone into the matter at all. If that is the case, this topic is probably too depressing to most of these people that they have consciously chosen to delay any decision about purchasing long-term care insurance until later. Only problem is, that time will never come. Why? None of these thought processes are based on fact. We all know that good health can change overnight. And also, I knew someone whose health situation changed greatly within a short period of time. This risk obviously increases with age, so the chances of it happening to any individual, including you and me, are very real. Due to the advances in medical science in recent years, using the health history of your parents as an exact guide for your own future home health care doesn’t work.
It is indeed obvious that more and more people are living longer and often need more in the last years of their life. And long-term care is extremely expensive. If you are among those who refuse to even think about their future health care needs, ask yourself this: who will be left to make this decision for you? If you refuse to think about the subject, it does not make the possibility of needing long term care any less real. It simply defers the decision to those you love the most. They will often have to make decisions about the type of care at the last minute, when the choices are extremely limited, unpleasant and expensive. Our families will be well served if we all decide now to take responsibility for our own future health care needs and make sound decisions based on facts instead of unreasonable emotions.
Open-Enrollment Period For Medicare Advantage
July 11, 2009
Most people are well aware of the gaps within the original Medicare plan. For one, there’s no ” stop loss ” feature. Other health insurance policies will pay 100 percent towards some medical services after you meet your deductible, for example, you might have to pay $1,500 per year before your benefits will kick in. If you have Original Medicare and need hospital care or must enter a nursing home, this applies to you. Some of the Medicare Advantage Plans cover all the same services Original Medicare covers, and potentially some it doesn’t.
These plans are offered in some parts of the country through private long term care insurance companies, but are still part of the Medicare program. If you’d like to switch to a Medicare Advantage Plan, now’s the perfect time. Open enrollment for Medicare Advantage extends from January 1st through March 31st. You are eligible for a Medicare Advantage Plan if you currently have Medicare Part A or Part B. You will, however, need to see doctors and use hospitals within the plan, much like you would with an HMO. If you’d like to switch plans, always remember that you cannot drop Medicare prescription drug coverage. If your existing plan has prescription drug coverage, then your new one needs to have it as well.
For more information on the plans available in your area, visit Medicare’s web site or call 1-800-633-4227. Your new plan should be effective on the first of the month after your request is received. Still not sure what all the Medicare plans cover? Gilbert Guide lists all of the major types of insurance as well as what they cover. For a detailed explanation, check out Gilbert Guide’s Medicare Explained or Senior Care Reimbursement Overview, which will show you where each type of insurance pays benefits.
CCRCs are living communities for seniors. Most have three levels of residence: independent living, assisted living and skilled nursing. Each level of residence is tied to the level of care that the resident requires. The primary idea behind a CCRC is that it offers a wider spectrum of care, so that once a senior moves into the community, he or she will be able to receive the appropriate care as his or her needs change. Many CCRCs support aging in place.