Can You Afford NOT to Have Long-Term Care Insurance?

Do you have the perception that long-term care insurance is too expensive? Do you think that you will never need help with the activities of daily living? Do you think you are too young to put together a plan for long-term care?Many financial experts say that LTC insurance is important for protecting retirement savings. The average cost of a nursing home stay is $70,000/year. A home health aide providing care giving can be $18-$20/hour. The cost of not having coverage can be devastating.Most people do not know realistically know what the cost is for LTC services, which includes home health care, custodial services and nursing home care. LTC is generally not covered by health insurance policies or disability insurance. Medicare does not cover ongoing long-term care services. It only pays for limited amounts of “skilled care” in a nursing facility or at home, when that care meets strict guidelines established by Medicare.

A lot of people think they can just pay for LTC services if or when they need it. At the current costs, it doesn’t take long for the cost of care to exceed the cost of insurance. The cost of just two or three years in a nursing home can wipe out the average American’s retirement savings.According to the MetLife 2009 Mature Market survey, the national average cost of long-term care for one year in the various settings is:Long-term-care setting Cost Increase from 2008Nursing home: private room $79,935 3.3%Nursing home: semi-private room $72,270 3.7%Assisted living facility $37,572 3.3%Home healthcare aide $21/hour 5%Adult day Care $67/day 4.7%Some insurance companies offer policies that provide greater flexibility as to how benefits can be used. Policies that offer cash benefits instead of traditional reimbursement can cover the indirect expenses associated with long-term care, such as travel expenses, lost income for a family member serving as a caregiver, housekeeping services or other out-of-pocket costs. As soon as you trigger benefits, you receive a cash payment.Some carriers offer a combination of cash and reimbursement in terms of paying claims.So now that you have determined that long-term care insurance is a financially sound way to minimize your financial exposure, protect your assets, not become a burden on your loved ones as well as enhancing your choices and independence, it time to design a unique plan for you.Here are the important elements of the policy:• Determine the level of assets you want to protect

• What is the current cost of care? (where you live or plan to retire)• Length of time-you’d like to be coveredThe cost of the long-term care insurance policy is based on:• Your age• The type of policy- comprehensive, facility only• Daily/Monthly benefit• The extras-ie: restoration of benefits, shared care• Inflation protection• Elimination period- acts like the deductibleLong-term care specialists provide free, no obligation consultations with clients to determine if this type of insurance makes sense for them. If it does, then the independent broker can shop all the top carriers and find the best fit for the client.For more information on designing a long-term care policy, Visit: Your LTC Specialist

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