Long term care insurance is no longer a luxury in today’s economy. With the cost of nursing homes and long term care facilities averaging more than $200 a day, people are looking into long term care insurance to assist them. Here are 10 things you should know about long term care insurance.
- Medicare will not pay for long term care. Many people mistakenly believe that because they’re retired and on Medicare, their care is automatically covered. They only provide coverage for short-term care unless you have a very limited income.
- Long term care insurance pays for care in more than just nursing homes. Although each policy varies, most will pay for assisted living facilities, home health aides, adult day care, and even care in your own home.
- The average annual cost of long term care insurance for a healthy individual in their 50’s is about $2,000 in 2013, according to the American Association for Long-Term Care Insurance.
- More people every year are buying and utilizing long term care insurance. In 2011, approximately 337,000 Americans purchased long term care insurance, and about $6.6 billion was paid out in claims that same year.
- The cost of long term care insurance can vary from state to state. The total cost of this insurance is generally based on what the cost of long term care is in that particular state.
- Getting an inflation rider in your long term care policy is more than worth the cost. With the high cost of living and rate of inflation, it’s important to know that the benefits you chose will adjust with inflation.
- If money isn’t an issue when you’re younger, you may benefit from choosing an accelerated payment option or paid-up premiums. You may pay higher annual premiums for several years, like possibly ten years, but then the policy is paid for the rest of your life.
- Look for carriers that offer shared benefit riders for married couples. This allows married couples to share their benefits. If one uses up their benefits, they can start using their spouse’s. Some insurance companies even offer a discount of up to 40% if both spouses purchase policies.
- An employee group long term care policy may not be the best option. It may save you some money up front, but if you lose your job, the policy may discontinue and all your money will be gone.
- There are various ways you can lower or adjust your premium. Factors like maximum term, daily benefit amount, waiting period, and amount of inflation rate are just a few of the many things that can affect your premium.
When shopping for long term care insurance, keep in mind that all insurances and insurance companies are not created equal. Shop around until you find the best option, and stick with a company that you’re confident will be around in 20 years.