As the baby boomer generation begins to retire en masse, more and more attention is being paid to long term care insurance. Despite the fact that many of us do not like to pay insurance premiums, insurance of all types play an important role in our financial plans. Long term care insurance, like all other types of insurance, helps to reduce the financial impact of unforeseen and dramatic life events. Without insurance, an event such as a car accident or house fire can quickly drain any and all of a family's savings.
Today there is a growing risk to our financial well-being; advances in modern medicine and technology. With the help of advancements in the medial industry we are living longer than any other generation. Despite the obvious great things that come with a longer life, to the retired, living longer will significantly increase all types of medical costs.
Common Long Term Care Insurance Questions
Who Should Buy Long Term Care Insurance - Long term care insurance should, more than likely, be purchased before retirement or as you approach 65 years in age. The additional costs of long term care insurance premiums will be enough to turn a few people away. However the costs of not being insured will be much more.
Why Purchase Long Term Care Insurance - The Government sponsored medical insurance, Medicare, only provides 100 days of skilled nursing care. In addition to this restriction, Medicare beneficiaries will not qualify for long term care needs unless it follows a hospital stay and after significant personal cost.
How Much Does Long Term Care Insurance Cost - Market research (conducted in 2013) has shown that purchasing long term care insurance can cost from $1,300 to $4,600 annually. Most of these policies provided a benefit of $150 a day with a term of 4 years. When compared to the cost of the average nursing home stay of $89,000, the costs of long term care insurance premiums are insignificant.
Popular Long Term Care Provisions
Guaranteed Policy Renewal - A life insurance policy is inherently a business contract, one party agrees to cover the potential large costs of an individual while the individual agrees to pay a small fee consistently overtime. If the contract (policy) does not include a provision that the coverage must be renewable for life, the policy and any coverage can be cancelled.
Medical Cost Inflation Protection - In addition to education, medical costs are one of the fastest growing personal expenses in the U.S. economy. A good long term care policy should included a provision that protects the policy holder from the increasing cost of medical care.
Pre-hospitalization Coverage - As mentioned previously, Medicare will most likely not cover the costs of long term care if a hospital stay was not required. To avoid this situation ensure that your policy does not require that your coverage require hospitalization first.
Comprehensive Long Term Care Services - When comparing different long term care policies, keep in mind that assisted living, home health care and nursing home care is available. It is unknown what the future holds, thus its a good idea to have all three services in your policy.
Long term care insurance is an increasingly important element of a financial plan. Long term medical issues can place a large financial burden on a family in it's most pressing time of need. To avoid financial catastrophe, ensure that you and your family are properly covered.