How may people have LTC insurance in US?


It's easy to buy long term care insurance in the US. However, it's best to do your homework first to determine whether you do need the policy and just how much you need.

Here are the simple steps you can do:

  • Ask: Is it better to self-insure or to buy insurance? If you have enough assets (above $2,000,000), then it may make sense to just put aside money in case you will need long term care. Now, if you have assets lower than $200,000, do you have the ability to spend this down so that you can qualify for Medicaid or other government-sponsored programs? What you can do is to gift your assets to your heirs so that you will have few assets in your name.
  • Study the cost of long term care facilities. Do some research on the nursing homes and long term care facilities in your area. Study these facilities so that you can already have an idea of which ones you prefer and how much they would cost. Take a look at the day-to-day fees of these facilities.
  • Study the various insurance companies that provide long term care insurance. Which ones have a good reputation with regards to claims payment? Ask around about how people are satisfied with the service of a particular insurance company. You can even go to nursing homes or other long term care facilities to ask the staff about how insurance companies rate with them. You need to go with an insurance company that will last until the time you will be making a claim on the policy. You don't want to invest in a policy only to find out 10 to 20 years down the line that your insurance company has gone out of business.
  • Base your computations on the cost of the facility you would want to be admitted to in case you need long term care. Make provisions for inflation. Use this daily amount to determine just how much insurance coverage you will need.
  • Make a checklist of the features you want your policy to have. These can include:
    • Guaranteed renewability/non-cancellation
    • Coverage for the facility you want
    • Coverage for the diseases you think may affect you in the future
    • Length of waiting period
    • Length of elimination period
  • Ask for quotes from the various insurance companies and compare the features of the policies. Check to make sure that the provisions you want included are explicitly listed in the policy you are considering.
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