A friend recently asked about long term care (LTC) insurance. Her financial advisor reacted as if it were a “no brainer, a must have!” Part of his argument was he has three people in his family who need it, only two had LTC and the one who didn’t is struggling to pay for necessary care. My friend hates to pay for insurance that only has a 50 per cent chance of being used, although women tend to use it more often than men.
The advisor’s thinking is that we never plan to use our auto or homeowners insurance, yet we all have it. The financial advisor makes a commission when a policy is bought so he’s not entirely impartial. One can make a case pro or con and the more we become informed the more confusing it gets…a tough call.
Here are 6 thoughts on the matter for your consideration. Definitely read the literature and become informed first. At the least, look up Long Term Care Insurance and review the pros and cons in light of your particular situation.
Then, consider the following:
(1) The company that you buy LTC insurance from may not be in existence when you need it.
(2) The insurance that you buy may not cover the illness that you get which could require hospitalization.
(3) The premiums that you pay may be more than the cost of the care. Although we’re told the cost of an illness may be X annually, the stay is often less and LTC insurance becomes poorly spent funds.
(4) If one has saved regularly, its possible to financially manage your own health care. What you save and invest can be used for future health care expenses.
(5) Depending on the type of LTC insurance program selected, you may be required to pay first after which the program kicks in and pays later. Contingencies may also exist such as the type of rehabilitation facility, daignosis, length of illness, etc. Because of the possible hidden stipulations, LTC may or may not serve you well.
(6)There are alternative care options that are gaining in popularity and should. at least, be explored. One, in particular, is Home Health Care. With 76 million Baby Boomers marching through the lifeline confidently and vocally, they will, no doubt, continue to question, change and possibly revolutionize health care as we know it now in the United States.
DO YOUR HOMEWORK!
What’s your experience with LTC insurance.? Share it with other readers and get more informed before you make personal choices and investments.
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