With significant losses to savings and investments, many Americans are uncertain about their retirement security and ability to pay for long-term care (LTC) services. According to a new survey by the nonprofit LIFE Foundation, 64 percent of Americans age 45 and older think the economy has had a major negative impact on their ability to pay for LTC services. The U.S. Department of Health and Human Services estimates 70 percent of Americans will need care, proving how financially vulnerable people are without a LTC plan. Although 58 percent of adults think they might need LTC services and 61 percent think a loved one will, few own insurance.
On average, the cost for long-term care services is roughly $70,000 a year. In today's tough economic environment, most people have far less money available to pay for these services, and it's likely they will need them. Long-term care insurance guarantees that you will always have the financial means to afford the kind of care you'll need and prefer.
Below are five facts people might not know about LTC to encourage them to assess their needs.
You can Share the Care -- Many long-term care policies offer the option of a shared benefits rider, which enables a couple coverage from one policy up to a specified limit.
State Programs Offer Savings -- Many states created Long-Term Care Insurance Partnership Programs as an incentive to purchase policies, guaranteeing that if an individual uses the policy's benefits, he or she can qualify for Medicaid without depleting assets.
Home Care is an Option -- A big misconception is that LTC insurance only covers nursing home or assisted living facility care. Actually, home care is included in virtually all policies sold today. According to leading long-term care insurer Unum, 70 percent of its customers use LTC benefits for home care.
Coverage before Saying "I Do" -- With more people marrying or remarrying at older ages, LTC insurance in prenuptial agreements or alimony packages is becoming more common. If both individuals purchase a policy, each person’s assets and lifestyles will be protected should either need future care.
Not too Late to Purchase Coverage -- Experts recommend people consider LTC insurance in their 40s, when they are young, healthy and can lock in a preferred premium coverage rate. If over 60, it is not too late as many insurance companies sell policies to those in good health into their 80s.
In light of the importance of long-term care, MDRT recently held a Web seminar featuring LTC expert Phyllis Shelton on "Selling Long-Term Care Insurance to the Wealthy." Phyllis discusses the tremendous financial impact of LTC and the incredible marketing opportunity for agents interested in the fastest growing insurance product in the nation. She also discusses the psychology of selling to the wealthy and their motivations for purchasing LTC insurance.
The presentation, as well as other archived MDRT Web seminars, is available at http://www.mdrt.org/membership/WebSeminarSeries.asp.
