All long term care insurance policies carry the basic components such as the maximum benefit amount, maximum benefit period, elimination period, and an inflation protection rider.
All these are important and thus buyers are always advised to read, assess and review every word and sentence that is stipulated on their policies.
Not all long term care insurance (LTCI) policies are ideal. For instance, one that has a long benefit period, a high maximum benefit amount, a short elimination period, and a compound inflation protection can definitely be considered as ideal as the policyholder will definitely receive complete coverage. No need to shoulder a portion of her long term care (LTC) expenses or wait too long before her benefits start rolling in.
Before the recession that would've been possible. Unfortunately, majority of American families nowadays are tightening their belts and even though most of them cannot afford LTCI, they've decided to invest their hard earned money into it lest they lose everything that they've worked hard to accumulate.
To afford their annual premiums some policyholders have cut back the maximum benefit amount and shortened their maximum benefit period. Some have even resorted to a 180-day waiting period while there are those who have decided to settle for the simple annual inflation protection.
Now this is good rather than not purchasing LTCI at all provided that you study very well which components of your policy to move and adjust. It is not enough to cut down everything just so you can save on annual premiums. After all, premium payment automatically stops the moment an event calls for LTC.
Inflation Protection in Long Term Care Insurance Policies
Let's say after requesting LTCI quotes from an insurance representative, who is affiliated with various insurance companies, you realized that a potential comprehensive LTCI policy will cost you $2,000 annually.
If you feel you cannot afford this amount you can opt for another type of LTCI coverage by reducing the given values of the LTCI policy which was originally presented to you.
For example, if the elimination period that is stipulated in the comprehensive policy which your agent showed you is 30 days you can make it 90 days, or even 180 days if you have a solid nest egg to use for your initial LTC expenses.
In case you are not confident with your resources, then keep your elimination period at 30 days and adjust your maximum benefit amount. Instead of your initial plan of receiving $300,000 in benefits you can opt for $200,000.
Expect to hear negative remarks from your spouse and children once you decide to reduce your maximum benefit amount because the cost of care is constantly increasing. As a matter of fact it is expected to double in year 2026 and quadruple in 2030. Reducing the total amount of your policy benefits, however, is not a bad thing if you have an inflation protection as this will double your initial maximum benefit amount in 15 years.
Experts on long term care insurance policies will not advise you to go for a simple inflation protection, except if you are beyond 75 years old and expecting care in the next couple years, as this will not provide you with any protection. This is especially true for those who are looking at 30 years or even later to receive care. It is best to cut down everything but inflation protection.
All these are important and thus buyers are always advised to read, assess and review every word and sentence that is stipulated on their policies.
Not all long term care insurance (LTCI) policies are ideal. For instance, one that has a long benefit period, a high maximum benefit amount, a short elimination period, and a compound inflation protection can definitely be considered as ideal as the policyholder will definitely receive complete coverage. No need to shoulder a portion of her long term care (LTC) expenses or wait too long before her benefits start rolling in.
Before the recession that would've been possible. Unfortunately, majority of American families nowadays are tightening their belts and even though most of them cannot afford LTCI, they've decided to invest their hard earned money into it lest they lose everything that they've worked hard to accumulate.
To afford their annual premiums some policyholders have cut back the maximum benefit amount and shortened their maximum benefit period. Some have even resorted to a 180-day waiting period while there are those who have decided to settle for the simple annual inflation protection.
Now this is good rather than not purchasing LTCI at all provided that you study very well which components of your policy to move and adjust. It is not enough to cut down everything just so you can save on annual premiums. After all, premium payment automatically stops the moment an event calls for LTC.
Inflation Protection in Long Term Care Insurance Policies
Let's say after requesting LTCI quotes from an insurance representative, who is affiliated with various insurance companies, you realized that a potential comprehensive LTCI policy will cost you $2,000 annually.
If you feel you cannot afford this amount you can opt for another type of LTCI coverage by reducing the given values of the LTCI policy which was originally presented to you.
For example, if the elimination period that is stipulated in the comprehensive policy which your agent showed you is 30 days you can make it 90 days, or even 180 days if you have a solid nest egg to use for your initial LTC expenses.
In case you are not confident with your resources, then keep your elimination period at 30 days and adjust your maximum benefit amount. Instead of your initial plan of receiving $300,000 in benefits you can opt for $200,000.
Expect to hear negative remarks from your spouse and children once you decide to reduce your maximum benefit amount because the cost of care is constantly increasing. As a matter of fact it is expected to double in year 2026 and quadruple in 2030. Reducing the total amount of your policy benefits, however, is not a bad thing if you have an inflation protection as this will double your initial maximum benefit amount in 15 years.
Experts on long term care insurance policies will not advise you to go for a simple inflation protection, except if you are beyond 75 years old and expecting care in the next couple years, as this will not provide you with any protection. This is especially true for those who are looking at 30 years or even later to receive care. It is best to cut down everything but inflation protection.
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