Long term Care Insurance

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vrpatel1
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Long term Care Insurance

Post by vrpatel1 »

Need help/suggestions. I am 52 yrs old and thinking about Long term Care Insurance. Hybrid policy (Life insurance/Long term care insurance) vs self funding from my investmnents/savings.
delamer
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Re: Long term Care Insurance

Post by delamer »

Are you married?
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vrpatel1
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Re: Long term Care Insurance

Post by vrpatel1 »

yes. and 2 daughters
TravelforFun
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Re: Long term Care Insurance

Post by TravelforFun »

You will get different opinions on LTCi from folks on this forum but your age would be the perfect age to purchase a policy if you decided to go that route. I bought one when I was in my early 50s and I'm glad I got it.

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JoeRetire
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Re: Long term Care Insurance

Post by JoeRetire »

vrpatel1 wrote: Thu Dec 12, 2019 7:25 pm Need help/suggestions. I am 52 yrs old and thinking about Long term Care Insurance. Hybrid policy (Life insurance/Long term care insurance) vs self funding from my investmnents/savings.
How much extra do you have in your investments/savings that you are willing to keep aside earmarked for your long term care?
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delamer
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Re: Long term Care Insurance

Post by delamer »

To me, the biggest risk is that one spouse needs long-term care while the other is still healthy and able to live independently. That can be a huge strain on the family’s finances.

So while I don’t have any specific recommendations, I would consider that scenario in your planning.
jimishooch
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Re: Long term Care Insurance

Post by jimishooch »

WoW2012
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Re: Long term Care Insurance

Post by WoW2012 »

vrpatel1 wrote: Thu Dec 12, 2019 7:25 pm Need help/suggestions. I am 52 yrs old and thinking about Long term Care Insurance. Hybrid policy (Life insurance/Long term care insurance) vs self funding from my investmnents/savings.
If you and your spouse are healthy, don't waste your money on a Life/LTC hybrid. Buy a traditional LTCi policy. When comparing similar long-term care benefits, at your age, the hybrids are about 3x to 4x more expensive than buying a traditional LTCi policy.

Depending upon what state you live in, a healthy couple in their early 50's could share $1,000,000 of LTCi benefits for about $170 per month per spouse. The inflation protection would increase the benefits every year (without increasing the premium each year). Within 24 years, you'd have over $2,000,000 of shared benefits. Within 38 years you'd have over $3,000,000 of benefits. The growth is guaranteed.


Disclaimer: I am a licensed insurance professional and am certified as a long-term care insurance specialist.
WoW2012
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Re: Long term Care Insurance

Post by WoW2012 »


That brochure is old. They've completely changed that product in nearly every state.
Wannaretireearly
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Re: Long term Care Insurance

Post by Wannaretireearly »

Why is there no good guide to LTC insurance? Similar to guides we have for other insurance of SS decisions and products?

Seems were all shooting in the dark....
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JMacDonald
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Re: Long term Care Insurance

Post by JMacDonald »

There is another conversation going on now that may interest you:

viewtopic.php?f=2&t=297442&newpost=4890615
Best Wishes, | Joe
WoW2012
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Re: Long term Care Insurance

Post by WoW2012 »

Wannaretireearly wrote: Sat Dec 14, 2019 5:31 pm Why is there no good guide to LTC insurance? Similar to guides we have for other insurance of SS decisions and products?

Seems were all shooting in the dark....

There is a guide published by the NAIC.
michaeljc70
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Re: Long term Care Insurance

Post by michaeljc70 »

JMacDonald wrote: Sat Dec 14, 2019 6:19 pm There is another conversation going on now that may interest you:

viewtopic.php?f=2&t=297442&newpost=4890615
+1. I saw that thread...and there have been many other similar.

I generally only insure for things I cannot afford. I plan to be able to afford LTC.

People will tell you the big increases only happen on older policies...but there are no guarantees. To me it is like buying an annuity without knowing how the terms will change in 10, 20, or 30+ years (unless you put up more unknown $$$'s).
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JoeRetire
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Re: Long term Care Insurance

Post by JoeRetire »

michaeljc70 wrote: Sat Dec 14, 2019 7:36 pm I generally only insure for things I cannot afford. I plan to be able to afford LTC.
That's a reasonable plan.

How much do you have planned for your long term care? Your spouse's?
Do you not insure your cars for the same reason? Your house? Any other property?
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Re: Long term Care Insurance

Post by michaeljc70 »

JoeRetire wrote: Sat Dec 14, 2019 7:45 pm
michaeljc70 wrote: Sat Dec 14, 2019 7:36 pm I generally only insure for things I cannot afford. I plan to be able to afford LTC.
That's a reasonable plan.

How much do you have planned for your long term care? Your spouse's?
Do you not insure your cars for the same reason? Your house? Any other property?
What percent of people use LTC insurance vs. auto or home or health in their lifetime?

I insure my car mostly for liability (which is required by law). I didn't carry collision/comprehensive for many years. I have a newer car now so I do. A $30k$40k hit is something I could "afford" but it wouldn't be pleasant. LTC maybe not pleasant to pay for, but if I require it, I require it and I am on my last legs anyway. Also, I can shop around for car insurance if I think the premiums go up too much and it is a small percentage of my income/net worth, etc. I've never had my auto insurance go up 150% or 250% in a few years like in other threads on here with LTC insurance.

If my house blew up, that would be a big hit financially so I insure it. I also have a mortgage so I have to insure it.

How much do I have planned for LTC? I have no specific amount. I am in my 40s so I haven't given it that much thought. Though I know the general stats, I've seen what's happened to many relatives and none have been in LTC very long. Frankly, it will be whatever it is. If I am flush with money (the plan), great. If not, other less pleasant arrangements will have to used.

I realize some people are very risk averse and what I do would be unsettling for them.

My grandparents paid into LTC for decades only to be crunched into ever decreasing benefits or increasing premiums.
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JoeRetire
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Re: Long term Care Insurance

Post by JoeRetire »

michaeljc70 wrote: Sat Dec 14, 2019 7:58 pm
JoeRetire wrote: Sat Dec 14, 2019 7:45 pm
michaeljc70 wrote: Sat Dec 14, 2019 7:36 pm I generally only insure for things I cannot afford. I plan to be able to afford LTC.
That's a reasonable plan.

How much do you have planned for your long term care? Your spouse's?
Do you not insure your cars for the same reason? Your house? Any other property?
What percent of people use LTC insurance vs. auto or home or health in their lifetime?
I don't know. What percentage of people insure only for things they cannot afford?
I insure my car mostly for liability (which is required by law). I didn't carry collision/comprehensive for many years. I have a newer car now so I do. A $30k$40k hit is something I could "afford" but it wouldn't be pleasant.
Okay. So you can afford it but it wouldn't be pleasant.
LTC maybe not pleasant to pay for, but if I require it, I require it and I am on my last legs anyway.
Okay. So even though it wouldn't be pleasant, in this case you would be on your last legs, so apparently the unpleasantness wouldn't matter.
Also, I can shop around for car insurance if I think the premiums go up too much and it is a small percentage of my income/net worth, etc. I've never had my auto insurance go up 150% or 250% in a few years like in other threads on here with LTC insurance.
I've never had my LTC insurance premiums go up. At all. Ever.
How much do I have planned for LTC? I have no specific amount. I am in my 40s so I haven't given it that much thought.
Okay. So you have decided that you can afford to pay for your long term care. But you don't know how much that will be, nor have you given it much thought.

You said that you don't insure things that you can afford and that you plan to be able to afford your long term care. It actually sounds more like you've just chosen not to think about it. A lot of people take that approach.

I wish you luck.
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vrpatel1
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Re: Long term Care Insurance

Post by vrpatel1 »

JoeRetire wrote: Thu Dec 12, 2019 7:58 pm
vrpatel1 wrote: Thu Dec 12, 2019 7:25 pm Need help/suggestions. I am 52 yrs old and thinking about Long term Care Insurance. Hybrid policy (Life insurance/Long term care insurance) vs self funding from my investmnents/savings.
How much extra do you have in your investments/savings that you are willing to keep aside earmarked for your long term care?
I have whole life insurance policy with $85k cash value and my wife has about $40k. The quote I have received is for single premium LTC policy. It approximately pays about 4 times the premium. We are both healthy without any medical conditions. Also, we save maximum in our retirement portfolio including backdoor Roth, about $75-80k/year.
myleaf
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Re: Long term Care Insurance

Post by myleaf »

Let us share out thoughts regarding LTCi.

We recently decided to purchase a traditional LTCi policy.
DW 62 Me 64 (previously was deciding to self-insure)
Both Healthy
We are typically not risk takers. Need to plan for LTC.

Some considerations: some which were mentioned in this thread.

We would not want one person's LTC to drain retirement nest egg.
Did not want children to have to be care providers or provide financial support for our LTC needs (typical case).
More freedom in choosing care facility
Policy covers not just nursing home care but assisted living / home care
State Partnership plan (helpful for worst case situations)
The need to allocate some of our nest egg for the possibility of LTCi

It was a choice between:

Pay a lifetime of premiums which we do not plan to benefit from.
Dedicate/Reserve a large pool of money that we should not use in our lifetime (a significant portion of our retirement nest egg)
(but will eventually go to our kids which will not fully benefit from that late in there lives)

Everyone's situation is different. It is not a simple decision.
But whatever the decision, it will probably work out either way.
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Re: Long term Care Insurance

Post by michaeljc70 »

JoeRetire wrote: Sun Dec 15, 2019 7:32 am
michaeljc70 wrote: Sat Dec 14, 2019 7:58 pm
How much do I have planned for LTC? I have no specific amount. I am in my 40s so I haven't given it that much thought.
Okay. So you have decided that you can afford to pay for your long term care. But you don't know how much that will be, nor have you given it much thought.

You said that you don't insure things that you can afford and that you plan to be able to afford your long term care. It actually sounds more like you've just chosen not to think about it. A lot of people take that approach.
Joe, I have no idea how much money I will have in 30 or 40 years. Do you know how much you will have then? Based on family life expectancies, I could live another 44 years. I have no idea what healthcare will cost then let alone if I will need LTC. I'm not sure that I should be spending much time trying to figure out things that are impossible to figure out. I try to save, invest and spend wisely and I am happy where I am now and hope that that will continue in the future.
WoW2012
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Re: Long term Care Insurance

Post by WoW2012 »

vrpatel1 wrote: Sun Dec 15, 2019 9:05 am
JoeRetire wrote: Thu Dec 12, 2019 7:58 pm
vrpatel1 wrote: Thu Dec 12, 2019 7:25 pm Need help/suggestions. I am 52 yrs old and thinking about Long term Care Insurance. Hybrid policy (Life insurance/Long term care insurance) vs self funding from my investmnents/savings.
How much extra do you have in your investments/savings that you are willing to keep aside earmarked for your long term care?
I have whole life insurance policy with $85k cash value and my wife has about $40k. The quote I have received is for single premium LTC policy. It approximately pays about 4 times the premium. We are both healthy without any medical conditions. Also, we save maximum in our retirement portfolio including backdoor Roth, about $75-80k/year.

A traditional LTCi policy is BY FAR the best value for you. Please run awaaaaaaaaaaaaay from that hybrid.
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Re: Long term Care Insurance

Post by neilpilot »

michaeljc70 wrote: Sun Dec 15, 2019 10:53 am
JoeRetire wrote: Sun Dec 15, 2019 7:32 am
michaeljc70 wrote: Sat Dec 14, 2019 7:58 pm
How much do I have planned for LTC? I have no specific amount. I am in my 40s so I haven't given it that much thought.
Okay. So you have decided that you can afford to pay for your long term care. But you don't know how much that will be, nor have you given it much thought.

You said that you don't insure things that you can afford and that you plan to be able to afford your long term care. It actually sounds more like you've just chosen not to think about it. A lot of people take that approach.
Joe, I have no idea how much money I will have in 30 or 40 years. Do you know how much you will have then? Based on family life expectancies, I could live another 44 years. I have no idea what healthcare will cost then let alone if I will need LTC. I'm not sure that I should be spending much time trying to figure out things that are impossible to figure out. I try to save, invest and spend wisely and I am happy where I am now and hope that that will continue in the future.
My experience is similar to Joe's, in that our LTC premiums have not increased since the policies were written 20 years ago at age 49.

Just like you, I also really had no idea how much money I would have in retirement, although I could certainly make assumptions and predict. It turns out that my predictions 20 years ago missed the mark, and I have more than expected. However, LTC costs have increased at a more rapid pace than my assets.

Bottom line is that I feel I was very lucky in buying a LTC policy at 49 y/o [1] from a company that, in their policy, indicated a fixed premium base and [2] decided to pay a bit more for a 3%/yr inflation rider. The $250k coverage we each started in 1999 will inflate to over $1M when we reach 75 y/o, with no premium increases expected. Hopefully we will not need to use it, just as we have so far never needed to use our homeowner or umbrella policies.

If I was 50 y/o today I don't think I would start LTC coverage now given the state of the current LTCI market.
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Re: Long term Care Insurance

Post by WoW2012 »

neilpilot wrote: Sun Dec 15, 2019 11:39 am

If I was 50 y/o today I don't think I would start LTC coverage now given the state of the current LTCI market.

What do you mean by the "state of the current LTCi market"?
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Re: Long term Care Insurance

Post by neilpilot »

WoW2012 wrote: Sun Dec 15, 2019 11:41 am
neilpilot wrote: Sun Dec 15, 2019 11:39 am

If I was 50 y/o today I don't think I would start LTC coverage now given the state of the current LTCI market.

What do you mean by the "state of the current LTCi market"?
I have had no reason to shop since our policy started 20 years ago, but as I read posts in this thread and others I think premiums are way higher. Back in 1999 the underwriters vastly underestimated their LTC loss projections.

Our annual premiums for coverage that is currently at $750k each, $300/day nursing home or $140/day assisted living and a 3% annual inflation rider, is $800/yr.

What would you pay for that coverage in a policy you wrote today?
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Re: Long term Care Insurance

Post by WoW2012 »

neilpilot wrote: Sun Dec 15, 2019 11:48 am
WoW2012 wrote: Sun Dec 15, 2019 11:41 am
neilpilot wrote: Sun Dec 15, 2019 11:39 am

If I was 50 y/o today I don't think I would start LTC coverage now given the state of the current LTCI market.

What do you mean by the "state of the current LTCi market"?
I have had no reason to shop since our policy started 20 years ago, but as I read posts in this thread and others I think premiums are way higher. Back in 1999 the underwriters vastly underestimated their LTC loss projections.

Our annual premiums for coverage that is currently at $750k each, $300/day nursing home or $140/day assisted living and a 3% annual inflation rider, is $800/yr.

What would you pay for that coverage in a policy you wrote today?

I wasn't sure what you meant by "state of the LTCi market".
Yes, policies today cost more than older policies because the Rate Stability Regulation requires that any new policy purchased today MUST include all prior rate increases. The purpose of the regulation is to force insurers to charge more accurate premiums and minimize the risk of future rate increases on these newer policies.
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JoeRetire
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Re: Long term Care Insurance

Post by JoeRetire »

michaeljc70 wrote: Sun Dec 15, 2019 10:53 am
JoeRetire wrote: Sun Dec 15, 2019 7:32 am Okay. So you have decided that you can afford to pay for your long term care. But you don't know how much that will be, nor have you given it much thought.

You said that you don't insure things that you can afford and that you plan to be able to afford your long term care. It actually sounds more like you've just chosen not to think about it. A lot of people take that approach.
Joe, I have no idea how much money I will have in 30 or 40 years. Do you know how much you will have then?
No, I don't know how much money I will have in 30 or 40 years. But I do know how much LTCi coverage I have. And I do know that the coverage increases 3% every year with no increase in premiums.
Based on family life expectancies, I could live another 44 years. I have no idea what healthcare will cost then let alone if I will need LTC. I'm not sure that I should be spending much time trying to figure out things that are impossible to figure out. I try to save, invest and spend wisely and I am happy where I am now and hope that that will continue in the future.
Hope is a good thing. You originally said that you plan to be able to afford LTC.

When purchasing insurance, most folks try to determine what financial risk they need to cover. You have decided that you will not purchase the insurance, but are now hoping you'll have enough money saved should a long term care situation arise, and you don't want to bother thinking about it. You aren't alone in taking that path.
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Re: Long term Care Insurance

Post by michaeljc70 »

JoeRetire wrote: Sun Dec 15, 2019 12:49 pm
michaeljc70 wrote: Sun Dec 15, 2019 10:53 am
JoeRetire wrote: Sun Dec 15, 2019 7:32 am Okay. So you have decided that you can afford to pay for your long term care. But you don't know how much that will be, nor have you given it much thought.

You said that you don't insure things that you can afford and that you plan to be able to afford your long term care. It actually sounds more like you've just chosen not to think about it. A lot of people take that approach.
Joe, I have no idea how much money I will have in 30 or 40 years. Do you know how much you will have then?
No, I don't know how much money I will have in 30 or 40 years. But I do know how much LTCi coverage I have. And I do know that the coverage increases 3% every year with no increase in premiums.
Based on family life expectancies, I could live another 44 years. I have no idea what healthcare will cost then let alone if I will need LTC. I'm not sure that I should be spending much time trying to figure out things that are impossible to figure out. I try to save, invest and spend wisely and I am happy where I am now and hope that that will continue in the future.
Hope is a good thing. You originally said that you plan to be able to afford LTC.

When purchasing insurance, most folks try to determine what financial risk they need to cover. You have decided that you will not purchase the insurance, but are now hoping you'll have enough money saved should a long term care situation arise, and you don't want to bother thinking about it. You aren't alone in taking that path.
I have thought about, and it is pretty clear, on average, investing premiums I will come out ahead. Insurance companies aren't in business to lose money over the long term. This is not much different than buying an annuity or keeping the money invested in your portfolio. The annuity guarantees something yet most people don't buy them.

About .5% of the population has LTC insurance. Obviously we wouldn't expect kids and young adults to have it, but it is still a very low percentage of people over 50. I read 11% of people over 65 have it. 5% of people age 55-60.
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JoeRetire
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Re: Long term Care Insurance

Post by JoeRetire »

michaeljc70 wrote: Sun Dec 15, 2019 12:58 pmI have thought about, and it is pretty clear, on average, investing premiums I will come out ahead. Insurance companies aren't in business to lose money over the long term. This is not much different than buying an annuity or keeping the money invested in your portfolio. The annuity guarantees something yet most people don't buy them.
It is interesting that you don't apply the same thought process to your car insurance premiums.
- on average investing those premiums would allow you to come out ahead
- auto insurance companies aren't in business to lose money
- your annuity analogy doesn't make much sense to me

People don't purchase insurance based on "the average". Otherwise, nobody would ever purchase insurance.

Anyway, I wish you luck. I hope you never need to use any insurance, nor suffer from the lack of it.
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Re: Long term Care Insurance

Post by michaeljc70 »

JoeRetire wrote: Sun Dec 15, 2019 1:04 pm
michaeljc70 wrote: Sun Dec 15, 2019 12:58 pmI have thought about, and it is pretty clear, on average, investing premiums I will come out ahead. Insurance companies aren't in business to lose money over the long term. This is not much different than buying an annuity or keeping the money invested in your portfolio. The annuity guarantees something yet most people don't buy them.
It is interesting that you don't apply the same thought process to your car insurance premiums.
- on average investing those premiums would allow you to come out ahead
- auto insurance companies aren't in business to lose money
- your annuity analogy doesn't make much sense to me

People don't purchase insurance based on "the average". Otherwise, nobody would ever purchase insurance.

Anyway, I wish you luck. I hope you never need to use any insurance, nor suffer from the lack of it.
No, I do apply it. I didn't lay it all out here is at isn't relevant. However, the average person will have 4 car accidents in their lifetime. I don't know anyone that drives that hasn't had an auto insurance claim in their lifetime. Do you see the difference?

I'm glad you are happy with your policy. I hope the premiums stay flat. It seems like you are adamant about something that the vast majority of Americans aren't. To each his own.
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JoeRetire
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Re: Long term Care Insurance

Post by JoeRetire »

michaeljc70 wrote: Sun Dec 15, 2019 1:22 pm No, I do apply it. I didn't lay it all out here is at isn't relevant. However, the average person will have 4 car accidents in their lifetime. I don't know anyone that drives that hasn't had an auto insurance claim in their lifetime. Do you see the difference?
No. Insurance is insurance.

More than 50% of people turning age 65 will need some type of long-term care services in their lifetimes.
I'm glad you are happy with your policy. I hope the premiums stay flat. It seems like you are adamant about something that the vast majority of Americans aren't. To each his own.
Not adamant at all. I like to try and understand how people come to their decisions.
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Small Savanna
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Re: Long term Care Insurance

Post by Small Savanna »

My wife and I have it, and I think it's a good hedge against one of the more likely scenarios that could seriously impact our retirement finances. If you can get a good policy at a reasonable premium I'd strongly recommend it. It's also worth reading through some of the older posts on this topic, for example:

viewtopic.php?f=2&t=291954
michaeljc70
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Re: Long term Care Insurance

Post by michaeljc70 »

JoeRetire wrote: Sun Dec 15, 2019 1:25 pm
michaeljc70 wrote: Sun Dec 15, 2019 1:22 pm No, I do apply it. I didn't lay it all out here is at isn't relevant. However, the average person will have 4 car accidents in their lifetime. I don't know anyone that drives that hasn't had an auto insurance claim in their lifetime. Do you see the difference?
No. Insurance is insurance.

More than 50% of people turning age 65 will need some type of long-term care services in their lifetimes.
I'm glad you are happy with your policy. I hope the premiums stay flat. It seems like you are adamant about something that the vast majority of Americans aren't. To each his own.
Not adamant at all. I like to try and understand how people come to their decisions.
Yes, but only 15% will incur more than $250,000 in costs.

I don't think insurance is insurance. There is insurance for all kinds of things. There are extended warranties which is a form of insurance. You can insure your golf swing, your smile and whether there will be 1 foot or more of snow on Xmas.
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JoeRetire
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Re: Long term Care Insurance

Post by JoeRetire »

michaeljc70 wrote: Sun Dec 15, 2019 1:32 pm
JoeRetire wrote: Sun Dec 15, 2019 1:25 pm
michaeljc70 wrote: Sun Dec 15, 2019 1:22 pm No, I do apply it. I didn't lay it all out here is at isn't relevant. However, the average person will have 4 car accidents in their lifetime. I don't know anyone that drives that hasn't had an auto insurance claim in their lifetime. Do you see the difference?
No. Insurance is insurance.

More than 50% of people turning age 65 will need some type of long-term care services in their lifetimes.
I'm glad you are happy with your policy. I hope the premiums stay flat. It seems like you are adamant about something that the vast majority of Americans aren't. To each his own.
Not adamant at all. I like to try and understand how people come to their decisions.
Yes, but only 15% will incur more than $250,000 in costs.
Okay. So are you putting aside $250,000 to cover the usual case? Or more, in case you are in the unlucky 15 percent?

Of the 4 car accidents you indicate the "average" person will have over their lifetime, how many of those will incur costs over $250,000, if that's an important factor for some reason?
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Re: Long term Care Insurance

Post by smitcat »

michaeljc70 wrote: Sun Dec 15, 2019 1:22 pm
JoeRetire wrote: Sun Dec 15, 2019 1:04 pm
michaeljc70 wrote: Sun Dec 15, 2019 12:58 pmI have thought about, and it is pretty clear, on average, investing premiums I will come out ahead. Insurance companies aren't in business to lose money over the long term. This is not much different than buying an annuity or keeping the money invested in your portfolio. The annuity guarantees something yet most people don't buy them.
It is interesting that you don't apply the same thought process to your car insurance premiums.
- on average investing those premiums would allow you to come out ahead
- auto insurance companies aren't in business to lose money
- your annuity analogy doesn't make much sense to me

People don't purchase insurance based on "the average". Otherwise, nobody would ever purchase insurance.

Anyway, I wish you luck. I hope you never need to use any insurance, nor suffer from the lack of it.
No, I do apply it. I didn't lay it all out here is at isn't relevant. However, the average person will have 4 car accidents in their lifetime. I don't know anyone that drives that hasn't had an auto insurance claim in their lifetime. Do you see the difference?

I'm glad you are happy with your policy. I hope the premiums stay flat. It seems like you are adamant about something that the vast majority of Americans aren't. To each his own.

"I'm glad you are happy with your policy. I hope the premiums stay flat"
Which of these common insurance premiums are likely to stay flat for a few years or more?
- Health
- disability
- home
- auto
- boat/RV
- life
- umbrella
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JoeRetire
Posts: 6673
Joined: Tue Jan 16, 2018 2:44 pm

Re: Long term Care Insurance

Post by JoeRetire »

smitcat wrote: Sun Dec 15, 2019 3:14 pm"I'm glad you are happy with your policy. I hope the premiums stay flat"
Which of these common insurance premiums are likely to stay flat for a few years or more?
- Health
- disability
- home
- auto
- boat/RV
- life
- umbrella
I hope they all stay flat. But I don't expect it from most of them.
It's the end of the world as we know it. | It's the end of the world as we know it. | It's the end of the world as we know it. | And I feel fine.
smitcat
Posts: 7009
Joined: Mon Nov 07, 2016 10:51 am

Re: Long term Care Insurance

Post by smitcat »

JoeRetire wrote: Sun Dec 15, 2019 3:17 pm
smitcat wrote: Sun Dec 15, 2019 3:14 pm"I'm glad you are happy with your policy. I hope the premiums stay flat"
Which of these common insurance premiums are likely to stay flat for a few years or more?
- Health
- disability
- home
- auto
- boat/RV
- life
- umbrella
I hope they all stay flat. But I don't expect it from most of them.
I agree - that was my point for Michael.
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2pedals
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Re: Long term Care Insurance

Post by 2pedals »

A few years ago after looking at the costs and what they cover, I have decided to not carry LTCi. The biggest issue I see is they are very expensive and limits on coverage are low. I could not find coverage that has very high wait periods (say 2 years) and very high benefit periods (say 10 years). I am looking for cheap insurance against rare long term events. I am not looking to fill the gaps on things that can be self insured.
Last edited by 2pedals on Sun Dec 15, 2019 9:24 pm, edited 1 time in total.
prd1982
Posts: 380
Joined: Sun Jan 08, 2017 4:43 pm

Re: Long term Care Insurance

Post by prd1982 »

smitcat wrote: Sun Dec 15, 2019 3:14 pm
"I'm glad you are happy with your policy. I hope the premiums stay flat"
Which of these common insurance premiums are likely to stay flat for a few years or more?
- Health
- disability
- home
- auto
- boat/RV
- life
- umbrella
I don't think would work with LTCi. The claim rate for 50 yr olds is way below people 70 yrs old. And people in their 70s are way below those in their 80s. So you would be looking at a major increase in premiums as you age. I can imagine unscrupulous sales people convincing people to purchase a policy in their 50s, knowing they would not be able to afford it when in their 80s and likely to use the insurance. I could agree that the policy could be increased at the rate of general inflation. But I don't think that is what the insurance companies want.
michaeljc70
Posts: 7389
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Re: Long term Care Insurance

Post by michaeljc70 »

smitcat wrote: Sun Dec 15, 2019 3:21 pm
JoeRetire wrote: Sun Dec 15, 2019 3:17 pm
smitcat wrote: Sun Dec 15, 2019 3:14 pm"I'm glad you are happy with your policy. I hope the premiums stay flat"
Which of these common insurance premiums are likely to stay flat for a few years or more?
- Health
- disability
- home
- auto
- boat/RV
- life
- umbrella
I hope they all stay flat. But I don't expect it from most of them.
I agree - that was my point for Michael.
My comment was based off of his comment:
JoeRetire wrote: Sun Dec 15, 2019 7:32 am I've never had my LTC insurance premiums go up. At all. Ever.
smitcat
Posts: 7009
Joined: Mon Nov 07, 2016 10:51 am

Re: Long term Care Insurance

Post by smitcat »

michaeljc70 wrote: Sun Dec 15, 2019 5:17 pm
smitcat wrote: Sun Dec 15, 2019 3:21 pm
JoeRetire wrote: Sun Dec 15, 2019 3:17 pm
smitcat wrote: Sun Dec 15, 2019 3:14 pm"I'm glad you are happy with your policy. I hope the premiums stay flat"
Which of these common insurance premiums are likely to stay flat for a few years or more?
- Health
- disability
- home
- auto
- boat/RV
- life
- umbrella
I hope they all stay flat. But I don't expect it from most of them.
I agree - that was my point for Michael.
My comment was based off of his comment:
JoeRetire wrote: Sun Dec 15, 2019 7:32 am I've never had my LTC insurance premiums go up. At all. Ever.
FWIW - Our LTCi insurance has gone up just about 15% in 12 years.
LeeMKE
Posts: 2005
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Re: Long term Care Insurance

Post by LeeMKE »

+1 WoW2012

I bought my LTCi at age 50. Premiums just started increasing at age 64. Since I opted for a 5% inflation rider, I'm still golden with the premium increases so far.

IMHO married couples need this insurance most. If/when one of you needs this kind of care, it is a burden many will find challenging to afford without impoverishing the other. Odds are good that one of you will use the coverage. Waiting a few years will make this coverage unaffordable, ergo many must self-insure.
The mightiest Oak is just a nut who stayed the course.
texasdiver
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Location: Vancouver WA

Re: Long term Care Insurance

Post by texasdiver »

Maybe I'm being very naive but my wife and I are basically dedicating our HSA towards long term care. I'm 55 and she is 48. We are maxing out the family HSA contribution each year and basically not touching it. Our provider has Vanguard funds available at no fee other than the underlying fund fee. I'm in VTWAX Admiral Shares and the only fee is the 0.10% fund fee. No separate HSA fees. With a reasonable rate of return we should have several hundred thousand in that account by the time my wife reaches retirement age (it's her account) and then it will just sit there and continue to accrue until we ever need it. At an 8% annual return we will have about $488,000 in the account when she retires if we don't touch it before then. And over $1 million if we don't touch it until we are in our 80s. If we don't end up using it our heirs get it all. Yes, they'll get hammered by taxes but that's not my problem and honestly, still better than if we had dumped the money into a LTC policy all those years instead and they got nothing.
krafty81
Posts: 340
Joined: Thu Jul 05, 2018 2:01 pm
Location: San Diego, CA

Re: Long term Care Insurance

Post by krafty81 »

My Dad is now executing his LTC policy from CNA. He has memory issues which will get worse, he may live another 10 years. Very happy with the company and the policy, as his care could exceed 200K per year. My spouse and I both have LTCi and are very happy we do. Hybrid policies have huge up front costs and are not worth it IMO.
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sergeant
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Re: Long term Care Insurance

Post by sergeant »

I spent hundreds of hours learning everything I could about LTC. As our portfolio and pension payouts grew and grew it became evident that we could self-insure. As the years passed and I was a couple years from retirement (age 51) I purchased policies for the two of us. It was a no-brainer, excellent policy at an affordable price. My reasoning for the purchase was as an inheritance protector.

Six years later, four retired, all is great. No price increases though the original 5% inflation was lowered to 3% last year. Our policy has no payout limit. We pay about $2500 a year for the two policies. Policy must be purchased while an active duty police or fire.
AA- 20+ Years of Expenses Fixed Income/The remainder in Equities.
marcopolo
Posts: 3875
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Re: Long term Care Insurance

Post by marcopolo »

sergeant wrote: Mon Dec 16, 2019 10:34 pm I spent hundreds of hours learning everything I could about LTC. As our portfolio and pension payouts grew and grew it became evident that we could self-insure. As the years passed and I was a couple years from retirement (age 51) I purchased policies for the two of us. It was a no-brainer, excellent policy at an affordable price. My reasoning for the purchase was as an inheritance protector.

Six years later, four retired, all is great. No price increases though the original 5% inflation was lowered to 3% last year. Our policy has no payout limit. We pay about $2500 a year for the two policies. Policy must be purchased while an active duty police or fire.
unlimited payout for $2500 a year!?!

That sounds more like a really nice fringe benefit from your job, rather than insurance one would buy on their own. Nice, if you can get it. Well done!
Once in a while you get shown the light, in the strangest of places if you look at it right.
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sergeant
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Location: The Golden State

Re: Long term Care Insurance

Post by sergeant »

marcopolo wrote: Mon Dec 16, 2019 10:45 pm
sergeant wrote: Mon Dec 16, 2019 10:34 pm I spent hundreds of hours learning everything I could about LTC. As our portfolio and pension payouts grew and grew it became evident that we could self-insure. As the years passed and I was a couple years from retirement (age 51) I purchased policies for the two of us. It was a no-brainer, excellent policy at an affordable price. My reasoning for the purchase was as an inheritance protector.

Six years later, four retired, all is great. No price increases though the original 5% inflation was lowered to 3% last year. Our policy has no payout limit. We pay about $2500 a year for the two policies. Policy must be purchased while an active duty police or fire.
unlimited payout for $2500 a year!?!

That sounds more like a really nice fringe benefit from your job, rather than insurance one would buy on their own. Nice, if you can get it. Well done!
Thanks. The strange thing is that less than 2% of retiring officers/fire actually purchase the policy. Some come back years after retiring asking if they can purchase but by then it's too late. Policy has to be bought a year prior to retiring.
AA- 20+ Years of Expenses Fixed Income/The remainder in Equities.
marcopolo
Posts: 3875
Joined: Sat Dec 03, 2016 10:22 am

Re: Long term Care Insurance

Post by marcopolo »

sergeant wrote: Mon Dec 16, 2019 10:52 pm
marcopolo wrote: Mon Dec 16, 2019 10:45 pm
sergeant wrote: Mon Dec 16, 2019 10:34 pm I spent hundreds of hours learning everything I could about LTC. As our portfolio and pension payouts grew and grew it became evident that we could self-insure. As the years passed and I was a couple years from retirement (age 51) I purchased policies for the two of us. It was a no-brainer, excellent policy at an affordable price. My reasoning for the purchase was as an inheritance protector.

Six years later, four retired, all is great. No price increases though the original 5% inflation was lowered to 3% last year. Our policy has no payout limit. We pay about $2500 a year for the two policies. Policy must be purchased while an active duty police or fire.
unlimited payout for $2500 a year!?!

That sounds more like a really nice fringe benefit from your job, rather than insurance one would buy on their own. Nice, if you can get it. Well done!
Thanks. The strange thing is that less than 2% of retiring officers/fire actually purchase the policy. Some come back years after retiring asking if they can purchase but by then it's too late. Policy has to be bought a year prior to retiring.
Feelings of invincibility is probably pretty common at their retirement age.

You were wise to jump on that opportunity.
Once in a while you get shown the light, in the strangest of places if you look at it right.
nclion
Posts: 49
Joined: Sun Nov 19, 2017 12:43 pm

Re: Long term Care Insurance

Post by nclion »

LTC is the one thing that I don't have a good feeling about as I near retirement. I have looked at insurance through work as a Fed, but I just don't like the cost of premiums vs. what you actually get in coverage. I also don't like the horror stories of those who try to collect after years of faithfully paying their premiums. That is why I have decided to just try to self insure even though I know our nest egg may not be enough for one or both of us if we need LTC for an extended period of time.
nclion
Posts: 49
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Re: Long term Care Insurance

Post by nclion »

Just out of curiosity, I ran some quick numbers at the Feds LTC site for a 63 year old to purchase coverage today with a inflation protection of 3%. I focused on the lifetime benefit, the max the insurance would pay vs. investing the premium to self insure. Now I guess I need to run these numbers through a investment calculator to see where the break even point is.

Lifetime Benefit Premium Payment Benefit Amount Benefit Period


$109,500.00 $168.91 monthly 150/day 2 years


$164,250.00 $247.71 monthly 150/day 3 years


$219,000.00 $330.28 monthly 200/day 3 years


$365,000.00 $489.79 monthly 200/day 5 years
WoW2012
Posts: 736
Joined: Sun Dec 23, 2012 11:28 am

Re: Long term Care Insurance

Post by WoW2012 »

nclion wrote: Tue Dec 24, 2019 10:02 am LTC is the one thing that I don't have a good feeling about as I near retirement. I have looked at insurance through work as a Fed, but I just don't like the cost of premiums vs. what you actually get in coverage. I also don't like the horror stories of those who try to collect after years of faithfully paying their premiums. That is why I have decided to just try to self insure even though I know our nest egg may not be enough for one or both of us if we need LTC for an extended period of time.

For healthy married couples, the group long-term care policy with the federal gov't is not the best value. Plus the fed program does not protect assets through any of the state "Long Term Care Partnership Programs" and the fed program is not under the Rate Stability Regulation.
WoW2012
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Re: Long term Care Insurance

Post by WoW2012 »

nclion wrote: Tue Dec 24, 2019 10:31 am Just out of curiosity, I ran some quick numbers at the Feds LTC site for a 63 year old to purchase coverage today with a inflation protection of 3%. I focused on the lifetime benefit, the max the insurance would pay vs. investing the premium to self insure. Now I guess I need to run these numbers through a investment calculator to see where the break even point is.

Lifetime Benefit Premium Payment Benefit Amount Benefit Period


$109,500.00 $168.91 monthly 150/day 2 years


$164,250.00 $247.71 monthly 150/day 3 years


$219,000.00 $330.28 monthly 200/day 3 years


$365,000.00 $489.79 monthly 200/day 5 years

If you're going to calculate future values, don't you think you should calculate how much the benefits will be due to the guaranteed growth from the 3% compound inflation protection?
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