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LTC Insurance Today Is Different Than Yesterday
Jan L. Warner & Jan Collins

Question: Thanks for your recent article entitled "Long-term care insurance comes up short". It seems that I have been hounded by every insurance agent in the world to purchase this insurance. Yet I've been unable to find anyone who can say if it is appropriate for me. I have gone to the so-called “experts” at the senior citizen center for help, but they have been totally useless. I just turned 69 and know that premiums will squeeze my already-tight budget. I'd appreciate any suggestions you might have.

Answer: In the past 100 years or so, Americans’ life expectancies have increased dramatically. Those of us who live to age 85 today are expected to live, on average, another six to seven years. And, since aging is generally accompanied by medical problems, many seniors are forced to seek some type of long-term care during their lifetimes.

While most care still comes from family and other caregivers at home, with the economy driving more family members into the workplace to try to make ends meet, they don't have as much time to spend with elderly family members. Accordingly, more seniors are seeking outside care alternatives that range from adult day care to assisted living to intermediate and skilled nursing care. But as the degree of care increases, so does the cost. So, seniors in today's uncertain world find themselves pondering the purchase of long-term care insurance, an entirely different type of coverage than our parents ever thought about. Moreover, a growing number of seniors who purchased the more restrictive coverage of the past are finding out that they didn't buy enough coverage or aren't covered for some levels of care.

The long-term care insurance product of today is much better than it was 10 to 15 years ago. More long-term-care salespeople are specialists, too, who are more knowledgeable than before. Still, today's the market place is confusing, with more than 130 companies and many different types of policy language to choose from.

That said, whether or not to purchase long-term care insurance involves balancing your assets, income, and needs to determine if the level of coverage you require is affordable. Your decision should not be made in a vacuum, but as part of a coordinated plan that includes input from experienced and properly trained insurance salespeople and experienced elder law attorneys. We believe that the planning process should include consideration of such factors as your marital status, your household income, the extent and character of your assets (IRA’s, annuities, real estate, stocks, etc.), whether your assets can be easily liquidated should you need them to pay for your care, the tax consequences of liquidation, and whether you can afford to spend from $2,500 for assisted living to $7,000 for nursing home care each month without sacrificing the standard of living of your spouse, if you have one.

The cost of the coverage increases as you age. Some seniors have medical problems that preclude coverage. Others with medical problems can still be underwritten, but at a greater premium cost. If husband and wife both purchase the coverage, there are generally discounts available. If one spouse can't get coverage, the question still remains whether the other should purchase coverage. While those with comparatively few assets and minimal income generally cannot afford and should not purchase long-term care coverage, some still purchase the coverage to avoid dependency in the future.

Bottom Line: Our parents purchased life insurance to protect each other and to be able to pass on assets to us. While this is noble, many seniors are looking at self-preservation and the ability to withstand a significant cash drain should care be necessary. That’s why coverage for home care, assisted living, and nursing home care is an important ingredient that everyone should consider. Some states have even integrated long-term care policies with Medicaid qualification. More on this topic can be found at

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Planning Your Future with 20-20 Vision™

Today, more than 36 million Americans are age 65 or over. There are more than 22 million family-member caregivers. Then there are the Baby Boomers. All are grappling with the major decisions that accompany the latter stages of life. This book is for them. Written by two experts with decades of experience between them, it is a comprehensive guide that instructs readers about how to create a plan to deal with all aspects of aging, helps maximize options and ensure wishes are carried out.

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