30 Second Insurance Tips©

Tip #330- Have They Got It Right Now?

“It” in this case, is premiums for long term care insurance.
The cover story of the October issue of Consumer Reports is a lengthy feature on “elder care.”  I highly recommend you find a copy. (For a cold beer, I’ll share mine!)
Included is a section describing the Long Term Care Insurance industry “makeover.” Here are a couple of highlights:
  • Insurers apparently have learned from past pricing mistakes; new policies can be costly (average $2,727/yr.) but the risk of premium increases “has never been this low.” (Later in the article however, it still recommends budgeting for future increases.).
  • Short Term Care Insurance” is far more affordable; e.g., a $928 annual premium at age 65 buys a $150 per day benefit paid for just 360 days. (Is something better than nothing?)
  • Hybrid life insurance policies – with a Long Term Care rider – are the most stable premium of all. Missing however are some of the tax benefits of traditional Long Term Care coverage.
One more snippet from the article: “more than half (OMG!) of today’s 65 year olds will require long term care at some point, at an average cost of $138,000.”