Anyone Here Have Long Term Care Insurance?

[DETRoadster]

WA State just enacted mandatory long term care insurance for all residents. You either secure your own policy, or, you automatically get enrolled in a WA State sponsored program. The state program has some benefits in that they cant boot you out for health conditions and your premiums dont go up as you get older. The downside is that coverage is limited and if you leave WA State to retire elsewhere you lose all benefits.

it all got me thinking. The wife and I have life insurance in case one of us dies. We also have long term disability insurance in case we cant work. What we dont have is long term care insurance to help fund the costs of just plain getting old. My side of the family lives well into the 90s where as my wife's side seem to collapse in their late 70s/early 80s. We have no kids and never will. So the chance that I find myself old and alone at some point is very high. The chance my wife has some crippling illness that requires more care than an elderly me can provide is also high. Having some insurance to help ease the costs of care seems like a smart move, especially since we are mid 40s now so the cost of locking in is still low.

So how about it? Anyone here have a LTC policy? What knowledge and wisdom can you share?

[kscarrol]

Following. My advisor has suggested it but we've put it off. We do have two sons to change our diapers as we get older though!

[6oclockshadow]

If you have significant assets (any real estate, investments, etc.,) you should seek the help of an estate planner. A LTC policy is one aspect. Lots of other aspects to protect the two of you and the survivor. It's worth the cost. Check out NAFEP.com - National Association of Finance and Estate Planning. There are some good resources there.

[DETRoadster]

Originally Posted by 6oclockshadow

If you have significant assets (any real estate, investments, etc.,) you should seek the help of an estate planner. A LTC policy is one aspect. Lots of other aspects to protect the two of you and the survivor. It's worth the cost. Check out NAFEP.com - National Association of Finance and Estate Planning. There are some good resources there.

Thanks but I prefer to get my advice for free from random internet "experts" in the off-topic section of a car forum.

Yeah, you're totally right. We have a portfolio manager, an accountant, and a lawyer but they are all looking for for the "now." An estate planner who can help fine tune our exact situation and plan for the future is missing and would be helpful. I'll start looking into that.

[unluky]

My FP has that factored into my long term plan - including final 4 years of in home 24/7 care - but I don't carry any coverage on it......yet.

[exE36M3]

We looked into this about 5 years back, wife and I early 50s.
Long term care from Allstate was like $700/mo now for 5 years of care based on NorCal rates.

Yeah, kinda pricey!!

CA supposedly is a good state to get sick and old in because of Medicare which the state helps fund.
But it's stupidly expensive to just live a normal life here.

[6oclockshadow]

Originally Posted by exE36M3

We looked into this about 5 years back, wife and I early 50s.
Long term care from Allstate was like $700/mo now for 5 years of care based on NorCal rates.

Yeah, kinda pricey!!

CA supposedly is a good state to get sick and old in because of Medicare which the state helps fund.
But it's stupidly expensive to just live a normal life here.

The older you are, the more costly the premiums. Get this type of insurance in your early 40's.

[wdb]

We got LTC insurance about 5 years ago, both in our 60s and after my wife had a brush with cancer. Definitely should have done it sooner. My premium (male) is ~$1.5K/yr and my wife's is ~$4K/yr. We think it's worth it; just look at the cost of a single month in a nursing home! Without something to stop them they can bleed your life savings down to nearly nothing.

We went with Northwestern Mutual. The other one that was recommended to us was Mutual of Omaha. You have to be extra careful who you sign up with because a whole bunch of insurers have bailed out on their LTC coverage and left people stranded. (I personally would be very suspect of the state-run plan, but that's me.)

There are a boatload of options to consider as well such as waiting period, coverage amount, max limit, yada yada. Our advisor said "you can buy a compact, a sedan, or a luxury car -- buy the sedan." That's what we did. We chose plans that leave us on the hook for the first 6 months, and pick up from there. It's a balance between the cost of the premium and the amount of risk/cost you are willing to assume.

Oh yeah -- find something that has clauses for things besides nursing home costs. In-home care and other alternatives are gaining popularity. Make sure your plan will help you pay for them.

[DETRoadster]

Originally Posted by wdb

We got LTC insurance about 5 years ago, both in our 60s and after my wife had a brush with cancer. Definitely should have done it sooner. My premium (male) is ~$1.5K/yr and my wife's is ~$4K/yr. We think it's worth it; just look at the cost of a single month in a nursing home! Without something to stop them they can bleed your life savings down to nearly nothing.

We went with Northwestern Mutual. The other one that was recommended to us was Mutual of Omaha. You have to be extra careful who you sign up with because a whole bunch of insurers have bailed out on their LTC coverage and left people stranded. (I personally would be very suspect of the state-run plan, but that's me.)

There are a boatload of options to consider as well such as waiting period, coverage amount, max limit, yada yada. Our advisor said "you can buy a compact, a sedan, or a luxury car -- buy the sedan." That's what we did. We chose plans that leave us on the hook for the first 6 months, and pick up from there. It's a balance between the cost of the premium and the amount of risk/cost you are willing to assume.

Oh yeah -- find something that has clauses for things besides nursing home costs. In-home care and other alternatives are gaining popularity. Make sure your plan will help you pay for them.

Excellent advice. Thank you!

[3.0L]

Oops, I thought you meant long-term car insurance.

[Captain Blood]

Originally Posted by wdb

We got LTC insurance about 5 years ago, both in our 60s and after my wife had a brush with cancer. Definitely should have done it sooner. My premium (male) is ~$1.5K/yr and my wife's is ~$4K/yr. We think it's worth it; just look at the cost of a single month in a nursing home! Without something to stop them they can bleed your life savings down to nearly nothing.

We went with Northwestern Mutual. The other one that was recommended to us was Mutual of Omaha. You have to be extra careful who you sign up with because a whole bunch of insurers have bailed out on their LTC coverage and left people stranded. (I personally would be very suspect of the state-run plan, but that's me.)

There are a boatload of options to consider as well such as waiting period, coverage amount, max limit, yada yada. Our advisor said "you can buy a compact, a sedan, or a luxury car -- buy the sedan." That's what we did. We chose plans that leave us on the hook for the first 6 months, and pick up from there. It's a balance between the cost of the premium and the amount of risk/cost you are willing to assume.

Oh yeah -- find something that has clauses for things besides nursing home costs. In-home care and other alternatives are gaining popularity. Make sure your plan will help you pay for them.

The best life policy with a living benefits type rider to cover long-term care is a company called United Life if you want a whole life policy. American National and Foresters life also have great LB benefits Attached to term policies

[RickFLM4]

We met with someone from NY Life a few years back (about 50 y/o). There are different types of programs so there is a lot to digest. In some cases, you and your spouse can share benefits (e.g. I die before using mine, my wife gets my benefit + her’s). In others you tell them the benefit you want and that will determine the rate, or vice versa - tell them how much you want to pay and they will tell you the benefit you will be entitled to receive.

Overall, my takeaway is that you are basically buying a fixed amount of coverage for a cost that is not locked in, as premiums can increase. Ultimately, we decided against it for two reasons. First, if disciplined, you can self fund, given this is something with a fixed benefit and inevitably there is a huge commission involved. Secondly, I was not comfortable with the idea of paying into something for 20 years and then facing the possibility of having rates spike somewhere down the road. Additionally, my wife has a bad knee and we were going to need physical exams, so the agent told us they might up the price from what he quoted, providing the final nail in the coffin.

The other thing to bear in mind if you do it is to make sure you are working with a financially stable insurer. Paying in a bunch of years and having the insurer go bankrupt would be a disaster.

[wdb]

Originally Posted by RickFLM4

Overall, my takeaway is that you are basically buying a fixed amount of coverage for a cost that is not locked in, as premiums can increase. Ultimately, we decided against it for two reasons. First, if disciplined, you can self fund, given this is something with a fixed benefit and inevitably there is a huge commission involved. Secondly, I was not comfortable with the idea of paying into something for 20 years and then facing the possibility of having rates spike somewhere down the road. Additionally, my wife has a bad knee and we were going to need physical exams, so the agent told us they might up the price from what he quoted, providing the final nail in the coffin.

The other thing to bear in mind if you do it is to make sure you are working with a financially stable insurer. Paying in a bunch of years and having the insurer go bankrupt would be a disaster.

The increasing premium advice is very good. This is what happened to my parents, who bought LTC insurance when it was very popular to do so and every Tom/Dick/Harry company was selling it. They went with a very well known company, which nevertheless completely misread the market and ended up constantly jacking up their premiums. (Dad got me involved and we rejiggered things to fit their needs better, got the premium back down into earth's atmosphere.) That is another advantage of the two companies I mentioned; neither has raised their premiums in many, many, many years. They got the actuarial tables right from the beginning.

As for self-funding, yeah I guess, up to a point. My wife's grandmother was in a nursing home for 8 years. I don't want to self-fund that.

[RickFLM4]

Originally Posted by wdb

The increasing premium advice is very good. This is what happened to my parents, who bought LTC insurance when it was very popular to do so and every Tom/Dick/Harry company was selling it. They went with a very well known company, which nevertheless completely misread the market and ended up constantly jacking up their premiums. (Dad got me involved and we rejiggered things to fit their needs better, got the premium back down into earth's atmosphere.) That is another advantage of the two companies I mentioned; neither has raised their premiums in many, many, many years. They got the actuarial tables right from the beginning.

As for self-funding, yeah I guess, up to a point. My wife's grandmother was in a nursing home for 8 years. I don't want to self-fund that.

The way I looked at it, at least based on what was being sold to us, was that if there is a fixed / capped benefit, they should be able to calculate a fixed premium because it is really just a long-term savings / investment vehicle. The agent said they haven't raised rates in many years but I just couldn't get my head around the exposure to future increases, likely when we could least afford to tolerate them (after retirement). There were some options where I could make a lump sum contribution upfront, but then I'm back to "what is this really doing for me"?

As far as being in a nursing home for 8 years, I doubt any of the policies I reviewed would provide enough coverage for 8 years. Benefits ended once consumed. They weren't like health insurance with no cap. I'm sure you can buy policies for more coverage, but the cost would be very high.

[Run Silent]

Originally Posted by DETRoadster

Excellent advice. Thank you!

WBD's details are in line with what I've understood. They other comments I've seen - is to avoid LTC insurance until you are quite a bit older. The cost is very high, and the premiums don't jump dramatically as you get older. i.e. you could pay $400/mo when you are in your 40's or $900/mo when you are in your late 60's. If you do the math and factor in investment return losses, typically it is financially smarter to grab it when you are older.

Standard nursing home rates can easily exceed $50,000 a year, so it's worth having if you don't have a large nest egg.

Something else to consider - the average time a person is in a nursing home in the USA is about 14mos.

https://www.ucsf.edu/news/2010/08/98...eight%20months.

This is important to consider - because you can quickly exceed total premium expense being more than the expected benefit.

[Joekerr]

At the end of the day, insurance companies are for profit companies, not not for profit companies. They sell a product that on average, will make them money (and a fair bit of it generally).

That's generally my outlook when it comes to anything with insurance. And then I look at the risk, the timing, and decide whether I want to mitigate the risk through insurance, through something I do, or whether the risk is acceptable, in which case I do nothing.

[DETRoadster]

Originally Posted by Run Silent

WBD's details are in line with what I've understood. They other comments I've seen - is to avoid LTC insurance until you are quite a bit older. The cost is very high, and the premiums don't jump dramatically as you get older. i.e. you could pay $400/mo when you are in your 40's or $900/mo when you are in your late 60's. If you do the math and factor in investment return losses, typically it is financially smarter to grab it when you are older.

Standard nursing home rates can easily exceed $50,000 a year, so it's worth having if you don't have a large nest egg.

Something else to consider - the average time a person is in a nursing home in the USA is about 14mos.

https://www.ucsf.edu/news/2010/08/98...eight%20months.

This is important to consider - because you can quickly exceed total premium expense being more than the expected benefit.

Well there's someone I haven't seen in ages. I was just thinking about you the other day when I saw an Alfa drive by and wondering how you are. Hope all is well!

Great advice as always. Thank you.

I think what maybe I didnt stress enough in my first post is that I am REQUIRED () to buy a long term care policy. My only option would be to leave the state of Washington. So my choice is to buy into the state sponsored plan at about $500 a year, or, procure my own policy. Hell of a choice, eh?

[RickFLM4]

Originally Posted by DETRoadster

Well there's someone I haven't seen in ages. I was just thinking about you the other day when I saw an Alfa drive by and wondering how you are. Hope all is well!

Great advice as always. Thank you.

I think what maybe I didnt stress enough in my first post is that I am REQUIRED () to buy a long term care policy. My only option would be to leave the state of Washington. So my choice is to buy into the state sponsored plan at about $500 a year, or, procure my own policy. Hell of a choice, eh?

$500/year is much, much less expensive than you will pay for a private policy. I’d shop around and see if there is a product you like without regard to mandates. If there is, great - get it. If not, pay the $500 / year and think of it as an extra tax that may or may not provide a benefit down the road. It’s not much to throw away if you decide to leave the state.

Not sure what benefits the state plans on paying but $500 / year sounds like they are about to dig a crater in the long-term state budget.

[RMachuca3d]

Through work we are getting a much much much better deal as opposed to the state offered option, just sucks that i'm forced to pay into such a plan when i could end up in another country at the drop of the hat, and loose all that money that was poured into it.

[Joe T]

My wife has looked into it for me, we've decided when i get bad to either put me on my motorcycle and glue my hand to the throttle or put a pillow over my head

she on the other hand is too mean to get old or sick

[Run Silent]

Originally Posted by DETRoadster

Well there's someone I haven't seen in ages. I was just thinking about you the other day when I saw an Alfa drive by and wondering how you are. Hope all is well!

Great advice as always. Thank you.

I think what maybe I didnt stress enough in my first post is that I am REQUIRED () to buy a long term care policy. My only option would be to leave the state of Washington. So my choice is to buy into the state sponsored plan at about $500 a year, or, procure my own policy. Hell of a choice, eh?

Just as Rick says below your last post - I would just look at it like a tax. $500 a year is a fraction of what it normally costs. I would just come to grips that your taxes increased $500 this year and going forward and move on. Later on, you can relook at it as you near retirement to see what the best option is.

Don't get me started on the government forcing you to buy a product just because you exist! You know my political stance!

Otherwise - hope all is well, sir! Hit me up on PM if you wanna chat further.

Take care and stay safe!

[DETRoadster]

Originally Posted by RickFLM4

$500/year is much, much less expensive than you will pay for a private policy. I’d shop around and see if there is a product you like without regard to mandates. If there is, great - get it. If not, pay the $500 / year and think of it as an extra tax that may or may not provide a benefit down the road. It’s not much to throw away if you decide to leave the state.

Not sure what benefits the state plans on paying but $500 / year sounds like they are about to dig a crater in the long-term state budget.

Our CFO passed on a 3rd party option to me that he investigated for himself. He's my age and demographic and was quoted $800 a year. But it was a weird "off-brand" company Ive never heard of.

I've got till November to decide so I'll do some shopping around and talk to our portfolio manager. My folks (who just retired) have an estate/retirement planner so I think I'll sync up with her as well to get another data point/opinion. But it's really sounding like I'll probably just suck up the $500 a year for a while as an added tax, then drop the state plan and pick up an independent one when I'm closer to retirement.

Thanks again all for the great input!