If an insurance agent tells you to replace your long-term care (LTC) insurance, be careful! Take your time. Get a second opinion. It's probably a mistake, and the agent pushing a replacement may be breaking the law.
It is almost NEVER a good idea to replace an in-force LTC insurance policy.
We are hearing stories almost daily of unscrupulous agents urgently telling their clients to immediately replace their in-force long-term care (LTC) insurance for a variety of reasons, all bad:
This is a fun ... and serious read about the importance of planning ahead for extended care (long-term care) needs! The five points:
Here is the link to the full article:
And remember, a little chocolate always helps!
China Oceanwide will buy Genworth in a $2.7-billion deal which includes a $1.1-billion capital commitment to pay off debt and invest in the US life insurance business.
“China Oceanwide is also aligned with Genworth’s long-term goals of serving the aging population in the U.S., and providing financial capabilities to those seeking home ownership.”
I believe this is good news for Genworth policyholders and the LTC insurance marketplace overall. Readers should note that two other active LTC insurers are also now foreign-owned. John Hancock is owned by the Canadian insurance company Manulife, and Transamerica is owned by Dutch insurer AEGON.
The US life & LTC biz must and will remain a US-based subsidiary of China Oceanwide, subject to US federal and state regulators. In-force policies must all be honored by law.
Click here for a link to the company's full press release:
As an insurance broker who has sold LTC insurance since 1992, and who has focused exclusively on LTC insurance since 2000, I have been following the FLTCIP rate increase news since it is such a large player in the marketplace. The "average" increase for current policyholders is over 80%, with some as high as 125%!
Here's my take: Welcome to LTC insurance.
The FLTCIP is basically having to realize the same increases, for the same reasons as the rest of the private LTC insurance marketplace. 125% is NOT an outlier. Several other companies including some of John Hancock's individual policies, and Genworth’s have had 80%-100%+ increases. Others have had those amounts as well cumulatively over 2 or 3 increases in the past 10 years ..........
Another story that confuses "independent living" with long-term care
This was an interesting article about alternative retirement living up until the author started comparing it to assisted living and nursing homes. (Link to full CNBC article at the end of this post.)
The only reasonable land-based analogy here is "independent living". Even mentioning assisted living, or worse nursing homes, is completely ridiculous. While a cruise ship is staffed for "medical care" that means, acute, temporary medical conditions, not long-term, custodial care. NO cruise ship will provide help for you to physically get out bed, bathe, dress, etc., the types of basic care services provided in assisted living. And NO cruise ship wants a long-term passenger with safety issues related to Alzheimer's or dementia. And if you're so poor off to be in a skilled nursing home, you probably can't even get on the ship.
Here is a quote from today's CNBC article:
A study published in the Journal of the American Geriatrics Society found that when considered over a 20-year span, "cruises were comparably priced to assisted living centers and offered a better quality of life, "though land-based assisted living can vary greatly by facility, location and needs."
And here's a quote from the source article linked in the quote above (published in 2004!), that itself is quoting an article (from 2004!) in a medical journal:
"Elderly people often choose assisted living facilities, nursing homes, 24 hours a day home caregivers, or family support. Living on a cruise ship might be a better choice, says Lee Lindquist, instructor of medicine at Northwestern University's Feinberg School of Medicine in Chicago, and a geriatrician at Northwestern Memorial Hospital."
Dr. Lindquist should lose her (his?) license, hospital privileges, and teaching post. While there are indeed people with canes, walkers, and wheelchairs on cruise ships, NONE of them are living there. And who is it helping them bathe and dress and use the toilet on board? Right, spouses or other family. If someone needs the degree of care provided in assisted living, they cannot "live" on a cruise ship. MAYBE they could take a vacation, but the ship's staff sure as heck is not going to provide any direct care services.
BTW, getting "long-term care" in a Holiday Inn is just as ridiculous.
Follow this link to the full article on-line:
Another article on the high cost of health care in retirement, and again, these numbers all exclude the cost of long-term care.
The Motley Fool does a good job of examining a couple of different studies on what we should expect to pay out of pocket for health care in retirement, and how even with estimates exceeding $240,000 over a 20-year retirement we may still be UNDER-estimating the cost.
MOST of the costs are monthly premiums for Medicare Part B and Medicare Supplement insurance, plus an average of Medicare deductibles and co-payments.
None of the studies cited include the cost of long-term care services.
The Fool's advice:
This is a well-done article that lays out facts and ways to approach the planning issues without relying on scare tactics.
Read the full article on-line by clicking HERE.
It's not about the car keys ... it's about the money.
New research suggests that aging parents have a "toxic combination" of low, or diminished, financial literacy but a high degree of confidence.
"In short, the more disconnected the seniors became from reality, the more they believed they could do a grand job making decisions about their money and investments."
Here's an excerpt from a Money magazine article about the cost of health care in retirement, and again, it is noted that the staggering numbers DO NOT include long-term care costs.
"Total retirement health care expenses for that 45-year-old couple planning to retire at age 65 will come to $592,275 in today’s dollars and $1.6 million in future dollars ... "
Click here for a link to the full article:
For about $160 a month that same 45-year-old couple can buy a LTC insurance policy that covers up to $432,000 of long-term care costs at age 69.
UNUM announced its latest in-force premium increase on two of its LTC insurance blocks of business impacting policyholders in 21 states. (MO & IL have not yet approved this increase.)
Inflation option to avoid the increase:
Like any LTC insurance policy, the premium can be reduced by reducing benefits, for example, changing from a "Lifetime" benefit period to 6-years, or from 6-years to 3 years; policyholders can also reduce the amount of coverage per month.
UNUM is offering a special option with this increase:
ComfortLTC recommends most policyholders should elect the reduced, 3% inflation option.
If your health is in decline and you may file a claim soon, you may want to consider accepting the full increase.
You are not affected if:
There are state differences (a lower approved increase percentage, or increases spread out over three years). The states currently impacted are:
AK, AZ, CO, IA, KS, MI, NC, NJ, NV, NY, OH, OK, OR, SC, SD, TN, TX, UT, WI, WV, WY
Call your agent; or contact us for a personalized policy review and recommendation.
Chicago Tribune financial columnist Terry Savage has some good basic information on LTC insurance and why to buy.
Click here for the link to go to the article:
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