A recent on-line column at Advisors Perspective attempts to provide an objective framework for conducting a long term care insurance analysis in a financial planning practice. It fails on several levels.
The article, “Evaluating Long-Term Care Insurance”, published February 24, 2020, and written by Allan Roth is hardly a comprehensive view of the subject, and it needs to be viewed with limited applicability.
I find it to be only partially researched, inconsistently analyzed, and overly opinionated.
Too many financial advisors inappropriately seek to value insurance products using an investment analysis model. While there are certainly cash-flow and cost of money considerations, as noted above insurance is purchased with an expectation of “losing” a little in exchange for potentially protecting a lot. And there are “soft”, subjective considerations that are also routinely ignored, but that often create the biggest value in having coverage when the risk event occurs.
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