Long Term Care

Long Term Care Insurance (LTC) is designed to protect individuals from the high expense of care in Skilled Nursing, Intermediate and Custodial Care facilities. It may also include Home Health care. It has been recognized as an important piece of financial planning for the protection of assets. Individuals mid-50’s onward are the usual interested parties but Long Term Care insurance is sold by some insurance companies as early as age 45. Premiums increase as an individual ages so it can be prudent to buy it early. One in 4 people who make age 60 will use Long Term Care facilities and the percentage increase dramatically as one ages.

Long term care is heavily underwritten. Medical records are obtained and carefully reviewed. Long Term Care policies are triggered (activated) by “activities of daily living” (adl’s). Usually three activities of daily living must apply for a policy to kick in. ADL’s include:

Cognitive awareness is the only trigger that works by itself. Cognitive awareness includes different forms of senile dementia and Alzheimer’s disease.

LTC is purchased in $10/day increments (e.g. $100/day will equal $3000/month in a 30 day month). Facilities can run as high as $5-6,000.00 a month in Northern California and may be more expensive in urban areas. LTC comes with a variety of riders that should be carefully considered before purchase. Home Health Care is designed to pay for care in your own home and is extremely important to consider.

LTC is very complicated and confusing. A knowledgeable and certified agent is a must for this line of insurance