Long-Term Care Insurance is a way to protect your assets in case you or a loved one needs care.  It helps pay for care in your own home, in an assisted living, or in a skilled care facility.

Many people purchase insurance to protect their assets, however, the insurance also provides peace of mind.  Most people do not want to be a burden on their family when the time arises when care is needed.  Those who plan ahead will have a smoother transition for their family and for themselves. It provides a clear understanding of where care will come from,  who is responsible, and how it will be paid. 

Long-Term care insurance provides many benefits. The insurance carrier usually provides a care coordinator who helps the family decide the type of care that is needed and helps coordinate from a hospital setting to home.  The insurance usually pays for medical equipment which helps someone stay in their own home longer. A medical alert system is very valuable and is usually also covered. Home modification which can be grab bars, ramps, or widening narrow areas in your home to make it wheelchair accessible or safer is also part of many plans.

Financially the benefits of LTC insurance are of greatest value. It provides a safety net over your assets so instead of having to liquidate assets, one merely taps into their insurance to pay for care. Medicare or other health insurance does not pay for what most people need which is custodial care in a private setting or Assisted Living, and Skilled care.   Without LTC insurance, people can deplete their savings, CD’s, cash, and other investments. They may be forced to  liquidate their 401k or other investments to pay for the cost of care.  Sometimes, if care is needed for a long period, people may need to sell their home and use the equity to pay for care.

If you are married, the money that you liquidate or use for care reduces the retirement amount for your spouse.  In the case of a long term event such as Alzheimer’s, Parkinson’s, or a stroke, anyone without insurance  can be left with little to nothing.  In cases of premarital agreements, a spouse is still responsible for paying for care.  Your money is not protected.  This type of insurance requires very thoughtful planning in advance since it can affect the outcome of a person’s lifestyle in their retirement years.  Most people should purchase this type of coverage before 60 since premiums are lower and it is easier to pass underwriting.  My average age client is 54 years old.