Are you looking for the best long term care insurance product or quote? Would you like help determining if you even need it? We are set up with all of the available carriers for Long Term Care Insurance. Many brokers will only use the “Big Four” companies, but we are contracted with every one in order to shop around and get the best rate. There are typically 3 different kinds of long term care insurance policies, we can help you navigate which one is right for you.
- The Long Term Care “Partnership” Policy – with this kind of long term care insurance policy you have a benefit that increases by at least a 3{732594ea31e72095910d746e913a6a6397494864935c93cd30bf5038bbc545ed} compound each year. Then your entire benefit base protects you from a medicaid spend down if you run out of funds. Let’s use an example: Let’s say you get a policy that has a $3,500 per month benefit for a 5 year period. Let’s say you take this policy out at age 60. At age 75 you need to access your benefit and end up using all the benefit over a 5 year period. It would pay out (3,500 compounded at 3{732594ea31e72095910d746e913a6a6397494864935c93cd30bf5038bbc545ed} for 15 years) $5,452 per month for those 5 years totaling $327,173 over the 5 year payout period. After your benefit paid out, and you still require care, normally you would have to spend through ALL of your investments down to $2,000 before medicaid would pay anything for your care. But if you have a state partnership policy you’d only have to spend down to $327,173 instead. Basically this is Medicaid thanking you for saving them money. By having this protection it protects your spouse from effectively going broke while you need long term care. It also protects an inheritance as Medicaid can’t come after that part of your money. And of course it saves you money.
- The “Normal” Long Term Care Insurance Policy – with this kind of long term care insurance policy you have a benefit that does not increase at all to keep up with inflation or rising costs. One of the benefits of having this kind of policy is that usually the premiums are lower than a partnership policy. Let’s say you have a benefit of $6,000 per month that lasts for 5 years. Overall this would pay out $360,000 over a 5 year period if you needed care. When you get a policy like this you hope you’ll never need more coverage than what you get so you are still risking a medicaid spend down. The smaller premiums make having long term care insurance more feasible. This is usually not the recommended course of action but it is still better than having nothing.
- The “Hybrid” Long Term Care Insurance Policy – this is the policy you ultimately want. With this option you pay a larger premium up front but once you pay that premium you don’t have to pay anymore money. And then if you never need long term care then the entire amount is payable as a death benefit to your beneficiary. With this option you take away the possibility of paying long term care premiums and never seeing any money back. But if you do need long term care then the premium you pay can be used 2-6 times for long term care. Here is an example, you put up a $50,000 premium(payable as a lump sum or over 10 years), based on your age you qualify for the maximum 6X multiplier for long term care, which means you could get up to $300,000 in benefits paid if you needed to access it for long term care, which is great. But then if you didn’t ever need it then your spouse or children would receive $50,000 if you were to die. In this way you take away the risk of paying long term care premiums for years and never getting any benefit from it!
Some of this confusing? Don’t worry. That’s what we’re here for. For a free complimentary analysis and quote please fill out our contact form and choose the Insurance checkbox. We meet with people locally and do virtual appointments all the time!