'z How to Face Skyrocketing Long Term Care Premiums - Article Catalog

Article published by : hellisi on Tuesday, August 28, 2012 - Viewed 1221 times


Category : Insurance

How to Face Skyrocketing Long Term Care Premiums

So when you have finally determined that you are likely to need long term care (LTC), the next thing to ask yourself now is can you afford skyrocketing long term care premiums. The staggering cost of LTC is one of the factors that discourage interested plan buyers. There are various reasons why prices usually climb up annually. It is important to know these to be able to better assess your capability of buying a plan. Similarly, this can also help you figure out effective strategies in lowering premiums. With good schemes in saving in LTC costs, there may be no need to think twice anymore in purchasing coverage.

As prices seem to rise every year, most financial experts would recommend that you buy your long term care insurance (LTCI) policy early. Every year that you postpone waiting to avail LTCI, it may add about 10% to 12% in the premiums you could have been paying had you bought a plan earlier. This also means that when you buy at a younger age, you have fewer health concerns so the rate of getting underwritten and receiving approval from an insurance company would be higher as compared when you buy at an older age and various health problems start to show up already.

Reasons for High LTC Premiums

One of the reasons why long term care premiums rise annually is that policy holders live longer than expected and insurance companies have to pay more claims than anticipated. Premium long term care is improving the health and lives of plan holders that is why they keep their policies to continuously afford LTC services. Low interest rates also push companies in increasing their rates. This is because low interests lessen the expected returns that insurers receive from their investments. However, the rules for increasing the rates differ in every state.

Effective Strategies to Face High Premiums

As mentioned, buying your plan early can make a significant difference. Additionally, familiarizing yourself with available discounts can also help you cope with skyrocketing prices. There are good health discounts, spousal discounts, and group discounts. For good health discounts, if you are healthy, you can get good coverage at a more affordable price. As for spousal discounts, both married and cohabiting couples can already take advantage of about 10% to 35% annual discount. Group discounts can be received from employers who offer LTCI.

Long term care tax deductions can also contribute a lot if you want to save on LTC costs. Insurance premiums on tax qualified policies are considered as expenses. You can inquire about this from an insurance agent, LTC expert or your financial adviser.

Moreover, proper LTC planning can also give you considerable advantage specially on your long term care premiums. Seek to create a smaller plan. Co-insure part of your LTC costs, choose longer elimination period, lower your daily benefit amount and get a 4-year policy to reduce costs significantly. Prepare now for LTCI. You can get free long term care quotes to have an idea of the possible costs.


Keywords: what is long term care insurance, long term care planning

By: hellisi

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Article ID 1002637 (Views 1221)

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