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What is it? Long-term care insurance (LTCI) In return for your payment of premiums, a long-term care insurance (LTCI) policy will pay a selected dollar amount per day (for a selected period of time) for your skilled, intermediate, or custodial care in nursing homes and, sometimes, in alternative care settings, such as home health care. Because Medicare and other forms of health insurance do not pay for custodial care, many nursing home residents have only three…
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What is long-term care? Learn more about the types of long-term care below. In general, long-term care refers to a broad range of medical and personal services designed to assist individuals who have lost their ability to function independently. The need for this ongoing care arises when you have a chronic disability or when physical/mental impairments prevent you from performing certain basic activities, such as feeding, bathing, dressing, transferring, and toileting. What are the three types…
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Am I prepared for long-term care expenses? In general, Americans are not sufficiently prepared to pay for long-term care expenses. Many of them go through their lives simply hoping that they won’t ever need it. Unfortunately, in the event that you or a loved one does need long-term care, hope won’t be enough to protect you from potential financial ruin. Self-insurance as an option for long-term care expenses To self-insure — that is, to cover the…
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Determining the Need for Long-Term CareInsurance (LTCI): How Much Is Enough? To determine the need for long-term care insurance (LTCI) depends on your financial ability, age, health status, retirement objectives, and whether you have assets you want to protect. Once you’ve made the decision to buy, you’ll need to decide how much coverage is enough. Insurance protects against an event that may (or may not) occur in the future. Buying sufficient protection is important, but the…
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Should I buy long-term care insurance? As we get older and our health declines, the greater the chances are that we will require home care, nursing home care, or other assisted-living arrangements. This care is quite expensive, and Medicare, HMOs, and Medigap don’t pay for it. You might want to look into purchasing long-term care insurance (LTCI) to protect your assets in case you need long-term care. Whether or not you should purchase long-term care insurance…
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What is Cash Value Life Insurance? When you pay premiums on a cash value life insurance policy, some of your money is applied toward the policy cash value, like a savings account within the policy. Over time, cash values accumulate. During your lifetime, you can access the cash value by a withdrawal, policy loan, or surrender (cancellation) of the policy. How can you access the cash value in your policy? The cash value in your policy…
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Most people are familiar with whole life insurance. For many years, whole-life policies were the predominant type of life insurance sold in America. When you purchase a whole life policy, you traditionally pay a fixed premium for as long as you live or as long as you keep the policy. In exchange for this fixed premium, the insurance company promises to pay a set benefit upon your death. Whole Life Insurance Benefits In addition to a…
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If you’re close to retirement and already have a life insurance policy with sufficient cash value, you can use that cash to save for retirement. But if you’re young and looking for a savings program for your retirement, there may be better ways than using life insurance. Life insurance is designed to protect against unexpected economic loss, so if you don’t need a death benefit, you might want to look into a tax-sheltered program such as…
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If your policy has accumulated cash value over the years, you can borrow against it. You must then pay back the borrowed amount; if you don’t, the amount owed plus interest is subtracted from the death benefit. Or, you can simply surrender your policy and get a check for the cash value, but then you no longer have life insurance. You may also have a life insurance policy that includes an accelerated benefits rider. If so,…
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Life insurance has many uses, including income replacement, business continuation, and estate preservation. Long-term care insurance helps provide financial protection against the potentially high cost of long-term care. If you find yourself in need of both types of insurance, a life insurance policy that combines a death benefit with a long-term care rider may appeal to you. Here’s how life insurance with a long-term care rider works Some life insurance issuers offer life insurance with a…
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