ElderLaw News-The Estate Planning & Elder Law Firm, P.C. — MD, VA, DC
ElderLaw News
ElderLaw News is a weekly e-newsletter that brings you reports of legal developments and other trends of vital interest to seniors and their advocates. This newsletter is brought to you by The Estate Planning & Elder Law Firm, P.C., William S. Fralin, Esq., President., William S. Fralin, Esq., President.

What To Look For In A Long-Term Care Insurance Policy

For individuals who can afford it, long-term care insurance is an excellent tool to help protect your retirement savings against the significant expense of long-term care, whether the care is provided in your home, at an assisted living facility, or at a nursing home.

Unless you have personal experience with long-term care insurance (from, say, assisting your parents), you may need some assistance in determining what kind of policy to look for, the type of benefit to obtain, and which product best suits your – and your family’s – needs.

Not all long-term care insurance policies are created equal. When shopping for one, we recommend you consider the following:

• Type of benefit. When most people think about long-term care, the first thing that comes to mind is nursing home care. However, not all long-term care insurance policies cover care in a nursing home. Some policies cover only in-home care; others cover assisted living facility care, and others cover nursing home care. Some policies cover any combination of these options. Carefully review the types of care covered by the policy before you purchase it.

• Period and amount of coverage. Will the policy last for a certain number of years or until a set number of dollars have been spent? A combination of the two? If the policy is capped at a certain number of dollars, try to obtain an estimate of the cost of care in a local facility to determine how long the policy will last. Factor your projected income into your estimate to determine how much of a gap there will be between your long-term care expenses and your monthly income. Keep in mind that individuals who need long-term care need it for an average of about 3 years, but if you have a family history of Alzheimer’s, you may want longer coverage.

• Inflation protection. If you are purchasing your policy at a relatively young age (say, in your late fifties or early sixties), there is a chance you may not need to use it for 15, 20, maybe even 25 years. What seems like an adequate policy today might not be sufficient in 15, 20, or 25 years, however. To protect against changes in the value of the dollar, consider purchasing a policy with inflation protection (3% compound inflation protection is currently the most common).

• Strength of the insurer. As a general rule, you should purchase long-term care insurance from a company with a good reputation; avoid purchasing a policy from a lesser-known company that may not still be around by the time you need to use it.

• Hybrid products. If you’re concerned that you might never use your long-term care insurance policy, and therefore forfeit the premiums you’ve paid, you might consider looking into a hybrid product that combines a life insurance policy with a long-term care insurance rider. If you fail to use the policy, your designated beneficiaries will receive life insurance benefits at your death.

Keep in mind that premiums for long-term care insurance policies are lower for younger individuals; because of this, your late fifties and early sixties are the best times to purchase these policies. As with life insurance, as you age, there is an increased chance that you will develop a medical condition that will make long-term care insurance more expensive or even impossible to obtain.


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Maryland (301) 214-2229
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The Estate Planning & Elder Law Firm, P.C.

The Estate Planning & Elder Law Firm, P.C. is an elder law firm. We represent older persons, disabled persons, their families, and their advocates. The practice of elder law includes estate planning, estate and trust administration, powers of attorney, advance medical directives, titling of assets and designations of beneficiaries, guardianships, conservatorships, and public entitlements such as Medicaid, Medicare, Social Security, and SSI, disability planning, income tax planning and preparation, care management, and fiduciary services. For more information about The Estate Planning & Elder Law Firm, P.C., please visit our website at http://www.chroniccareadvocacy.com.

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This newsletter is not intended as a substitute for legal counsel. While every precaution has been taken to make this newsletter accurate, we assume no responsibility for errors, omissions, or damages resulting from the use of the information in this newsletter. The Estate Planning & Elder Law Firm, P.C. thanks the law firm of Hook Law Center for their input to this newsletter.

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