Long-term Care Insurance

1
Long-term Care Insurance

• Dr. AA Neidermeyer

2
Candidates for Coverage

• Age-driven
• Age 65-69 10 require institutional care
• Age 75-79 20 require institutional care
• Age 85-89 40 require institutional care
• Women live longer Higher incidence of need for
  females.
• Individuals who desire to protect a portion of
  their accumulated assets.

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Coverage Parameters

• Initiation of Coverage
• Magnitude of Coverage
• Length of Time Receiving Benefits

• Impact of Inflation
• Entitlement to Benefits
• Companys Financial Soundness and Engagement
  History

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Initiation of Coverage

• If applicable, policy initiates after the
  individual exhausts Medicare coverage.
• Coverage initiates once policyholder qualifies
  under the policy contact. Normal interpretation
  is that the individual cannot perform 2 of the
  normal daily functions of living required to
  self-sustain.

5
Magnitude of Coverage

• Investigate daily costs of care in your location.
• Reasonableness would dictate that you should
  insure sufficiently to receive 75 -100 of your
  likely daily charges for care.
• Interface coverage with your resources.

6
Length of Benefit Period

• Average stay in a nursing home or receipt of care
  at home is three years or less.
• You would usually be safe in having sufficient
  coverage for the period of time you would require
  services if you purchased a policy with a
  three-year benefit period. The choice is yours.

7
Inflations Impact

• Medical costs are rising at approximately 10 to
  15 annually.
• Your policy should include an annual inflation
  adjustment for your benefits. A 5 inflation
  adjustment is recommended to provide adequate
  benefits in the future.

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Initiation of Benefits

• While each policy is different, most contracts
  stipulate that benefits will be forthcoming once
  the policyholder cannot perform 2 of the daily
  living activities without assistance.
• Be sure your policy covers the general diagnosis
  of dementia.
• Policy should cover in-home services as well as
  institutional care.

9
Company Profile

• Select a company that has been in the long-term
  care business for a number of years and remains
  in good financial standing.
• At present, the industry is dominated by three
  providers General Electric, John Hancock and
  Metropolitan have sixty percent of the existing
  LTC market.