Long-Term Care Insurance

Long-Term Care Insurance

We represent you to the best companies offering long term care (LTC) and help you choose the most appropriate plan in terms of cost and coverage. Depending on your financial resources it may be unnecessary to have a Traditional LTC policy. See the discussion below and call us at (800) 595-0215 for more information.
There are two basic types of Long Term Care Insurances: Traditional and Linked Benefits.

Traditional LTC Policies

Recommended if you have not or will not save enough to cover your future LTC needs. We can help you optimize your selection of benefits versus cost for which you pay a periodic premium. A concern with this form of LTC is the cost. If you die before you use it, there is no death benefit unless you buy it, and, if not, all the premium expenditures go down the drain. If you drop the policy before you use it, there is a non-forfeiture clause, but that has a reduced benefit.

Linked Benefit Life Insurance or Annuity with LTC Rider Policies

Overcomes the concerns with traditional LTC because the money that you have saved, or will set aside for LTC, can be put into an account as a single payment, and is as safe and liquid as a savings account that gains interest. You can access those funds with no penalty because it is your money. And, when you need LTC, it is there to pay for in-home, assisted living, adult day care, or nursing home care as you need it. These policies are insurance that multiply your contributions up to five times. So, even when your original contribution is paid out for LTC benefits, the insurance company continues the annual payments for another three years. And, if you pass away before the funds are used up, your heirs get a tax free death benefit. Now, doesn’t that sound too good to be true? It is true.

Lincoln Financial MoneyGuard Long Term Care Policy

This is a single premium product that provides an initial long-term care benefit of about four times the single premium payable over 7 years. In this manner, one can leverage low yielding assets set aside for long-term care and only dedicate about 25% to LTC and keep about 75% for other purposes. It includes simple inflation of 3% per year and a death benefit whereas traditional plans don’t do that. For example: a single premium of $100,000 buys an initial LTC benefit of $412,000 which is equivalent to $161 per day for 7 years. The inflator will increase those amounts at age 70 to $523,000 and $205 per day for 7 years. If you do not have enough funds set aside to fund the plan immediately, there is a flex-pay option. The death benefit protects your estate from forfeiture of your premium. The initial death benefit is $255,000 and decreases to $176,000 by age 75 as the LTC benefit climbs to $585,000. LTC claims are deducted from the death benefit. Either way, you get the LTC or death benefit or part of both. These features are much better than traditional LTC where purchase of a death benefit rider is virtually unaffordable. Also, there is no risk of future rate increases as with traditional LTC. Finally, there is a surrender feature where you can get all or more of your original premium returned with interest less LTC benefit claims. So, if you don’t plan to use it, you can get your money back. Click here to see a short video that explains it all.


Many people mistakenly think their health insurance or Medicare will pay for any long-term care services they may need at some point; but health insurance really only pays for doctor and hospital bills and nursing home care during recovery. As soon as you are well, out you go!
Long Term Care pays for your care when you are unable to take care of yourself due to a chronic illness that makes you unable to perform two of six activities of daily living (ADL): Transferring out of bed, continence, toileting, eating, dressing, and bathing. Cognitive ability such as Alzheimer’s is another qualifying event that triggers LTC benefits.
If you develop a chronic illness you’ll need long-term care services. And these services aren’t cheap. Full-time nursing home care averages $69,000 to $78,000 per year or 8 hours per day of home health care can cost $43,000 to $70,000 annually.
The best time to buy LTC is in your late fifties or early sixties because the cost goes up with age. If you wait until you think that you need it, then you may not qualify to get it. Only about 10% of the population buys LTC but, statistics show that 70% will need LTC in their lifetime. Lacking LTC coverage typically results in exhaustion of a family’s wealth and destines you to a low quality Medicaid facility.
Here is a calculator from Mutual of Omaha to estimate how much coverage you may need:Calculator
LTC insurance can be obtained via traditional LTC policies or as riders to life insurance and annuities. If one has set aside money for LTC in various savings or other assets, the best vehicle is a single premium life or annuity policy with an LTC rider.
Explore the following sections to learn more about who needs long-term care insurance, what types of care are covered, policy options and features, and where and when to buy it.
Following is detailed information about buying long term care insurance:

Who Needs Long-Term Care Insurance?

If you can afford long-term care insurance, you should probably consider it. Why? Because the cost of long-term care, should you need it, can quickly deplete your life’s savings. For instance, having a home health aide visit just three days a week can cost more than $20,000 annually. Full-time nursing home care, the most expensive type of care, now averages $69,000 to $78,000 per year. In some regions of the country, like the Northeast, the cost may be twice that amount.
While financial considerations cannot be understated, long-term care insurance isn’t only about money. It’s also about peace of mind. Having it ensures you’ll have access to first-rate care when you need it. It also means you won’t have to be dependent on others or be a burden to your children.
What are the odds you’ll need long-term care insurance? Greater than you might imagine. There’s about a 70 percent chance you’ll need some type of long-term care after age 65. And long-term care services are not just for older people. A young or middle-aged person who has been in an accident or suffers from a debilitating illness may very well require long-term care services. In fact, 40 percent of patients receiving long-term care are under age 65.
If you can afford to pay for care without significantly impacting your assets, you may not need long-term care insurance. Conversely, if your assets, not including your home, are less than $80,000 if you’re married (or $30,000 if you’re single), you may not be able to afford the premiums. But If you’re somewhere in between, long-term care insurance should be part of the discussion the next time you sit down with an advisor to review your financial plans.
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How Much Does Long-Term Care Cost?

Long-Term care services, whether obtained in a nursing home full-time or in your house a few days a week in the Los Angeles area cost about $78,000 per year. The average stay in a nursing home is 2 ½ years.
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How Do I Get Protection?

The best way to ensure that you’ll have access to high-quality long-term care services is to have long-term care insurance coverage. Some benefits also are available from the government, through Medicare and Medicaid.
However, you should be careful about relying on government programs. Medicare covers only short-term skilled nursing home care, and Medicaid will pay for your care only if your assets are very limited. Some states have Long-Term Care Insurance Partnership Programs that allow you to buy private long-term care insurance and remain eligible for Medicaid benefits if your private insurance runs out. Read on to learn more about the various sources of protection.
This is the most reliable way to cover the potential costs of long-term care while protecting your savings. You can purchase coverage from any number of companies, and there are policies and features to fit most price ranges. Because there are so many options to weigh when considering a purchase, you’ll want to find an agent who specializes in long-term care insurance. That person will be able to explain the many features of long-term care insurance and help you strike the appropriate balance between the benefits you desire and the money you have to spend.
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When Should I Buy It?

As with most kinds of personal insurance, the younger you are when you purchase long-term care insurance, the lower your premiums will be. Once you own a policy, premiums generally don’t increase with age, unless an insurance company raises them for a whole class of policyholders.
When you consider that 40 percent of those receiving long-term care are under age 65, you should at least give some thought to buying coverage when you’re still relatively young. Doing so should allow you to lock in a low rate while providing you with coverage that may be needed sooner than you think. Also, be aware that most companies won’t sell individual policies to people under age 18 or over age 84.
If you can’t buy as much coverage as you think you need, consider buying an affordable plan now and enhancing it later when your financial situation improves.
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What Types of Care are Covered?

Long-term care insurance pays for a wide range of services and procedures that typically aren’t covered by a person’s medical insurance. The types of care fall into three categories: skilled, intermediate and custodial. Read on to understand the differences between the various types of care.


If you have a serious illness or injury that you can recover from, you will probably receive skilled care from nurses or professional therapists. Skilled care is provided daily, usually ordered by a physician, and involves a treatment plan. In short, skilled care helps get you better.

Intermediate Care

This type of care is the same as skilled care, but not provided on a daily basis. For instance, if you injured your leg and need to visit a physical therapist five times a week to help you heal, that would be considered intermediate care.

Custodial Care

Unlike skilled and intermediate care, which is used to improve your health, custodial care isn’t intended to get you better. Instead, custodial care includes assistance with daily activities like bathing, eating, dressing, toileting (getting on and off the toilet and other tasks associated with personal hygiene), continence and transferring (getting in and out of bed and chairs). Catheter or colostomy drain are other examples of custodial care. Custodial care can range from in-home care provided two or three days a week, to 24-hour nursing home care.
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Where is Care Delivered?

Many people mistakenly think long-term care is synonymous with nursing home care. A nursing home is a good example of a facility that provides long-term care services, but it’s just one of the many settings in which long-term care is delivered. In many cases, care is provided in the home often by a visiting nurse or a home health aide. Long-term care services are also provided in places like assisted living facilities and adult day care centers. Because long-term care insurance policies may differ in what they cover, it’s important to be familiar with the different locations where you can receive care. Below we describe the four settings in which most long-term care is delivered.
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How to Select the Benefits you may need

When evaluating a long-term care insurance policy, here are important things to consider designing your coverage to fit your budget.

Benefit amount and duration

How much coverage do you need considering your other assets and income? Most folks can self-fund long term care and insure the rest needed.
Most long-term care policies are set up as indemnity plans, which mean they pay a fixed dollar amount for each day you receive care. Policyholders usually have a choice of daily benefit amounts ranging from $50 to $300 or more, and can also choose the length of time that benefits will be paid. Long-term care policies generally limit benefits to a maximum dollar amount or a maximum number of days and may have separate benefit limits for nursing home, assisted living facility, and home health care within the same policy. For example, a policy may offer $100 per day up to five years of nursing home coverage (many policies now offer lifetime nursing home coverage) and only up to $80 per day up to five years of home assisted living and health care coverage.

Elimination or deductible periods

Consider paying the first 6 months from your savings to greatly reduce premium.
These terms refer to how many days you must spend in a nursing home or how many home health visits you must receive before benefits begin. Most policies offer a choice of deductible from zero to 100 days. The longer the elimination or deductible period, the lower the premium.


Choose 6 month exclusion period to reduce cost.
When you apply for a policy, you’ll be asked to fill out a medical questionnaire, and probably undergo a check-up with a doctor. This helps the insurance company find out about any existing health issues (known as preexisting conditions) that make it more likely that you’ll one day need long-term care. Preexisting conditions may make coverage more expensive, and the insurance company may choose not to cover you for these conditions during your first six months of coverage.

Inflation protection

Choose compounded inflation protection at age 55-60 and simple at age 61+.
Because long-term care prices are rising steadily, the benefit you buy today may be inadequate tomorrow. By purchasing inflation protection, your policy benefit will automatically increase each year at a specified rate (such as 5 percent) compounded over the life of the policy.

Nonforfeiture benefits

Always choose this optional feature.
This feature allows you to drop your coverage and still receive a portion of the benefits. Non-forfeiture benefits may be received two ways, depending on the policy and option you choose. Return of premium provides cash payment that is a percentage of the total premiums you have paid. With a shortened benefit period, you still receive coverage after you’ve stopped paying, but with a reduced benefit period or amount.


Almost all long-term care policies are guaranteed renewable. That means that they cannot be canceled as long as you pay your premiums. However, companies can raise premiums as long as they raise them for an entire class of policyholders. The renewability provision, usually found on the first page of the policy, outlines under what conditions the company can cancel the policy or raise premiums.
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Real Life Stories

Vernon Duckett – Peace of Mind for the Long Term

When Vernon Duckett first heard of long-term care insurance from his wife, Helen, he wasn’t enthusiastic, but his wife talked him into it. Years later when Helen was diagnosed with Alzheimer’s, Vernon was thankful they had purchased the coverage. Helen’s policy paid for the best possible care until her death at age 82 and has preserved Vernon’s financial independence.

Barbara Fosberg – A Peaceful and Dignified End

It was hard for Barbara Fosberg to watch her husband, Morton, suffer from Alzheimer’s disease. Morton was a very intelligent man, and the disease robbed him of his speech and memory. But thanks to long-term care insurance, paying for Morton’s care was never a problem. Home health care aides cared for Morton during the day, allowing Barbara to maintain her career as a lawyer. As the disease progressed, Barbara was able to move her husband to a small group home where she could visit after work and where skilled and loving caregivers could provide him with the level of care he needed.

Barry Shore – Optimism and Planning Prevail

Barry Shore, a 55-year-old real estate executive, was enjoying a normal life when a rare neurological disorder struck suddenly, causing him to lose all movement in his body. Throughout his ordeal, money is one thing Barry and his family haven’t worried about thanks to smart insurance planning. Disability insurance payments have replaced more than half of Barry’s income. And long-term care insurance has provided more than enough to pay for in-home care as well as physical, occupational and water therapy.

Lynda Striepe – Preserving a Secure Retirement

Allen Striepe was a respected school teacher until Alzheimer’s disease made him too sick to work. Long-term care insurance allowed his wife Lynda to hire a home health aide, so she could continue her teaching career. Five months later, Lynda could no longer care for him on her own and Allen’s insurance covered his stay in an assisted living facility and later in a nursing home. Though Allen died two years after his initial diagnosis, Lynda credits the insurance for getting her husband the care he deserved and preserving her retirement assets.

Margaret Sweborg – The Will to Survive

Margaret Sweborg was always a very active and independent-minded person. Wanting to maintain her independence even if her health were to deteriorate one day, Margaret purchased long-term care insurance at age 66. That day arrived 13 years later when Margaret broke her hip and nearly died as she lay on the floor of her home for days, unable to call for help. No longer able to manage her own physical or financial affairs, Margaret relied on her step-granddaughter, Rindy, to take over. Rindy worked with Margaret’s agent to file the long-term care insurance claim. The money from that policy, coupled with some retirement savings, enabled Margaret to move to a first-rate nursing home. Without it, she probably would have spent down all her assets and sought inferior, Medicaid-funded care.
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