Options in LTCi
According to financial planners, people should
start to think about purchasing a LTCi policy when
they reach their late 50s. Although a few employers
offer LTCi policies as an optional benefit, in most
cases LTCi is a policy youíll need to purchase from
an outside company.
Several factors will influence the cost, but the
average annual figure for LTCi is about $1,900.
The premium will depend on:
- how long you pay out-of-pocket until the
- kicks in (often 90 days)
- age and current health situation
- the amount of coverage you can afford and
- much youíll need to cover the average costs
- care in your area
Before purchasing a policy, it is important to
find a financial planner or insurance agency that
specializes in long-term care planning and talk to
them about the options.
Some things to consider:
First decide if LTCi makes sense given your
current situation. If you have a large amount in
assets, youíll probably want to purchase a policy to
protect your assets. However, if you canít afford
the premiums without changing your current
lifestyle, then it might not make the most sense for
Make sure that the policy you choose does not
have a hospitalization requirement prior to service
kicking in. If it does, you might save on premium
costs but could end up paying a steep bill before
you can access the benefit.
Make sure the policy you choose takes inflation
into account. Youíll want a policy that has a
compound inflation protection benefit increase
(usually around 5 percent) to cover rising prices.