In 2020, the Administration for Community Living (ACL) estimated that someone 65 years or older has about a 70% chance of needing long-term care. On average, these individuals will require some form of long-term care service for three years. Without insurance, the cost to provide this kind of care quickly adds up.
What is long-term care insurance, and is it something you need? Whether you are looking at long-term care options for yourself or for a family member, it’s always a good idea to evaluate all available options. Let’s dive a little bit deeper into long-term care insurance and how to determine if it is a good fit for you.
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For many of us, our loved ones will eventually need help with daily activities. From getting dressed and preparing meals to getting in and out of chairs or taking medications, some of the simplest tasks can be a great burden as we get older. Long-term care (LTC) services provide assistance when these issues arise. When researching LTC options, you’ll find that Medicaid and Medicare do not provide coverage. So, what are your options when you or a family member needs this type of assistance?
If you were to pay out of pocket for LTC services, you’d quickly run through your money. Health insurance is designed to alleviate some of the financial burden of health-related expenses, but this often doesn’t include long-term care. Instead, long-term care insurance (LTCI) provides the coverage needed for chronic illness, disabilities, or disorders that require daily assistance.
Long-term care services can cover a wide range of needs. If your family members need in-home care, LTCI can help cover the costs of medical expenses, including daily healthcare providers. Alternatively, long-term care insurance can cover the expenses of assisted living facilities or treatment centers.
Figuring out how to cover the expenses of long-term care can be quite stressful. Fortunately, long-term care insurance options can provide you with the coverage needed to ensure you or your loved ones are well prepared in case health status declines. When evaluating long-term care insurance options, you’ll find there are three main types to choose from.
So, how do you decide which type of long-term care insurance is right for you? First, you’ll need to get in touch with your insurance provider to find out what options they have for long-term care insurance. From there, think about how much care you need. If you are considering long-term care insurance for yourself, do you also need life insurance coverage? Do you already have whole life insurance and are looking to add a rider?
Until you grow older, you won’t know for sure if you’ll need long-term care. However, given the fact that life expectancy is at an all time high, many people choose to purchase LTCI in order to provide peace of mind for the future. You never know when your health could change, and knowing you’ll be able to get the care you need in the event of a sudden health change can greatly reduce any fears you might be experiencing.
Long-term care insurance isn’t the right fit for everyone. If you’re still seeking financial support as you grow older, there are other options available to you. Below are some of the ways that you can find coverage options that fit your needs and align with your budget.
Like the name suggests, whole life insurance provides coverage until the policy terminates, which occurs when the policyowner has passed away. With this type of permanent life insurance product, there’s a death benefit which provides financial support for beneficiaries after the policyowner has passed away. These benefits can be used for a variety of purposes, but many beneficiaries choose to use it to cover the costs of end-of-life expenses, such as funeral expenses or long-term care services.
Participating life insurance policies allow policyholders to receive dividends from their policy. While dividends are not guaranteed with ELCO Mutual products, they can provide significant financial support if the insurance company performs well. Dividends are paid to policyowners at a rate that reflects the performance of the insurance provider. So, if the company does well, policyowners might be eligible to receive a significant dividend payment.
This type of policy provides some flexibility with payouts. Many policyowners choose to use the dividends to contribute to premium payments. However, if you find yourself in need of long-term care assistance, these dividends can go toward those expenses.
By purchasing an annuity, you can receive payments from your insurance provider in exchange for premium payments. As your insurance company collects premium payments, the annuity value grows over time. Income payments from the annuity gives you extra financial protection in the long run. So, you can use this income to cover a wide range of expenses, including long-term care services.
Some insurance providers have long-term care annuities, which are a form of deferred annuities and are often categorized as hybrid long-term care insurance products. After submitting a lump-sum payment, you can receive income payments to assist with long-term care coverage.
Aging can be a difficult time for families as they watch their loved ones struggle to do the things that used to come so naturally. Fortunately, long-term care can help ensure your family members remain as comfortable as possible.
At ELCO Mutual, we want to do everything we can to ensure that you and your family are well prepared for the unexpected. Our life insurance products are created to bring you peace of mind and give your family a financial safety net in the event of your death. If you are considering life insurance for end-of-life coverage, be sure to reach out to one of our independent agents to learn more about our available products and services.