08/27/2012
I founded Futurecare Associates in 1998 to provide an educational and product resource focused on long term care insurance for consumers and advisors. I've learned a lot about all three over the last 14 years!
LTCI has and still is evolving. It is not user friendly, largely, I think, because the companies selling it seem to be afraid of what it may mean to their bottom line down the road. That's caused some major insurers with what I thought were really good and reasonably priced products to withdraw from the market or to modify their products for new sales.
Legislation has also impacted the LTCI market. The Pension Protection Act has opened up several financial planning options involving the use of non-qualified annuities and life insurance cash surrender values in the tax-favored acquisition of LTCI.
Hybrid life and annuity policies, in which an LTCI benefit is attached as a rider, have become more popular, particularly among financial planners, because, in part, the life component provides a response to the complaint about paying for LTCI premiums but not needing long term care before death.
31% of us will never need long term care, but no one, at least not yet, has figured out how beat the other eventuality.
Many states have also established Partnership Programs which can provide shelter for some assets should an insured exhaust her or his LTCI benefits and need to apply for Medicaid financial benefits for their continuing long term care. The LTCI policy must, however, have qualified as a Partnership policy. Such status both requires the insurance company to have received approval for its product as compliant with the Partnership Program of the state in which it was issued, and the terms of the insured's policy itself must meet certain Partnership requirements.
If you're still awake, and that's what I meant by saying that the subject isn't user friendly!, please think about who's going to be in that 69%. At $60,000 to whatever a year today, I think its worth hedging the bet with at least a modestly sized pool of guaranteed long term care dollars.
Whether you're a consumer beginning to feel a little creeky or an advisor thinking about the risk in your own plan or a client's exposure--as well as your own should your client have a need for care but hasn't given consideration to an insured benefit--please do consider giving us a call. Or at least check out our website, www.futurecareassociates.com. We think you'll find some useful information. Thank you!
