Long Term Care Info: How To Avoid Premium Hikes on LTC Insurance? – Financeforhealth.com

Another concern that prevents Americans from buying long term care insurance is the lack of guarantee that their LTC insurance premiums will remain the same over the years. They are bothered by the thought that after years of paying, their premiums will increase to a point where they can no longer afford paying for it, which will then lead to the cancellation of their policies. Unknown to many, there are long term care insurance features that can help you avoid or lessen the risks of premium rates increase.

 Single Premium Long Term Care Insurance

 The single premium long term care insurance allows a policy owner to be insured for life by making just one lump sum payment. Of course, this would mean he needs to set aside huge amount of money but the good thing about this is after making the lump sum payment, he wouldn’t have to make another which means he doesn’t  have to worry about future premium rates increase.

Limited-Pay Long Term Care Insurance

If you cannot afford to make the lump sum payment, you can opt for limited-pay long term care insurance policies. These types of policies allow policy owners to pay their premiums in a limited period of time. In most LTC insurance companies, the time frame is set to 10 years or until the policy owners turns 65. After paying the premiums for this duration, policy owners will be insured without making additional payments. While the premiums could still increase within that time frame, most definitely, the risk is lower compared to policies which require continuous payments until benefits are triggered. Of course, since the premiums are paid in shorter periods of time, then the premiums for these types of policies are higher compared to standard-pay LTC insurance.

There are also limited-pay LTC policies that offer a rate guarantee. For instance, policies with 10-year rate guarantee assure that premiums will remain the same for 10 years. Not all LTC insurance companies offer this type of policy. To know if this option is available in your chosen insurance provider, check the long term care info available on their website or call them directly.

Single-Premium Asset-Based Life Insurance with Long Term Care Coverage

The underlying concept of single-premium asset-based life insurance with long term care coverage is the same as single premium LTC insurance, except that aside from LTC benefits, the first also offers death benefits. In most policies, the LTC benefits can be four times the amount of the single premiums paid. In addition, the life benefits can be twice the premium.

To know more about these options, you can speak with a LTC insurance specialist who can guide you in choosing the best type of policy according to your preferences and budget. Being experts in this field, they can provide you with detailed long term care info and insurance options you may not know as of yet.

 

Sources:

  • http://www.medicare.gov/longtermcare/static/home.asp
  • http://www.consumerreports.org/cro/2012/08/long-term-care-insurance/index.htm
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