What's new
Fantasy Football - Footballguys Forums

This is a sample guest message. Register a free account today to become a member! Once signed in, you'll be able to participate on this site by adding your own topics and posts, as well as connect with other members through your own private inbox!

Long term care insurance (1 Viewer)

CurlyNight

Footballguy
Is there an age limit to signing up for this? My dad just turned 79 and is starting to have falls. He has some left side weakness I think from a small stroke. Thankfully his brain is fine. He still works as an engineer. He lives here in Cali. Just got the call and I know I  can google but I don't feel like it right now. I'm a daddy's girl big time. :(  

 
Last edited by a moderator:
Is there an age limit to signing up for this? My dad just turned 79 and is starting to have falls. He has some left side weakness I think from a small stroke. Thankfully his brain is fine. He still works as an engineer. He lives here in Cali. Just got the call and I know I  can google but I don't feel like it right now. I'm a daddy's girl big time. :(  
I don't think most companies have age limits but the premiums would be prohibitively expensive if you take a policy out at his age.

 
Yup, almost certainly too late at 79.  Ideal age is 55-62 for best value.  If you are approaching 55 you need this.  It's essential.

 
Yup, almost certainly too late at 79.  Ideal age is 55-62 for best value.  If you are approaching 55 you need this.  It's essential.
I'm 55 now. I looked into it a couple of years ago and it was more than my mortgage payment. 

My parents somehow had the foresight to get it when they got married. This was in the early 1960s and they were teenagers. When my father got nailed with dementia several years ago and had to go into constant care, it kept my mother from being financially wrecked. She only had to pay 10% out of pocket.

If you're young and can afford it, get it. 

 
I'm 55 now. I looked into it a couple of years ago and it was more than my mortgage payment. 

My parents somehow had the foresight to get it when they got married. This was in the early 1960s and they were teenagers. When my father got nailed with dementia several years ago and had to go into constant care, it kept my mother from being financially wrecked. She only had to pay 10% out of pocket.

If you're young and can afford it, get it. 


If some insurance agent showed you a policy that was more than a mortgage payment, he wasn't showing you long-term care insurance. It was probably a life insurance policy that supposedly can "pay for long term care too". My long-term care premium is about $100 a month and I'm in my mid-fifties, too.

 
Last edited by a moderator:
Is there an age limit to signing up for this? My dad just turned 79 and is starting to have falls. He has some left side weakness I think from a small stroke. Thankfully his brain is fine. He still works as an engineer. He lives here in Cali. Just got the call and I know I  can google but I don't feel like it right now. I'm a daddy's girl big time. :(  
I sell the stuff.  No chance a carrier would accept him, unfortunately.  If they were to, the premiums would be prohibitively high.  I have some policies, which like someone else mentioned here, are more than many people's mortgages - multiple tens of thousands a year.  That said, they also provide up to $200 a day of a benefit ($73k a year, should the need arise), and that $200 a day is growing by 5% compound inflation - meaning it doubles every roughly 14 years.  There is a reason they can be so expensive. 

 
So what is the right age to start considering this stuff, where the benefit of locking in a policy at a lower rate isn't outweighed by the extra years (decades?) of payments? Assume good health. 

 
So what is the right age to start considering this stuff, where the benefit of locking in a policy at a lower rate isn't outweighed by the extra years (decades?) of payments? Assume good health. 
Some say 50...some say 60. I heard that the average stay is something like 3 years.

Keep in mind too that you can "self insure" yourself just by saving/investing over the years and making a big pile of cash money. 

 
I sell the stuff.  No chance a carrier would accept him, unfortunately.  If they were to, the premiums would be prohibitively high.  I have some policies, which like someone else mentioned here, are more than many people's mortgages - multiple tens of thousands a year.  That said, they also provide up to $200 a day of a benefit ($73k a year, should the need arise), and that $200 a day is growing by 5% compound inflation - meaning it doubles every roughly 14 years.  There is a reason they can be so expensive. 
My company sells some too, but I don't do it personally.

@CurlyNight I'd certainly shop it with local agencies...you never know.  It doesn't hurt to try.  I had a cousin that got desperate for it and I told him it was hopeless, but he found someone that was reasonable. 

The Ins industry is soft right now.  There might be a taker. 

Good luck. 

 
Some say 50...some say 60. I heard that the average stay is something like 3 years.

Keep in mind too that you can "self insure" yourself just by saving/investing over the years and making a big pile of cash money. 
While true, that's very misleading.  Most people fall into one of two categories - either dead within 6 months of the need arising (like the case of my paternal grandmother), or lasting on for 5+ years most often because of the need being cognitive, not physical (like the case of my maternal great grandmother).  While 3 years is the "average", it's also a rarity. 

As for the right age - it's honesty pretty early (like 40-50).  For many it's when other expenses (like kids) fade away, but it's also when you're healthier.  If you lock in a policy at say 45, and the benefit has a 5% compounding inflationary kicker, it will double every ~14 years.  So $150 a day at 45 will be ~$300 a day at 60, will be ~$600 a day at 75, will be ~$1,200 a day at 90. 

 
Also, carriers used to offer policies that had lifetime benefits (you need care starting at 70 it wouldn't matter if you needed it till age 100).  Now the most you can get is maybe 10 years, but for many carriers only 6 years.  If your need is only 5 years, it wouldn't matter, but it was certainly a nice benefit while it was offered.  Carriers also generally assumed a much higher interest rate (what they could invest those premiums at for 20-40 years before a claim arose) back in the late 1990s and early 2000s.  Not so much any more, so that's a big reason why policies cost much more now than they used to. 

 
While true, that's very misleading.  Most people fall into one of two categories - either dead within 6 months of the need arising (like the case of my paternal grandmother), or lasting on for 5+ years most often because of the need being cognitive, not physical (like the case of my maternal great grandmother).  While 3 years is the "average", it's also a rarity. 

As for the right age - it's honesty pretty early (like 40-50).  For many it's when other expenses (like kids) fade away, but it's also when you're healthier.  If you lock in a policy at say 45, and the benefit has a 5% compounding inflationary kicker, it will double every ~14 years.  So $150 a day at 45 will be ~$300 a day at 60, will be ~$600 a day at 75, will be ~$1,200 a day at 90. 
Thanks. My thought was to look into a policy around the time my term policy expires, which is at 52. Seems worth it to consider earlier on. 

 
Thanks. My thought was to look into a policy around the time my term policy expires, which is at 52. Seems worth it to consider earlier on. 
Might be.  The issue is if you wait till 55 rather than 45, you missed 10 years of "inflationary kickers" on your benefit.  So instead of buying a policy with a $150 per day benefit at 45, you'd have to buy a $244 per day at 55.  So not only is it more expensive because you're older, you'd have to buy a much larger benefit to equal what you would have had the whole time.  And you might not be as healthy.

 
Last edited by a moderator:
Might be.  The issue is if you wait till 55 rather than 45, you missed 10 years of "inflationary kickers" on your benefit.  So instead of buying a policy with a $150 per day benefit at 45, you'd have to buy a $244 per day at 55.  So not only is it more expensive because you're older, you'd have to buy a much larger benefit to equal what you would have had the whole time.  And you might not be as healthy.
*Sets Google alert for 11 years from now*

 
While true, that's very misleading.  Most people fall into one of two categories - either dead within 6 months of the need arising (like the case of my paternal grandmother), or lasting on for 5+ years most often because of the need being cognitive, not physical (like the case of my maternal great grandmother).  While 3 years is the "average", it's also a rarity. 

As for the right age - it's honesty pretty early (like 40-50).  For many it's when other expenses (like kids) fade away, but it's also when you're healthier.  If you lock in a policy at say 45, and the benefit has a 5% compounding inflationary kicker, it will double every ~14 years.  So $150 a day at 45 will be ~$300 a day at 60, will be ~$600 a day at 75, will be ~$1,200 a day at 90. 
I haven't look at this much so can you explain a bit?  Those amounts per day, is that what the insurance will pay out?   How much does that cost per year in premiums?

My current plan that I really haven't given much thought was to just live in my house until I needed full care at which point I'd just sell and pay for the care with that.   Should get me about 4 years at $100k per.   If I need more than that, it really depends on what age what I'd still have in retirement income based on projections. 

 
I haven't look at this much so can you explain a bit?  Those amounts per day, is that what the insurance will pay out?   How much does that cost per year in premiums?

My current plan that I really haven't given much thought was to just live in my house until I needed full care at which point I'd just sell and pay for the care with that.   Should get me about 4 years at $100k per.   If I need more than that, it really depends on what age what I'd still have in retirement income based on projections. 
Yes, that per day benefit is typically what the maximum amount that the policy would pay.  Most LTC policies are "reimbursement" type arrangements - so if my policy is a $200 per day benefit, but I only have $150 in expenses, it will only pay $150 for that day (the unused $50 will likely get tacked on to the back end).  You can "indemnify" a policy where they will simply pay out the full $200 (in this example) so you bank the other $50, because maybe the next day will cost you $250.  

Rates are dependent on a LOT of factors - age, health, amount, waiting period, benefit period, riders attached, on and on. 

When I first got into the business the "average" policy I sold was about $150 per day ($4,500 a month).  It's now closer to $200 a day ($6k a month) - but even that's not enough in many places.

 
Yes, that per day benefit is typically what the maximum amount that the policy would pay.  Most LTC policies are "reimbursement" type arrangements - so if my policy is a $200 per day benefit, but I only have $150 in expenses, it will only pay $150 for that day (the unused $50 will likely get tacked on to the back end).  You can "indemnify" a policy where they will simply pay out the full $200 (in this example) so you bank the other $50, because maybe the next day will cost you $250.  

Rates are dependent on a LOT of factors - age, health, amount, waiting period, benefit period, riders attached, on and on. 

When I first got into the business the "average" policy I sold was about $150 per day ($4,500 a month).  It's now closer to $200 a day ($6k a month) - but even that's not enough in many places.
Are there any restrictions in place for how much your premiums can increase in a year?   If you buy insurance at 45 and then at 65 your premium start increasing by 50% what are your options?  Seems like you'd be kind of screwed

 
Are there any restrictions in place for how much your premiums can increase in a year?   If you buy insurance at 45 and then at 65 your premium start increasing by 50% what are your options?  Seems like you'd be kind of screwed
Well - a little background.  These premiums are not guaranteed, so they can go up each year.  That said, most don't (but again, the carrier has the ability to - unlike in something like life insurance for instance).  I don't believe I've ever sold an LTC policy where the premiums went up ever for an in force policy.  The only caveat for the carrier increasing their rates is that they'd need to get those new rates approved by each state in which they do business.  But yes, I have seen individuals who got a 50% increase when they are 75 - and on a fixed budget, who are then screwed.  So shop carriers, ask for histories of their rates and if they've ever increased rates on in-force business. 

 
Well - a little background.  These premiums are not guaranteed, so they can go up each year.  That said, most don't (but again, the carrier has the ability to - unlike in something like life insurance for instance).  I don't believe I've ever sold an LTC policy where the premiums went up ever for an in force policy.  The only caveat for the carrier increasing their rates is that they'd need to get those new rates approved by each state in which they do business.  But yes, I have seen individuals who got a 50% increase when they are 75 - and on a fixed budget, who are then screwed.  So shop carriers, ask for histories of their rates and if they've ever increased rates on in-force business. 
The company that offers LTCI to feds doubled premiums in the summer of 2016.  https://federalnewsradio.com/benefits/2016/07/long-term-care-enrollees-get-coverage-options-higher-premiums-in-2017/

For that reason I view it as a pig in a poke.  If my premiums are not a "known" why would I ever consider signing up?  I'll self-insure.  If someone offers a useful product for a known cost I would seriously consider it.  I'm 47.

 
The company that offers LTCI to feds doubled premiums in the summer of 2016.  https://federalnewsradio.com/benefits/2016/07/long-term-care-enrollees-get-coverage-options-higher-premiums-in-2017/

For that reason I view it as a pig in a poke.  If my premiums are not a "known" why would I ever consider signing up?  I'll self-insure.  If someone offers a useful product for a known cost I would seriously consider it.  I'm 47.
Not all long-term care insurance policies are the same. Large group plans like the federal employee plan, don't have to comply with each state's rate increase regulations. A friend of mine purchased a policy with guaranteed level premiums. He was a little younger than you (about 45) when he got it. The premiums are fixed for life. In fact, he set his up where he'd only pay for 20 years so when he retires at 65 it'll be paid up.

 
Not all long-term care insurance policies are the same. Large group plans like the federal employee plan, don't have to comply with each state's rate increase regulations. A friend of mine purchased a policy with guaranteed level premiums. He was a little younger than you (about 45) when he got it. The premiums are fixed for life. In fact, he set his up where he'd only pay for 20 years so when he retires at 65 it'll be paid up.
Thanks.  I will do some research.

 
The company that offers LTCI to feds doubled premiums in the summer of 2016.  https://federalnewsradio.com/benefits/2016/07/long-term-care-enrollees-get-coverage-options-higher-premiums-in-2017/

For that reason I view it as a pig in a poke.  If my premiums are not a "known" why would I ever consider signing up?  I'll self-insure.  If someone offers a useful product for a known cost I would seriously consider it.  I'm 47.
You buy the company as much as you buy the product.  The fed program was backed by John Hancock - and honestly I think they "bit off more than they could chew" with the fed program.  The initial rates were very low, though - so even with a sizeable increase they didn't end up that much more than where other carriers likely were the whole time.

 
Not all long-term care insurance policies are the same. Large group plans like the federal employee plan, don't have to comply with each state's rate increase regulations. A friend of mine purchased a policy with guaranteed level premiums. He was a little younger than you (about 45) when he got it. The premiums are fixed for life. In fact, he set his up where he'd only pay for 20 years so when he retires at 65 it'll be paid up.
Those don't exist as far as I know - no carrier will guarantee their rates on a "traditional" LTC policy.  Some may do so on a "hybrid" type policy which is a life insurance policy with an LTC rider (where you can use the death benefit of the policy to pay for LTC expenses), but I've never seen it on a true stand alone LTC policy.  In fact, right from "longtermcareinsurancepartner.com"....

The Cons of Long Term Care Insurance - Long term care insurance premiums are not guaranteed and may be increased

Carries used to have "limited payment options", though - like a 10 or 20 year premium period at which point the policy is "paid up", but those are getting harder and harder to find, and are getting much more expensive (due to very low interest rates).  For instance at age 50 do you want to pay $10k a year for life (which isn't guaranteed and may go up), or pay $30k a year for only 10 years (which also isn't guaranteed and may go up, but you'd be done with everything after that 10th year)?

 
Those don't exist as far as I know - no carrier will guarantee their rates on a "traditional" LTC policy.  Some may do so on a "hybrid" type policy which is a life insurance policy with an LTC rider (where you can use the death benefit of the policy to pay for LTC expenses), but I've never seen it on a true stand alone LTC policy.  In fact, right from "longtermcareinsurancepartner.com"....

The Cons of Long Term Care Insurance - Long term care insurance premiums are not guaranteed and may be increased

Carries used to have "limited payment options", though - like a 10 or 20 year premium period at which point the policy is "paid up", but those are getting harder and harder to find, and are getting much more expensive (due to very low interest rates).  For instance at age 50 do you want to pay $10k a year for life (which isn't guaranteed and may go up), or pay $30k a year for only 10 years (which also isn't guaranteed and may go up, but you'd be done with everything after that 10th year)?
$10,000 per year for life? That's ridiculous. The average new policy costs about $2,700 per year for a 59-year old.

 
$10,000 per year for life? That's ridiculous. The average new policy costs about $2,700 per year for a 59-year old.
 I was giving an example (and really one for a couple).  You can really build these policies up with certain things and they can easily top $10k.  If you have a short waiting/elimination period of only say 30 or 60 days, a daily benefit of $250+, and a benefit period of 10 years - indemnified, with a full non-forfeiture rider (cumulative premiums minus any claims paid to a beneficiary at death - so it's like a life insurance policy).....premiums could be even more than that.  Just depends on the policy. 

 
LongTimeBucsFan said:
Not all long-term care insurance policies are the same. Large group plans like the federal employee plan, don't have to comply with each state's rate increase regulations. A friend of mine purchased a policy with guaranteed level premiums. He was a little younger than you (about 45) when he got it. The premiums are fixed for life. In fact, he set his up where he'd only pay for 20 years so when he retires at 65 it'll be paid up.
Just got a mailer for this. Plan to send it in for a quote.

 
matttyl said:
 I was giving an example (and really one for a couple).  You can really build these policies up with certain things and they can easily top $10k.  If you have a short waiting/elimination period of only say 30 or 60 days, a daily benefit of $250+, and a benefit period of 10 years - indemnified, with a full non-forfeiture rider (cumulative premiums minus any claims paid to a beneficiary at death - so it's like a life insurance policy).....premiums could be even more than that.  Just depends on the policy. 
If someone spends $10,000 per year on long-term care insurance, they are dumb! 
 

 
I disagree.  There are many ways to purchase LTC insurance, each with pros and cons and it ultimately depends on what the client is trying to accomplish.  Usually the premiums are $200-300 per month, but a couple months ago I wrote a couple a whole life policy with LTC rider that has a lifetime benefit for $30,000 per year payable over 10 years.  Sure that's a lot to your average person, but they have the money and didn't want to burden their kids with LTC.  They could have self-funded as well, but wanted the security of protecting against an extended care event.
Who's doing those?  And how?  Are those 2nd to die life policies?  Or did you write two separate contracts?

 
Who's doing those?  And how?  Are those 2nd to die life policies?  Or did you write two separate contracts?
OneAmerica.

It is a 2nd to die policy.

One contract, covers both spouses.

Base policy is whole life insurance.

Rider is a tax-qualified LTCi policy with an unlimited benefit period.

 
Sounds good, and thanks.  I've done a few WL policies with an LTC rider (the rider is only a few hundred dollars on a few thousand dollar premium, so it's like "why not") but I haven't seen it done on a second to die.  You can also tie it to a 10 or 20 pay model which is sweet.  I try to steer clear of making a MEC....

I've also not seen an LTC rider for a life policy which has an "unlimited benefit period", which I understand is simply tied back to the death benefit - so it's not really an unlimited benefit.  I'll look into that.

 
Sounds good, and thanks.  I've done a few WL policies with an LTC rider (the rider is only a few hundred dollars on a few thousand dollar premium, so it's like "why not") but I haven't seen it done on a second to die.  You can also tie it to a 10 or 20 pay model which is sweet.  I try to steer clear of making a MEC....

I've also not seen an LTC rider for a life policy which has an "unlimited benefit period", which I understand is simply tied back to the death benefit - so it's not really an unlimited benefit.  I'll look into that.
The LTC rider on the OneAmerica policy is an unlimited benefit period.

It's available in every state except New York.

 
The LTC rider on the OneAmerica policy is an unlimited benefit period.

It's available in every state except New York.
Correct, but it's being "paid" of the death benefit of the life policy it's attached to.  Right?  So while the benefit period may be unlimited, the actual benefit itself will end when the death benefit is all dried up?

 
Like most LTC riders attached to life policies (probably all of them, but not sure if there are any exceptions) you deplete the death benefit before the rider starts providing benefits.  This one is truly a lifetime benefit.  I will say that IMHO the lifetime benefit doesn't make much sense for most people.  It costs a lot more than the other continuation of benefit riders.  Don't quote me on this since I don't write a ton of these, but I think you can even mix and match the inflation protection and do something like no inflation protection on the base policy but give the rider inflation protection.
Actually, I've never heard of that.  All the LTCi riders I'm familiar with (which aren't many, to be honest - I really just write with a single carrier on these types of deals) is where the rider simply allows you to "borrow" against your death benefit to pay for LTC expenses, and you can generally borrow up to 90% of the death benefit.  Once that's done, you're out of LTC benefits. 

So on a $1m life policy, you can get up to 900k in LTC expenses before it's all dried up, and your beneficiary will get the remaining 100k at your death (this if course is before dividends and such are calculated in).  The LTC rider doesn't cost much, but it allows you to borrow against your death benefit, not your cash value (and it's a lien not a loan) in the event of an LTC need.

And I've never seen it able to be put on a 2nd to die contract.  Interesting.....

 
Last edited by a moderator:
I don't really write any life insurance with just an LTC acceleration of benefits rider.  It may just be my own prejudice, but I try to separate LTC from life insurance and am not a big believer in permanent life insurance as I've come across so many poorly written and underfunded ULs.
I try to as well.  But I'm a big believer in permanent life insurance, but I've also never written a single UL.  It's all whole life to me.  If most people did an honest side by side comparison before a decent whole life policy and a "buy term and invest the difference", I think they'd be surprised. 

 
Actually, I've never heard of that.  All the LTCi riders I'm familiar with (which aren't many, to be honest - I really just write with a single carrier on these types of deals) is where the rider simply allows you to "borrow" against your death benefit to pay for LTC expenses, and you can generally borrow up to 90% of the death benefit.  Once that's done, you're out of LTC benefits. 

So on a $1m life policy, you can get up to 900k in LTC expenses before it's all dried up, and your beneficiary will get the remaining 100k at your death (this if course is before dividends and such are calculated in).  The LTC rider doesn't cost much, but it allows you to borrow against your death benefit, not your cash value (and it's a lien not a loan) in the event of an LTC need.

And I've never seen it able to be put on a 2nd to die contract.  Interesting.....
The OneAmerica policy uses the death benefit to pay for care first. Once the death benefit is exhausted the LTC rider kicks in. The LTC rider has no limit on how long it can pay the long term care benefits.

 
The OneAmerica policy uses the death benefit to pay for care first. Once the death benefit is exhausted the LTC rider kicks in. The LTC rider has no limit on how long it can pay the long term care benefits.
Looked into a bit yesterday (called a buddy of mine that knows more about this product than I do).  He described it an interesting way - it's like actually being able to buy a unlimited benefit period "stand alone" LTC policy, but with a waiting/elimination period equal to the total exhaustion of the life policy's death benefit (which would take years, most likely).  Interesting product - but I'm not crazy about it for two reasons - it's a second to die life policy, so I'm not sure how well this would protect LTC situations of both spouses simultaneously (I'm sure you can do two individual life contracts, though)- and as mentioned elsewhere, it's a life policy base and if the individual actually needed life coverage, it could be gone if a LTC need arises (I'm more of the thinking of separating those two needs, if possible). 

 
 it's like actually being able to buy a unlimited benefit period "stand alone" LTC policy, but with a waiting/elimination period equal to the total exhaustion of the life policy's death benefit (which would take years, most likely).  
It only takes 25 months to exhaust the death benefit, then the LTC rider kicks in.

Also, the LTC rider premium is tax-deductible.

 
Lbut I'm not crazy about it for two reasons - it's a second to die life policy, so I'm not sure how well this would protect LTC situations of both spouses simultaneously 
If both spouses need care simultaneously, the monthly benefit is paid for each spouse. The death benefit is used up in 12.5 months, then the LTC rider kicks in. They both get the full monthly benefit. It's perfect for spouses.

 
 it's a life policy base and if the individual actually needed life coverage, it could be gone if a LTC need arises (I'm more of the thinking of separating those two needs, if possible). 
If someone needs life insurance they should not buy a hybrid policy. That's obvious, isn't it?

 
It only takes 25 months to exhaust the death benefit, then the LTC rider kicks in.

Also, the LTC rider premium is tax-deductible.
Deductibility depends on the person.  Not everyone can deduct it, right?  It goes into medical expenses which have to reach a threshold. 

So the death benefit is gone in only 25 months?  What if it's a $1m policy?  You aren't likely going through $1m in only 25 months - that's $40k a month. 

 
If someone needs life insurance they should not buy a hybrid policy. That's obvious, isn't it?
Maybe, maybe not.  LTC and life policies are underwritten differently.  They might get extremely highly rated, or even declined for the LTC (I've seen it, from a potential cognitive standpoint), where a life policy wouldn't be an issue.  Not an everyday situation, though. 

 
Deductibility depends on the person.  Not everyone can deduct it, right?  It goes into medical expenses which have to reach a threshold. 

So the death benefit is gone in only 25 months?  What if it's a $1m policy?  You aren't likely going through $1m in only 25 months - that's $40k a month. 
Business owners/self-employed can deduct LTCi premiums off the top of their incomes on the front of form 1040. They don't need to itemize.

The purpose of this product is to pay for long-term care. Since the LTC rider is unlimited you don't need a million dollar death benefit. A $250K death benefit will provide LTC benefits of $10K per month per spouse forever.

 
Will long term care costs (nursing homes) skyrocket after all this COVID19 stuff?

Will they have new standards/regulations that will eventually cost the residents more money?

 

Users who are viewing this thread

Back
Top