Deciding on when to purchase a long term care policy, how much protection is right for you and what type of long term care product to buy can be overwhelming. Knowing the different types of products that are available will help you navigate the process and gain insight into what questions to ask when discussing long term care with your specialist.
Traditional Long Term Care
The major benefit of a traditional long term care policy is customization. Policies can be designed to fit the needs that are most important to you. For instance, you can choose the amount of coverage you want, you can also choose when you would like to start receiving your benefit and how long you would like it to last. These products are designed to cover virtually all long term care services. They are usually purchased with monthly, quarterly, annual and semiannual premiums paid for the life of the insured or with some abbreviated payment schedules policies can be paid up in twenty, ten or one year depending on the terms of the policy.
Hybrid or Asset Based Policies
The hybrid long term care policy is a newer model consisting of a life insurance policy or an annuity . The life insurance hybrid typically features a life insurance component with a long term care rider and provides the insured a percentage of the death benefit monthly, when triggered for Long Term Care assistance. The annuity hybrid is an investment in an annuity that also has a long term care rider. With the hybrid products, if you do not need it for long term care assistance you still receive the life insurance proceeds or your cash value in the tax deferred annuity. The cost of the long term care rider cannot be increased. Sometimes an old life insurance policy or previously purchased annuity can be converted into the new hybrid model.
Short-Term or Critical Care
The typical short-term long term care policy provides coverage for one year or less. It is a good option if you or a spouse was declined for a traditional long term care policy, if your looking for a less expensive option, you are 80 years of age or older or if you have a traditional long term care policy and would like to use this to cover an elimination period. Similar to other long term care products a short-term policy can help pay for home care, assisted living facilities and nursing home care and it is the least expensive option.
Long Term Care insurance is an important part of any financial plan to protect families and individuals. The types of products available can vary significantly and finding the product that’s best for you, your family and your retirement goals can be confusing. Make an appointment with the specialists at Affordable Long Term Care to discuss any questions you may have and to find the product that will address the needs most important to you.