Six Ways to Reduce the Cost of Long-Term Care Insurance
You may find that long term care salespeople want to sell you the most expensive policy. while we believe that you should have complete coverage (inflation protection, lifetime coverage, at least $100 per day benefit) it is better to have at least a basic policy than to have none at all.
In order to help you minimize the cost of insurance, here are six ways to help you reduce costs and insure that you have basic coverage.
None of us know when such a health catastrophe can strike. Onset of heart attack, stroke, cancer, Parkinson's and Alzheimer's are debilitating illnesses which give no advance warning. Here are six ways to get covered at a lower cost.
Steps to Lower Your Long Term Care Insurance Costs:
- Reduce the coverage period. Reduce the term of the plan from four years to three years. Savings can still be significant and a three year policy covers 80$ of the cases of long-term care.
- Reduce the daily benefit. The actual cost of nursing care averages $130 per day. If you cover just $100 or $90 per day with insurance, may people can make up the difference with social security or interest income.
- If you are age 80 or over, consider dropping the inflation Protection. If you need long-term care you will likely need it within 10 years...by age 85. Therefore, you do not need to protect for inflation over as long a period of time, as for example, a 65 year-old would need to prepare.
- Consider partial home care coverage. Many companies offer, as an example, $130 per day benefit for nursing home payments and 50%-70% ($65/-97 day) for home care payments. By reducing the benefits for home care you can lower your premium.
- Eliminate home care insurance. Many people have a spouse, friends, or relatives that can assist them in the home. Hired home aides are relatively inexpensive ($12-$15 per hour). Care at home may easily be covered within the means of your own income. The most important coverage to obtain is for care outside the home.
- Consider the return of premium option. Although this makes the monthly premium more expensive, some or all (depending on the company) of the premiums you pay will be refunded to you if you do not use the insurance. This makes the overall cost of insurance very inexpensive for those fortunate people who do not incur long term care expenses.
Good Luck to You,
Jan Pinney
