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Four Considerations for Long-Term Care

In the event of a serious illness, Long-Term Care insurance can protect your family’s financial health by providing resources to cover the costs of care at a medical facility or help at home. Here are four things to consider when looking for long-term care (LTC) coverage:

Tax Implications for Long-Term Care Premiums. Depending on your individual tax circumstance, LTC premiums might be paid with pre-tax dollars. Typically, a taxpayer has to itemize their return, and the amount of your deduction has limits. It is important to talk to your tax adviser to see how the deductibility of LTC insurance will affect the amount of coverage that will fit your budget, and work with your independent insurance agent to find the right coverage for you.

Buy Long-Term Care Insurance When You Are Younger. Many who purchase LTC insurance when they are relatively young and healthy (50-65) will enjoy lower premiums than those who purchase later in life. Typically premiums will not increase on an individual basis, however, it is possible for a company to increase the premiums for a class of policyholders. Your independent insurance agent can detail under what circumstances an increase can occur, and the history of increases from an insurance carrier you are considering for LTC insurance.

Is Your Long-Term Care Insurance Company Highly Rated? Any insurance company can run into financial problems if they have a class of policyholders making unexpected claims. Usually, they will increase the premiums unless the premium is “guaranteed.” Before buying insurance, check their rating from AM Best, Standard & Poor or another agency. Talk with your agent about the history and stability of a company you are considering. It is also wise to check periodically how a company is doing – a smart move for all your insurance coverage.

Upgrade or Replace Your Long-Term Care Policy? As LTC insurance matures as a product throughout the insurance industry, you may learn of an attractive option currently offered that was not available when you purchased your current policy. Consult with your independent insurance agent about the pros and cons of changing companies. It is possible that this new option is offered by your current company at a modest cost, negating the need to switch companies.

Long-term care insurance can be a great benefit to your family. Your independent agents at O’Connor Insurance Agency are ready to help you determine if LTC coverage is right for your planning. Give our office a call at 314-434-0038 to speak with an agent about long term care insurance.

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