Insure Against Long-Term Care Expenses

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Insure Against Long-Term Care Expenses

Long-term care expenses threaten all of us. The average cost of a private room in a nursing home in Connecticut is currently about $167,000 per year. If costs continue to rise at a rate of 3% per year, this expense will increase to $350,000 per year in 25 years. Home care and assisted living are also increasingly expensive. And long-term care is not covered by Medicare.

For many retired couples, if either spouse needs long-term care, these costs could impoverish them both.

Traditional long-term care insurance policies have two problems:

(1) Premiums for traditional long-term care policies are subject to increases at the insurance company’s option (following state government approval).

(2) If you don’t need long-term care, or if you stop paying premiums because they become too expensive, policy benefits are often lost. The common complaint against a traditional long-term care policy is “Use it or lose it.”

Today, there’s an alternative: Life insurance linked with long-term care insurance.

The combination of life insurance and long-term care insurance provides  protection against long-term care expenses –  without the risk of rising premiums –  and a guaranteed death benefit.

Long-term care benefits increase at a guaranteed rate until an insured begins withdrawals. Life insurance benefits are paid to the insured’s beneficiary, minus any long-term care benefits already paid out. These life insurance proceeds may offset all or a substantial portion of the premium(s) paid into the policy.

Unlike a traditional long-term care policy, either the insured receives long-term care benefits or a beneficiary receives life insurance benefits. Benefits are never lost. And both long-term care benefits and life insurance death benefits are tax-free.

Contact us to discuss a long-term care/life insurance combination that meets your needs and your budget.

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