Insurance is all about planning for the “what if’s,” by protecting yourself and your loved ones, against worst-case scenarios.
As you age, these coverage decisions become more complex — and costly — to plan for the possibility that you’ll be unable to work or to take care of yourself (or both) for an extended period.
“Just because you’re healthy now doesn’t mean you can’t have something happen to you that’s going to require care,” says Jonas Roeser, co-founder and CEO of AgentReview.com. “That could mean a month and a half of care after a motorcycle accident or regular help with bathing after the age of 80.”
Weighing disability and long-term care policies
So, if you’re over 50, which should you be buying: a long-term disability insurance policy or a long-term care policy?
First, a shorthand description of each: Long-term disability insurance typically pays 60% of your wages, if you are can’t work, until age 65, and can be used to supplement Social Security disability payments. Long-term care insurance kicks in — at any age — when you can’t perform two of six functions of daily living, such as feeding and dressing yourself.
Insurance experts predictably recommend having both long-term types of policies. But if you can’t afford the separate premiums, here’s how to decide which is a smar…………… continues on MarketWatch
Kansans who bought long-term care insurance hit with double-digit rate increases
News from Topeka Capital Journal:
Some Kansans who bought long-term care insurance got an unpleasant surprise this year when they received notice their premiums would rise by double digits.
A customer of Continental Casualty Company contacted The Topeka Capital-Journal after receiving notice that premiums for herself and her husband would rise by 60 percent. The Kansas Insurance Department confirmed the notice was authentic, and said many companies have had to pass on substantial increases to their customers.
Cindy Hermes, director of public outreach for the insurance department, said companies began offering long-term care insurance in the 1970s and 80s, and didn’t realize how long their customers would live. In the beginning, they set prices too low for what they eventually would have to pay out, she said, and most companies asked for “double digit” increases this year.
“They didn’t price policies for what was going to happen,” she said.
Hermes acknowledged rate increases of 60 percent or more are painful to consumers, but said the insurance department has an obligation to balance the company’s solvency and costs to its customers. Continental didn’t respond to a request for comment.
“We negotiate it as low as we can get it,” Hermes said. “When (the request to raise rates) came in, it may have been 150 percent or 200 percent.”
Craig Van Aalst, assistant direct…………… continues on Topeka Capital Journal