<p>Good thinking about the family history. Both of my grandmothers had strokes and were in skilled nursing for 3-5 years. Otherwise my family is healthy and my parents are going strong at 82 & 83.</p>
<p>We’ll make an appointment to see our insurance guy this month and see what the options and costs are. We’re curious to know what the percent increase in premiums has been over the past 2 years and if there’s a cap on annual increases.</p>
<p>My son and I are the volleyball players, Chardo, although not so much lately ;)</p>
<p>One other issue is available assets to “self” insure, to decide if that’s a good way to go, as well as current and likely future premium rates. If you won’t be able to comfortably pay premiums for several decades, you may not have coverage when you most need it. The policies I’ve studied all are “term” ones and only continue while premiums are paid. There may be other kinds out there, but you should project things out to be sure you can afford these premiums (which may increase over time).</p>
<p>Vballmom, premium increases have varied widely, depending on carrier, sex, and benefits. Inflation protection has been the biggest culprit. Those automatic 5% increases have become extremely expensive for the carriers, thanks to the low interest on their investments. There is no cap on future increases, though each state must approve them. </p>
<p>Both my sons play, including S1 for Alabama.</p>
<p>We have seen planners use another strategy for certain people. Buy life insurance instead. If someone has the assets to pay for care if needed, but doesn’t want to risk losing it all, it can make sense. The life insurance would replenish the money spent on care, preserving inheritance for the family. If no care is needed, it’s a tax free windfall. And unlike LTC insurance, it’s guaranteed to pay back more than you pay in.</p>
<p>You can even buy life insurance with an LTC rider, allowing you to tap the death benefit while living to pay for long term care. Another way of eliminating the “what if I never use it” issue.</p>
<p>An update: we saw our insurance guy last week. The main difference in LTC policy terms now vs when we got our quote 2 years ago is the inflation protection; our quote from 2 years ago included a 5% compounded increase in the daily benefit, while the quote now only covers a 3% compounded increase in the daily benefit. The increase in premium from 2011 is $300/year. To get the full 5% inflation protection would cost $2000/year more than it did 2 years ago. Our agent said the premium has never changed in the 30+ years he’s sold this type of insurance; once you sign up for it, the premium price is locked in. He says the CA Dept of Insurance is a royal pain to work with and companies don’t go back for rate increases on existing customers.</p>
<p>I’m a bit concerned about inflation since health care seems to be increasing at a faster rate than overall inflation. I also remember the craziness of the 1980s. We might go with the 5% protection but are still crunching numbers. Either way, we’re going to sign up.</p>
<p>An anecdote about a client of his: the client had heart disease and diabetes. The client wanted term life and LTC insurance. The insurance company said no way to the term life but gave him LTC insurance with no problem. The underwriters love to sell LTC insurance to people who will most likely die quickly.</p>
<p>I work for a financial advisor who offers LTC as part of retirement planning. Things have changed drastically in the past few years. Premiums are going up and benefits are going down. One of the reps we work with is beside herself trying to keep up with all the changes happening so fast. Be very cautious and ask lots of questions when considering a policy. They no longer offer as much peace of mind as in the past.</p>