Introduction to Long Term Care Insurance

There are many different forms of insurance available to the average person. Long term care insurance is designed to take in the cost of an aging society.

Of all of the various elements of the personal financial planning process, risk management and insurance is both the least enjoyable to consider and the most important to consider. There is nothing as certain as the uncertainty of life. No matter how much money you are earning or how wisely you are investing it, a sudden disaster can knock all of your careful plans over like a stack of blocks. Insurance is the most common method of managing these uncertainties and making sure that yourself and the people who depend on you are protecting as much as is possible.

The most common forms of Insurance are Life Insurance and Health Insurance. People feel they are fairly well protected with these against either illness or death. There is an area in between illness and death, however, that needs to be considered. This is the need for long term care. Long term care is usually defined as the need for assistance in performing the basic functions of life such as eating, dressing, mobility, etc. The problem is that most Health Insurance Policies will not provide coverage for long term care. The person is no longer suffering from a medical problem, but can no longer properly care for themselves without assistance.

In the United States, Medicaid will pay for this assisted living if the person has no funds or other means of paying. It is the person with assets who is in trouble. The cost of assisted living is high and can quickly eat away the savings and funds that were intended for other purposes. This is the basis for Long Term Care Insurance. It is a policy that is designed to provide the funds needed to pay for this assisted care so that your other assets can continue to do what you intended them to do.

Long Term Care Insurance Policies are generally sold by the same Companies that provide your Life Insurance Policies. Indeed, there are some Life Insurance Policies that have provisions for a certain portion of your death benefit to become available in the case that long term care becomes necessary. In other cases, the Long Term Care Insurance policy is a separate contract that has its own restrictions, exclusions, and benefits. The costs of the policies will vary depending on a number of factors. The age of the person purchasing the policy will be one of the most important considerations. It will normally involve a Medical examination also to determine the premium rate.

Your Insurance Agent can explain the benefits and the costs. It is important to understand what would be covered and what would be excluded in the same manner as evaluating a health insurance plan. It is also to remember that it is estimated that almost 40% of the people that require paid assisted living and long term care are between the ages of 18 and 65. Although many people think of long term care as a need of old age, this is not always the case.

By Barry Waxler

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