Long-Term Care Insurance in Action
Bob and Cathy purchased long-term care insurance policies through their association 20 years ago. Their association encouraged the purchase of long-term care insurance to its members. They received a 5% discount off of their premium for being part of the association. At the time of purchase, Bob was 67 and his wife, Cathy was 55. They were both in excellent health. Over the years, their rates went up and they debated whether they should lower their benefits. The original agent on the policy has since left the industry but our office continues to service the needs of the client.
An unexpected change in health
However, in 2018 Bob was diagnosed with Parkinson’s Disease at age 83. Bob was doing well until he had a hip replacement surgery at the beginning of this year at age 87. Cathy, age 75 is now providing a lot of his care along with a home health aide approved through Medicare. The doctor originally thought that Bob’s condition would improve. Unfortunately, Bob doesn’t appear to be improving and Cathy can no longer provide the amount of care that is needed.
The power of an inflation rider
Bob will be filing a claim for his long-term care insurance. His policy originally started with a benefit of $125/day, it has inflated to $244/day. The average cost of a home health care aide in his area is $28/hour. With his policy, he will be able to access up to 8 hours of care per day. This is an enormous help to Cathy. She can still attend her book club and bible study meetings. This also saves them from spending their assets. Since Cathy is much younger than Bob, she will need those assets to maintain her lifestyle in the years to come.
The shared care rider as a back up
Bob’s policy has a total lifetime benefit of $267,000+ and he has the shared care rider. This means when he exhausts his policy, he could access Cathy’s policy for additional benefits.
Long-term care insurance can be a lifeline to those families that are providing care to their loved ones. Our health can change unexpectedly and if we do not plan, our families are the ones shouldering the burden.
Are your clients part of an association? Would they be willing to introduce you to the association leader to establish a discount for its members? Discounts are also available for those who share a common employer and the employer is not responsible for the premium.
Please contact a member of our marketing team to find out what discounts are available in your state. We can be reached at 1-800-945-1953