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Old 03-09-2011, 01:10 PM   #41
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Do you know if they care if you have a parent who had Alzheimers? Well, I mean do they deny you?
A parent with Alzheimer's won't change the underwriting for the applicant, so no, they won't deny you for that.
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Old 03-09-2011, 10:10 PM   #42
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Folks, insurance is about risk. You have homeowner's insurance. Auto insurance. Umbrella insurance. Health insurance. Long term care is insurance. You hope like heck you won't need any of your insurance policies; but, you're darn happy you have insurance when you do need it.

Would you think about dropping your homeowner's insurance just because you didn't have a mortgage and you thought the premium was too high? Would you drop your auto insurance because your rates went up? Would you not have health insurance because you feel good today? What if you had a loss? Could you pay for it out of your pocket?

LTC just isn't that complicated. I bet most of you haven't spent this much time on your homeowner's or auto insurance policies. For us, LTC is a necessary part of our financial plan. For some of you, it's all about the premium. No one is going to convince the nay-sayers of the need for LTC. They're dug in deep.

I appreciate dgoldenz's thoroughness and thoughtfulness in answering LTC questions.
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Old 03-09-2011, 10:43 PM   #43
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Would you drop your auto insurance because your rates went up?
Of course. I would and I did.

It's not all about "you need insurance" so you have to buy it at any cost. It's about assessing risk and the cost to transfer that risk to the insurance company. If the insurance is unreasonably priced, then I may decide to retain that risk.
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Old 03-09-2011, 11:09 PM   #44
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LTC just isn't that complicated.
Then why is it that some of the biggest insurance companies in America can't figure out how much to charge for it? They either get out of the business or surprise their policyholders with escalating rates.

It's dang expensive. And it's very hard to buy the type of true insurance many of us would like (tell me where I can get a policy with an 18 month exclusion period, 6 year shared benefit).

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I appreciate dgoldenz's thoroughness and thoughtfulness in answering LTC questions.
As do I.
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Old 03-10-2011, 07:05 AM   #45
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Originally Posted by East Texas View Post
Folks, insurance is about risk. You have homeowner's insurance. Auto insurance. Umbrella insurance. Health insurance. Long term care is insurance. You hope like heck you won't need any of your insurance policies; but, you're darn happy you have insurance when you do need it.

Would you think about dropping your homeowner's insurance just because you didn't have a mortgage and you thought the premium was too high? Would you drop your auto insurance because your rates went up? Would you not have health insurance because you feel good today? What if you had a loss? Could you pay for it out of your pocket?

LTC just isn't that complicated. I bet most of you haven't spent this much time on your homeowner's or auto insurance policies. For us, LTC is a necessary part of our financial plan. For some of you, it's all about the premium. No one is going to convince the nay-sayers of the need for LTC. They're dug in deep.

I appreciate dgoldenz's thoroughness and thoughtfulness in answering LTC questions.
Not so fast, hoss. LTC is a very different animal than auto and home insurance. With auto and home you pay a set price for protection of an asset and liability coverage. Simple product, straight forward pricing, and the industry has many decades of data on such losses that cover the full cycle of these policies. Life insurance looks like that too. The consumer achieves full (subject to policy limits) and clear risk transference for a firm price and the coverage/claims is proximate to the initiation of the policy/payment of premiums.

In contrast, the industry has a hazy notion at best of how to price LTC, very little data, premiums are paid for decades prior to most policy benefit payouts, and the price is not set up front. This is not simple risk transference and it is not transparent, except in the (very expensive) case of the single pay policies. This is not a simple product and it is not a clear winner for the consumer.

I also appreciate dgoldenz's input (and his thick skin).
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Old 03-10-2011, 07:31 AM   #46
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Of course. I would and I did.

It's not all about "you need insurance" so you have to buy it at any cost. It's about assessing risk and the cost to transfer that risk to the insurance company. If the insurance is unreasonably priced, then I may decide to retain that risk.
You would be willing to self insure. Then if you or your family members were in an accident for which you/they were legally responsible, you would be able to pay all medical and physical damage costs to the other party? Let's put it this way. If an uninsured motorist caused harm to your family, would you just shrug your shoulders and tell him you understand they can't pay your families' medical bills because they didn't have insurance because it was just too was just too high? Or if they didn't carry enough insurance and you had to dig in your pocket to pay the rest of the expenses?

Personally, I think all of the auto insurance should be no-fault. Each person carries as much insurance as they feel they would need. If you chose not to insure yourself, then you absorb all of the costs of an accident regardless of fault.

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Not so fast, hoss. LTC is a very different animal than auto and home insurance. With auto and home you pay a set price for protection of an asset and liability coverage. Simple product, straight forward pricing, and the industry has many decades of data on such losses that cover the full cycle of these policies. Life insurance looks like that too. The consumer achieves full (subject to policy limits) and clear risk transference for a firm price and the coverage/claims is proximate to the initiation of the policy/payment of premiums.

In contrast, the industry has a hazy notion at best of how to price LTC, very little data, premiums are paid for decades prior to most policy benefit payouts, and the price is not set up front. This is not simple risk transference and it is not transparent, except in the (very expensive) case of the single pay policies. This is not a simple product and it is not a clear winner for the consumer.

I also appreciate dgoldenz's input (and his thick skin).
I don't know where you live; but, my auto and homeowner's rates go up just about every year. That's excluding the inflation factor built into my homeowner's policy to increase coverage. My LTC premium has been flat for the last seven years.

Quote:
In contrast, the industry has a hazy notion at best of how to price LTC, very little data, premiums are paid for decades prior to most policy benefit payouts, and the price is not set up front.
Ask anyone who's lived anywhere near the Gulf Coast about their windstorm premiums for their homes over the past several years. They've bounced all over the place to the point where some companies have discontinued the coverage. That's just as hazy as the infant LTC industry (compared to the other types of insurance) has had in trying to find their equilibrium.
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Old 03-10-2011, 07:47 AM   #47
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Sure, you have annual rate resets for auto and home. But you can go shop the policy frequently and the interval of coverage is short. With LTC you can dump in premiums for a decade, get hit with massive rate increases and be stuck.
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Old 03-10-2011, 08:47 AM   #48
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You would be willing to self insure. Then if you or your family members were in an accident for which you/they were legally responsible, you would be able to pay all medical and physical damage costs to the other party?
That's liability insurance, which is NOT the same as auto insurance. Your analogy that LTC is like any other kind of insurance does not hold up in this example. Besides, the value received compared to the rate paid IS an important consideration, even for liability insurance. I do not buy the maximum coverage offered by the insurance company for the maximum price requested. I make choices based on how I value the risk and what price I am willing to pay to shift that risk. Likewise, I do not necessarily buy earthquake or flood riders unless I live in an area where I am concerned about those possibilities.
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Old 03-10-2011, 04:38 PM   #49
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That's liability insurance, which is NOT the same as auto insurance.
Auto insurance consists of liability and usually physical damage coverages. It sounds like you might have the minimum liability limits for the state in which you live since you say you're willing to take a risk with your coverages.

Auto insurance, just like LTC, give you options on coverages. The liability coverages (excluding Uninsured Motorist coverages) under auto are third party coverages - they protect people and property you injure or damage. Medical payments and Personal Injury Protection provide coverage for the people in your car. You can chose the limits of coverage you want under MedPay and PIP just like you can chose the limits of coverage you want under LTC. MedPay, PIP, and LTC are optional.

In the case of MedPay and PIP, fault does not have to be determined.

This shifts over to risk. You don't have to carry any insurance at all unless you have property that has a lien or you work for a company that requires you drive your own car for work. You don't have to carry health insurance, life insurance, or LTC. By not doing so, you assume the risk of the costs for care. That's OK up to a point.

Let's say you chose not to carry any insurance at all and there is a situation that requires costly medical intervention as well as extended care. It makes no difference if it's an auto accident, a fall off your roof, a stroke - something significant that impacts your ability to provide income needed to support your family. So you drain your savings. There's no income. There's no insurance to cover the medical bills.

If you are personally assuming the risk, then that's OK. Unfortunately, the extended cost of your care could shift over to taxpayers at one point and for those of us doing what we feel is the right thing by carrying the appropriate insurance are now asked to take care of you because you wanted to assume the risk.

The flip side of this, with you wanting to assume risk, is if you are penniless and require extended care - you have high odds of getting the caretaker who may not have the appropriate skill level for your needs.

You need to balance the money you feel you're saving by reducing or eliminating coverages and insurance with the risk. Unfortunately, the vast majority of people understate their long-term risk and the cost to mitigate the loss.

In my case, the annual premium I pay for LTC is 2% of the annual cost of a nursing home. Plus I have coverage for in-home care as well as physical alterations to my home to allow me to continue to stay there with a caretaker of my choice. There are some licensing things that have to be met; however, I have the final decision on my care.

Let's just call it a draw. There are several of you who are adamant you will never purchase long term care. There are several of us who have it as an integral part of our financial plan.

I also suspect those of us who have LTC also carry high liability limits on our auto and homeowner policies and probably also own an umbrella policy. Not that we have great risk that something will happen; we want to be prepared if and, more likely, when it happens.

We're fortunate we live in a place where we have choices. And that's fine as long as the final result for your decision to reduce or eliminate insurance does not impact the rest of us.
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Worry About the Companies' Longevity....
Old 03-10-2011, 04:45 PM   #50
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Worry About the Companies' Longevity....

I am trying to decide on which insurance company to purchase my LTC from.......I already have life insurance policies from Genworth (originally from First Colony). Should I go with Genworth again, or another company such as John Hancock or Mutual of Omaha?

In other words....what do you guys think of Genworth? It used to be owned by GE. I think that is no longer the case. Genworth is not as highly rated as the other companies I mentioned (those multiple ratings such as AM Best, Moody's, etc). Should I worry about Genworth being around in 20-30 years when I may need to make a LTC claim?



Thanks.
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Old 03-10-2011, 04:56 PM   #51
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20-30 year horizon creates a risk for any carrier, IMHO. Unlike annuities, for example, I am not aware of any state safety net on LTC.
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As if you didn't know..If the above message contains medical content, it's NOT intended as advice, and may not be accurate, applicable or sufficient. Don't rely on it for any purpose. Consult your own doctor for all medical advice.
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Old 03-10-2011, 05:57 PM   #52
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Both our LTC policies are with John Hancock.

ETA: When I wanted LTC, I called USAA - who I trust completely. They gave me a quote for John Hancock LTC. Knowing how picky USAA is with their business partners, I had absolutely no problem going with JH.

If you are a USAA member, call them. I got a group discount and also a discount for paying annually.
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Old 03-10-2011, 06:27 PM   #53
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For those that gave compliments, thanks!

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Originally Posted by East Texas View Post
Both our LTC policies are with John Hancock.

ETA: When I wanted LTC, I called USAA - who I trust completely. They gave me a quote for John Hancock LTC. Knowing how picky USAA is with their business partners, I had absolutely no problem going with JH.

If you are a USAA member, call them. I got a group discount and also a discount for paying annually.
JH used to be very competitive with Genworth until they jacked up their rates for compound inflation policies. I think they also changed the way they offer their spousal discounts, but I'd have to go back and look on that. Now they are about 50% more expensive on the various quotes I've run (double in some cases as you can see below) and aren't even close to the rates of Genworth, United/Mutual of Omaha, Transamerica, or Prudential. Every case is different, but I haven't come across any cases lately where JH was even comparable to the other leading companies.

Example:

55 year old couple, both preferred risks
90-day waiting period
0-day waiting period for home healthcare
$6000 monthly benefit
Survivorship benefit
3-year shared benefit period (6 years total)

GW - $3969/year
UoO - $4623/year
Pru - $5173/year (going up ~40% in April too)
TA - $5814/year
JH - $7755/year
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Old 03-10-2011, 06:58 PM   #54
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For those that gave compliments, thanks!



JH used to be very competitive with Genworth until they jacked up their rates for compound inflation policies. I think they also changed the way they offer their spousal discounts, but I'd have to go back and look on that. Now they are about 50% more expensive on the various quotes I've run (double in some cases as you can see below) and aren't even close to the rates of Genworth, United/Mutual of Omaha, Transamerica, or Prudential. Every case is different, but I haven't come across any cases lately where JH was even comparable to the other leading companies.

Example:

55 year old couple, both preferred risks
90-day waiting period
0-day waiting period for home healthcare
$6000 monthly benefit
Survivorship benefit
3-year shared benefit period (6 years total)

GW - $3969/year
UoO - $4623/year
Pru - $5173/year (going up ~40% in April too)
TA - $5814/year
JH - $7755/year


I still need to know if Genworth is a good enough company to enter into a long term contract with.....anyone else have an opinion on this company?
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Old 03-10-2011, 08:04 PM   #55
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This link might help you with your decision. Even though it's from the Texas Department of Insurance (I'm not sure where you live), the information is good.

A Shopper's Guide to Long-Term Care Insurance from the Texas Department of Insurance
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