Thanks for the all the replies. I've got a little more info to share.
I think the agent is blowing smoke up your... Shop around and see if you can find a decent agent first, then get into policy details.
Have you fully considered the risks and alternatives with LTC? I am not a big fan of the product.
I agree--I'm not 100% sold on the whole idea of LTCi. On one hand, I don't think we can (realistically) self-insure for the entire amount we might face if one or both of us ends up in "the home," but I'm not in love with the products themselves. I think we're very likely to see rate increases and companies go out of business.
Yes, as we guessed, it appears the agent was not being entirely truthful regarding costs from various agents. USAA doesn't sell their own LTCi, but the serve as an agent for John Hancock and Genworth. USAA offers a 5% discount from the list rate for JH, no discount for Genworth. In our case, the JH policies were approx 20% less expensive than Genworth (same features in both). I don't know if this difference would be the same for all ages/rate classes. If I recall correctly, Brewer had good things to say about both companies (though not necessarily LTC as a product) and from what I've read, JH may have a
slight edge in financial strength.
Originally posted by Nords
Is the federal LTC insurance also priced at the same rate? That used to be more expensive but I don't know how pricing has moved over the last few years.
In our case, the USAA price for the JH policy was slightly (8%) less expensive than the price under the federal LTC program. I think this would probably differ according to the health status of the applicants, as the Federal program is a group policy and (as your Dad found out) if you are in a favorable underwriting class it is a few bucks cheaper to get a policy on your own. There are other differences: All the Federal policies are for one person without any sharing of benefits between people. On the other hand, if you buy from an agent or USAA, you can pay approx 20% more and get shared benefits for a married couple, which allows the entire dollar amount to be used by one or the other (even if one party dies first, the other gets the whole shared benefit--and the premiums for the deceased person's half of the coverage stop on his/her death). That seems to me to be a fairly important benefit, and might allow us to reduce the coverage amount (and the premiums). On the other hand, I sure like the idea of OPM and all those other federal retirees being in the boat with me if the company decides to raise rates or deny benefits. You don't get that protection if you're a lone wolf (I think the state insurance departments will roll over compliantly when the insurers come pleading for rate increases. The State has nothing to lose by granting rate increases and a LOT to lose in increased Medicaid claims if insurers go bust).
The policies under the federal program are issued by a partnership of MetLife and JH. Also, the Federal LTCi web page is way out of date concerning the "state partnership programs" and it is impossible to tell if the plans they offer are in compliance. I'm sure you can get one that is, but it's a shame they haven't done a better job of keeping their web page current on this important program.
If we do decide to buy LTCi we'll still self-insure to the max extent possible.