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Old 09-15-2021, 10:50 AM   #21
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Wife and I got a hybrid LTC/whole life joint policy for single premium when I was 69 and she was 62 with 3% inflation rider. Covers either or both of us under one policy. Since it was one pay (or ten pay was another option) premium is set and done--never any increase possible. Also, since it is hybrid, if LTC never or not completely used, then heirs collect on the life insurance, so never any "wasted premiums for all those years" feeling (if one tends to look at LTC that way).

Final and best plus of policy is the leverage. For that single premium one gets an "immediate" multiple of the single premium amount as benefit coverage. This leverage is both on the LTC side, and also on the life insurance side. So if we individual mere mortals turned out to need LTC the week after we bought the policy, we have a multiple of our single premium to cover us. Or if we kicked the bucked the month after we bought the policy, again the heirs get a multiple of our single premium.

The coverage is in effect, paid for, either I or my heirs get a multiple of the single premium back at some point. I am not going to cancel and ask for refund! (Which is another option).
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Old 09-15-2021, 10:57 AM   #22
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Both DH and I have had LTCI . We purchased through our employers ~20-25 years ago. Currently have $360/day with lifetime limit of approx. $400K. DH at 74, pays $2,500 a year now and just received an offer (I haven't received mine yet) to increase daily coverage to $417 for an add'l yearly premium of $1,430. We plan on declining their 'generous' offer . The mailer also stated, oh by the way, the company is in the process of implementing rate increases.

Nursing home care in our neck of the woods is outrageously expensive at approx. $10K/month for a semi-private room.
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Old 09-15-2021, 11:00 AM   #23
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Originally Posted by phil1ben View Post
I have not and will not buy it.

My MIL just passed away at 85. She spent $1700.00/year since 1996 for the policy. It came with a 100 day elimination period (deductible) meaning she had to out-of-pocket for 100 days before the insurance company paid anything. Long story short, she went into assisted living in June and passed away September 1.

She was not able to use one nickel of the policy. Although I understand some viewing this as "catastrophe insurance" I believe the majority of people pass without being able to collect anything.

Yes, I understand that is how insurance works........but I thought I would relate a real life experience with real dollars.
Good point. I guess a fair amount of people do pass away in that first 100 days. I guess that is why they make you wait that long.
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Old 09-15-2021, 11:47 AM   #24
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DW and I also went for the hybrid life / LTCI policy for all the same reasons mentioned by RetireeRobert.

Purchased our policy almost 3 years ago at age 62. Life insurance part paid by lump sum IRA rollover which disburses over 10 years. Also added a rider to include unlimited LTC coverage with 5% inflation. This is also distributed over 10 years and is paid from our HSA so tax free.

We were very concerned about all the huge price increases occurring with traditional policies. This is one way to avoid that risk. The life insurance for the kids on our passing is just gravy.
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Old 09-15-2021, 12:56 PM   #25
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Quote:
Originally Posted by RetireeRobert View Post
Wife and I got a hybrid LTC/whole life joint policy for single premium when I was 69 and she was 62 with 3% inflation rider. Covers either or both of us under one policy. Since it was one pay (or ten pay was another option) premium is set and done--never any increase possible. Also, since it is hybrid, if LTC never or not completely used, then heirs collect on the life insurance, so never any "wasted premiums for all those years" feeling (if one tends to look at LTC that way).

Final and best plus of policy is the leverage. For that single premium one gets an "immediate" multiple of the single premium amount as benefit coverage. This leverage is both on the LTC side, and also on the life insurance side. So if we individual mere mortals turned out to need LTC the week after we bought the policy, we have a multiple of our single premium to cover us. Or if we kicked the bucked the month after we bought the policy, again the heirs get a multiple of our single premium.

The coverage is in effect, paid for, either I or my heirs get a multiple of the single premium back at some point. I am not going to cancel and ask for refund! (Which is another option).
I am considering a policy like this through One America . We would probably pay the full amt up front and receive a discount on the price. I can’t see too many downsides.

We are not concerned with a large payout from the death benefit to our heirs since we don’t have kids. We would be willing to take a lesser amt or forgo the payout altogether if we could get a lower upfront price. The policy has the chassis of a life insurance policy so I recognize that this is probably wishful thinking.

As far as I can tell the company is stable . I am having trouble pulling the trigger for some reason. We would move $150,000 from the IRA to fund it ( no tax implications)and be eligible for a $5729/mth benefit lifetime benefit each for me and my spouse. Any thoughts on this would be appreciated.
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Old 09-15-2021, 01:00 PM   #26
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We do not have LTCi. Our plan is to move to a CCRC in 4-5 years when my spouse will be 80 - 81 and I will be 70 - 71. It may feel early for me but I'm hopeful we will be able to afford an independent cottage on the campus that will still feel like our own home and not an institution.
Be aware that if you or your DW have a "health event" during the 4 - 5 years while you're waiting, you and/or DW may not pass their mental/physical requirements for a Type A plan. You must be totally capable of independent living when you enter.

DW and I are also looking a Type A CCRC's and find picking an entry age to be frustrating. Go in too soon and you might be wishing you were still in your own home and living that lifestyle. Wait too long and have a "health event," and you can't get in except under a Type C plan.
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Old 09-15-2021, 01:40 PM   #27
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I looked into LTCI ~ age 52. Chose not to buy it because it had already priced itself out of reasonableness. When I added up ~ 20 years of premiums before I was likely to need it, the total in premiums was very close to the maximum amount the policies would have paid out.

Given this reality, we chose to self-insure.
Same here... the numbers just didn't add up. I've made sure the primary house and some other "off book" assets are not part of my retirement calculations in order to self-insure.
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Old 09-15-2021, 01:42 PM   #28
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We have Genworth mostly because my spouse is fairly conservative financially and just felt a lot better if we had something like this, particularly after seeing how both sets of parents could have made use of it. Got it in our low 50's so cost at that time seemed reasonable. At this point I'm pretty ambivalent and have been concerned about premium inflation as we've already been through several increase requests.

The last few times I did an analysis of coverage inflation (our policy does have the COLA increase built in) vs how fast the covered healthcare services were actually appreciating in our area. I was a bit surprised that the health costs over time were increasing at a somewhat lower rate than the inflation rider, so I had them reduce the coverage (and premium) to the appropriate level. So although our premium has increased over the original amount, it's not as bad as just taking their standard suggested increase.
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Old 09-15-2021, 03:40 PM   #29
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I had posted in one of the other threads. I have Genworth LTCI, dirt cheap with high amount of coverage and with inflation rider. I have it for 12 years already without a premium increase todate. I know the increase will come one day, but I really like the policy.

My husband bought a Lincoln hybrid policy in 2016 with 1 lump sum payment.

We are both glad that we have our policies.
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Old 09-15-2021, 05:36 PM   #30
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I am considering a policy like this through One America . We would probably pay the full amt up front and receive a discount on the price. I can’t see too many downsides.

We are not concerned with a large payout from the death benefit to our heirs since we don’t have kids. We would be willing to take a lesser amt or forgo the payout altogether if we could get a lower upfront price. The policy has the chassis of a life insurance policy so I recognize that this is probably wishful thinking.

As far as I can tell the company is stable . I am having trouble pulling the trigger for some reason. We would move $150,000 from the IRA to fund it ( no tax implications)and be eligible for a $5729/mth benefit lifetime benefit each for me and my spouse. Any thoughts on this would be appreciated.
State Life/One America is also the carrier for my policy. It is AA- rated by S & P for financial strength.

You mention no kids to benefit from the life insurance, and that (to me) is "one" of the big benefits of this particular hybrid type.

However, the ability to insure both spouses under one joint policy, like One America's hybrid policy, was a larger deciding factor for me.

Also, from scanning ltcpartners webpage (which has much helpful info on One America hybrids), I did see One America is offering up to 20% credit for paying "from IRA" accounts as you mentioned you plan to do. That credit was not available when I bought my policy (dang it). That credit alone may offset the lack of your ability to benefit heirs with the life insurance death benefit.

Brainstorming: Could you perhaps assign the death benefits from this policy to some charity which sometimes offer annuity payments to donor's who assign life insurance proceeds (or other assets) to the charity upon donor's death? Maybe there is someway you can get some benefit out of One America hybrid death benefits--even though you have no heirs?
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Old 09-15-2021, 06:25 PM   #31
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OP: Do some research, and do your best to find a good insurance broker. DW and I have LTC policies with John Hancock; it's been about 10 years now. Cost is not cheap. To this day, I honestly don't know if we made the right decision in getting the coverage. In my case, though, DW was insistent on getting it so the decision was already made. I can see arguments pro and con; you need to make your own decision that you're comfortable with.
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Old 09-16-2021, 06:40 AM   #32
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We bought Prudential LTC policies in 2008. With the 5% inflation escalator, the daily rate is now $313 and a current bucket amount of $450,000 for each of us. The 3rd round of increases were instituted earlier this year and because our daily rate seemed to be rising faster than local prices, we elected to reduce the cola going forward to 2.6%. Doing that keeps the premium the same with no increase for a minimum of 3 years. It's expensive and looking at our NW now we could have elected to self insure. Having the policies though provides a good deal of peace of mind. Each of us had one parent who needed care, so we had that history as well.
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Old 09-16-2021, 07:29 AM   #33
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I am curious about how many folks have bought LTC insurance in retirement?
And at what age?
Since you asked about what age folks bought LTC policies, I'll mention that while it's interesting to know what folks did historically and to hear the fortunate stories about folks who got good deals years ago, you should really focus on what is available today.

Almost any financial product will have anecdotal examples of success. Even the dreaded variable annuities have examples where they worked out well for some folks. Whether you choose to self-insure, go into a CCRC with a Type A plan, buy a single premium hybrid policy or traditional LTCI, keep in mind that all these products have been changing over time and focus on what they look like today.
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Old 09-16-2021, 07:44 AM   #34
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Originally Posted by RetireeRobert View Post
State Life/One America is also the carrier for my policy. It is AA- rated by S & P for financial strength.

You mention no kids to benefit from the life insurance, and that (to me) is "one" of the big benefits of this particular hybrid type.

However, the ability to insure both spouses under one joint policy, like One America's hybrid policy, was a larger deciding factor for me.

Also, from scanning ltcpartners webpage (which has much helpful info on One America hybrids), I did see One America is offering up to 20% credit for paying "from IRA" accounts as you mentioned you plan to do. That credit was not available when I bought my policy (dang it). That credit alone may offset the lack of your ability to benefit heirs with the life insurance death benefit.

Brainstorming: Could you perhaps assign the death benefits from this policy to some charity which sometimes offer annuity payments to donor's who assign life insurance proceeds (or other assets) to the charity upon donor's death? Maybe there is someway you can get some benefit out of One America hybrid death benefits--even though you have no heirs?
Thanks tor the input. I had not considered the charity angle and will look into it . Having the ability to lock into a fixed price and cover both of us will probably be the overwhelming factor to go with them. It will certainly give us a good base coverage that we could supplement with other sources.

The discount is $30,000 to pay in a lump sum which is the way I would proceed. I am so naive concerning these matters and just needed to hear from someone that has been down this road.
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Old 09-16-2021, 07:51 AM   #35
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To add to my earlier post, I got mine at 46 and my husband got his at 68. We have 2 excellent policies and having been on the provider end, having LTCI is the best thing we could do for ourselves.
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Old 09-16-2021, 09:16 AM   #36
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We purchased a single premium LTC policy through NGL four years ago (when I was 50 and DW was 47)-so paid up. Inflation rider built in, will pay 70% of cost for 3 years stay for each w/90 day elimination period. Home health option also included. We both retired last Dec.

While LTC insurance is certainly a personal choice, with many pros and cons, we wouldn't have entered retirement without it. Too many situations with family members and friends over the last 15 years to reflect upon. Our experience is that those that carried LTC insurance had a much easier time securing quality care in a good facility, even in cases where their policy was mediocre at best. It also seems that many of those we know who opted to self fund LTC didn't allocate enough $. Particularly if Alzheimer's enters the equation. Yes, the average nursing home stay may be relatively brief, but certainly not always.

Again, there are negatives to purchasing LTC policies. For us the positives, including piece of mind, outweighed the negatives. ymmv
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Old 09-16-2021, 09:30 AM   #37
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My Dad had LTC and he was in a facility for a while. It paid $150 a day. I looked at prices for policies and what they cover. It just didnt seem worth it to me personally. Obviously the more coverage the more the cost

I feel I can cover those costs so decided against it
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Old 09-16-2021, 09:40 AM   #38
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No LTC insurance, self insuring for that.
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Old 09-16-2021, 10:00 AM   #39
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Our experience is that those that carried LTC insurance had a much easier time securing quality care in a good facility, even in cases where their policy was mediocre at best.
Interesting tidbit syd03. At first glance, the idea that a mediocre LTC policy would be looked at more favorably by a care provider that cash coming from a well funded "self-insured" stash seems to not pass the common sense test. I wonder why that is? I'd think that someone who is conservatively self-insured and would be paying cash would be welcomed by good facilities.

Quote:
It also seems that many of those we know who opted to self fund LTC didn't allocate enough $.
That really doesn't matter. Only what you personally would have done has any bearing on the matter. Or are you saying that you didn't trust yourself to plan and execute a self-funding scheme?
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Old 09-16-2021, 10:11 AM   #40
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For us at least, the "LTCi or self insure" decision was not binary. As I alluded above, we approached LTC insurance similar to how we view term life.

We took out our LTCi policies at age 50 when the possibility needing the insurance in the short run was slight, but the risk to our long-term financial health could have been severe. As the premiums increased over time we reached a point where, due to decreasing life spans and an increasing nest egg, we could self insure. But rather than cancel, we opted to eliminate the 5% inflation rider and keep the insurance, locking in our benefits at $267/day. This reduced our premiums substantially, back to near the level they were when we took out the policies more than 20 years ago.

YMMV
This sounds like a good approach. We'll keep it in mind should our premiums go up a second time.

Here is our current thinking on LTCi. Since we have it, we plan to keep it. We CAN afford the premiums (and probably could even if they went up substantially.) LTC is one of the few black swans (in addition to run away inflation) that we believe could derail our FIRE plan. With the concept that "you only need to insure for what you can't afford" we decided to stay with our insurance. After all, two folks in LTC at (currently) $10k/month EACH is one of the few things which could derail us even with our substantial savings. Add to this that we both have significant health issues, it's just possible we will "win" the bet with the insurance company. I hope not! YMMV
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