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Old 02-03-2021, 04:38 PM   #81
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The policy reads "unlimited," which I understand to mean "no cap."
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Old 02-03-2021, 05:43 PM   #82
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Originally Posted by leeg View Post
I have a policy with Unum through my employer. Just me, not my wife.

Here is the premium history:
2000 - $106/month, $1,272/year
2014 - increased to $186/month, $2,232/year
2021 - 311.40/month, $3,732/year

The benefits are pretty good - there is a 90 day elimination period, but the benefits have increased at 5% simple interest per year for the last 20 years - in other words, they've doubled.

Today they are (monthly):
Facility - $12,000
Assisted living- $7,200
Home health care - $6,000

I spoke with a LTC insurance expert, who thought the the $2,232/year was fantastic. She said a policy like this purchased new, today, would be over $12,000.

So, I'm hanging on for now despite the 2021 significant premium increase. Do I equivocate? Darn'd right I do, esp. after the premium rose this year. Note that in my state (Massachusetts), the Commissioner of Ins. has to approve any premium increases.

Would be curious how this policy (coverage/cost) compares to what anyone else may have.
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What's your total benefit cap?
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Originally Posted by leeg View Post
The policy reads "unlimited," which I understand to mean "no cap."
In that case, I would keep this policy if I had it. Some quick math says you'll have paid ~$100k in premiums, much of it a sunk cost, and those premiums will have a future value approaching $175-$200k) by the time you're most likely to need it. I don't know where you live but, you'd likely consume that amount with 2 yrs of care. You are exceptionally lucky to have an unlimited LTCi policy. But, exceptionally is the key word here because this policy was rare to begin with and is no longer offered.
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Old 02-03-2021, 07:02 PM   #83
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I don't know where you live but, you'd likely consume that amount with 2 yrs of care.
Massachusetts
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Hybrid LTC products
Old 02-04-2021, 07:36 AM   #84
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Hybrid LTC products

Hi, I quickly browsed through the replies and have not seen anyome mention the Hybrid LTC products. It's a very personal decision whether you feel you need LTC and people fall equally on both sides of argument.We are currently looking into this type of LTC product and have received 2 quotes, one from Mass Mutual, the other from NY Life. The hybrid products provide a death benefit if you do not end up using it for the LTC . Still expensive but at least your heirs get some $$ back for your investment. Also, there are no annual premiums as you pay it either up front in a lump some or over 3-5 years but with no cost increase. The question you need to ask is whether you want to insure your assets because that's what LTC insurance is really about. For us, we only have 1 DD and she is still a minor. There is longevity on both sides of our family with our parents in their 80s & 90s, one of them in assisted-living with dementia, and we retired early at 54 & 57. We want to leave some $$ for our DD and not risk burning through our assets so this is why we will be puchasing a Hybrid LTC insurance product as well as give our DD some peace of mind if/when we reach the stage where we need to be placed in an Assisted-Living or LTC facility. Hope this helps
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Old 02-04-2021, 06:24 PM   #85
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Hi, I quickly browsed through the replies and have not seen anyone mention the Hybrid LTC products.
You must have missed my earlier comments in a few posts.

Such as:

A string of comments here about the "typical" LTC policies, ruing the large premium increases, and ruing the "waste" of money paying premiums if LTC care never needed, indicates many or most readers are not aware of the "hybrid" LTC/LifeInsurance policies available such as from State Life. See more here: https://www.longtermcareinsurancepar...rance-benefits

This type of solution to LTC coverage:
guarantees never any premium increase
guarantees a death benefit to heirs if LTC never used, so premiums were not
"wasted".
can also cover both spouses under one policy, so provides more efficiency.

I'd suggest people who worry about premium increases over the years (which should be any buyer of LTC insurance), and people who don't want to "waste" their premiums if they never need the LTC care, look into the "hybrid" solution.
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Old 02-04-2021, 06:26 PM   #86
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Better link here than one in my above comment:

https://www.longtermcareinsurancepar...rance-benefits
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Old 02-04-2021, 07:36 PM   #87
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Here is a LTC paper one contributor posted for us:


https://www.dropbox.com/s/cof13s70a4...rance.pdf?dl=0
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Old 02-05-2021, 02:29 PM   #88
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No need for LTCi. Too costly and EZ to self insure for us.
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Old 02-05-2021, 06:04 PM   #89
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Here is a LTC paper one contributor posted for us:


https://www.dropbox.com/s/cof13s70a4...rance.pdf?dl=0
Thanks for the link. I read through this essay. Makes a lot of good point about LTCi. Don't know who the author is or his qualifications.

But, I take exception to his comments on Hybrids, as he says he dismisses Hybrid LTC/Life Insurance policies out of hand.

He says this about them: "On the negative side, hybrid policies are 3 to 4 times more expensive than LTCi. And hybrids are akin to permanent life insurance, which means they are complicated and the economics are
difficult to decipher."

So in one breath he says economics are "difficult" to decipher, but then also says very exactly that "hybrids are 3 to 4 times more expensive than LTCi." He simply dismisses them and does not explain how he came up with his 3 to 4 time more expensive figuring (i.e. whether he was able to decipher them himself! Likely not---he just dismissed them as "too difficult!)

He does not seem to take into account "any value" at all for feature that Hybrids, at death of insureds, pay about double (depending on ages when issued) the initial premium out to heirs as life insurance, if the LTC benefits were never needed or used. Author simply assigns "no" value at all to that feature!

And he assigns no value to feature that there are "never" any premium increases!

So, Hybrids overcome main objections many have to getting LTCi at all:
1) People fear "wasting" years worth of insurance premiums for something that they may never use. With Hybrids, if you don't use it (or use all of it), your heirs get about double your premium amount back as life insurance payout. (If you use some of the LTC feature, the heirs get the remainder back as life insurance.)
2) Potential buyers fear LTCi premium increases over the years, and some fear being priced out of holding onto their insurance. With Hybrids, this is simply never a concern at all. They are either paid for with upfront single premium, or some are paid over ten years with contractual yearly payment set in contract at issue date.
3) Other potential buyers wonder how to afford coverage for "both" spouses, needing two separate policies. With some available Hybrids, both spouses can be covered under one policy with the LTCi benefits being available to either or both spouses. So, one can make a judgement on "odds" of either or both needing LTC, and choose a size of Hybrid policy such as to play their judgement on those odds. Premium efficiency of covering both spouses under one policy.


So, Hybrids solve a lot of the main objections to LTCi many have, such as the self-insurers.

What people give up to an insurance company in purchase of a Hybrid, with an upfront single premium, is excess time value of investing that single premium amount over the years. But they "do not" give up the single premium itself. Indeed, their heirs may at least double that money, if LTCi never used.

So my opinion is people should not dismiss Hybrids out of hand, like this author did, as "too difficult to understand". People, especially self-insurers, with the objections stated above should look into and consider the Hybrids as via solutions solving many of the big objections---while "still" providing peace of mind.

(Full disclosure, I am a 20 years ago retired CPA. Haven't done CPA work for pay for all that time. But I do still have my wits about me! In my opinion!)
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Old 02-05-2021, 06:33 PM   #90
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But, I take exception to his comments on Hybrids, as he says he dismisses Hybrid LTC/Life Insurance policies out of hand.
As I've said on many threads, including my answer to this one, I'm not a LTCi fan. However, I agree that the author of the LTCi analysis (which is detailed and well laid out IMO) doesn't provide enough detail on how s/he reached the conclusion regarding hybrid policies. I'd like to know how s/he concluded that hybrid policies are 3-4 times as expensive as traditional LTCi policies (I suspect it's some sort of PV analysis but, who knows?). I'm also curious why they are more complex (Is it because it's a "hybrid" of two products or the contract language is less transparent; again, who knows?).
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Old 02-06-2021, 08:26 AM   #91
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Not expressing an opinion about right/wrong but just wondering: For those who are self-insuring, have you checked what long term care costs in your area? Ours is in the vicinity of $10k/month. Based on how much you have in your stash, how long would that keep you in a nice place? Those are the numbers I ran. Turns out, we'd probably survive if only one of us needs care to a ripe old age. If both - we'd run out before a normal life span. SO, it happens that we took the plunge and got LTCi a long time ago (20+ years.) If I could go back, I probably would NOT do it - knowing what I know now. I think it's kind of over priced, but now we have it and it has only gone up in price one time. With that in mind, it seems worth keeping it in force.

Most folks assume they would need long term care for 2 or 3 years. I know OF people who have spent 10 years and more. So, you can only plan if you make some assumptions. What are folks planning? How many years? What price? How many (1 or 2) people in your assumption? I guess planning for worst case would make some of us throw up our hands, but what SHOULD one model for? Obviously, this is a YMMV situation.
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Old 02-06-2021, 09:46 AM   #92
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Not expressing an opinion about right/wrong but just wondering: For those who are self-insuring, have you checked what long term care costs in your area? Ours is in the vicinity of $10k/month. Based on how much you have in your stash, how long would that keep you in a nice place? Those are the numbers I ran. Turns out, we'd probably survive if only one of us needs care to a ripe old age. If both - we'd run out before a normal life span. SO, it happens that we took the plunge and got LTCi a long time ago (20+ years.) If I could go back, I probably would NOT do it - knowing what I know now. I think it's kind of over priced, but now we have it and it has only gone up in price one time. With that in mind, it seems worth keeping it in force.

Most folks assume they would need long term care for 2 or 3 years. I know OF people who have spent 10 years and more. So, you can only plan if you make some assumptions. What are folks planning? How many years? What price? How many (1 or 2) people in your assumption? I guess planning for worst case would make some of us throw up our hands, but what SHOULD one model for? Obviously, this is a YMMV situation.
This is the good thing about the Continuing Care Retirement Community we plan to move in. It is pricey to move into and you pay a monthly fee (the monthly feee does not go up if you have to move into skilled nursing, memory care or assisted living). But if you run out of money there is a multimillion dollar trust fund that will pay your monthly fees. I asked one time about that and I was told that there were 2 ladies both over 100 that have run out of money and the trust is paying their fees. They check your financial statement before you move in (even before you get on the waiting list) to be sure you have enough money to last for your life expectancy. There is also some language in the contract to prevent you from giving all your assets away to qualify for the trust fund.
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Old 02-06-2021, 09:51 AM   #93
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Thanks for the link. I read through this essay. Makes a lot of good point about LTCi. Don't know who the author is or his qualifications.

But, I take exception to his comments on Hybrids, as he says he dismisses Hybrid LTC/Life Insurance policies out of hand.

He says this about them: "On the negative side, hybrid policies are 3 to 4 times more expensive than LTCi. And hybrids are akin to permanent life insurance, which means they are complicated and the economics are
difficult to decipher."

So in one breath he says economics are "difficult" to decipher, but then also says very exactly that "hybrids are 3 to 4 times more expensive than LTCi." He simply dismisses them and does not explain how he came up with his 3 to 4 time more expensive figuring (i.e. whether he was able to decipher them himself! Likely not---he just dismissed them as "too difficult!)

He does not seem to take into account "any value" at all for feature that Hybrids, at death of insureds, pay about double (depending on ages when issued) the initial premium out to heirs as life insurance, if the LTC benefits were never needed or used. Author simply assigns "no" value at all to that feature!

And he assigns no value to feature that there are "never" any premium increases!

So, Hybrids overcome main objections many have to getting LTCi at all:
1) People fear "wasting" years worth of insurance premiums for something that they may never use. With Hybrids, if you don't use it (or use all of it), your heirs get about double your premium amount back as life insurance payout. (If you use some of the LTC feature, the heirs get the remainder back as life insurance.)
2) Potential buyers fear LTCi premium increases over the years, and some fear being priced out of holding onto their insurance. With Hybrids, this is simply never a concern at all. They are either paid for with upfront single premium, or some are paid over ten years with contractual yearly payment set in contract at issue date.
3) Other potential buyers wonder how to afford coverage for "both" spouses, needing two separate policies. With some available Hybrids, both spouses can be covered under one policy with the LTCi benefits being available to either or both spouses. So, one can make a judgement on "odds" of either or both needing LTC, and choose a size of Hybrid policy such as to play their judgement on those odds. Premium efficiency of covering both spouses under one policy.


So, Hybrids solve a lot of the main objections to LTCi many have, such as the self-insurers.

What people give up to an insurance company in purchase of a Hybrid, with an upfront single premium, is excess time value of investing that single premium amount over the years. But they "do not" give up the single premium itself. Indeed, their heirs may at least double that money, if LTCi never used.

So my opinion is people should not dismiss Hybrids out of hand, like this author did, as "too difficult to understand". People, especially self-insurers, with the objections stated above should look into and consider the Hybrids as via solutions solving many of the big objections---while "still" providing peace of mind.

(Full disclosure, I am a 20 years ago retired CPA. Haven't done CPA work for pay for all that time. But I do still have my wits about me! In my opinion!)
It seems like you are really quite excited about the hybrid
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Old 02-06-2021, 09:59 AM   #94
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At $120,000 per year, I figure we'd last about 20 years for one of us, or about 10 years for both. Inflation or investment growth not taken into consideration. Reality is a little more complicated. We have $500,000 set aside in stable assets specifically for LTC. Beyond that we'd have to start liquidating our other investments.
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Old 02-06-2021, 03:09 PM   #95
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As I've said on many threads, including my answer to this one, I'm not a LTCi fan. However, I agree that the author of the LTCi analysis (which is detailed and well laid out IMO) doesn't provide enough detail on how s/he reached the conclusion regarding hybrid policies. I'd like to know how s/he concluded that hybrid policies are 3-4 times as expensive as traditional LTCi policies (I suspect it's some sort of PV analysis but, who knows?). I'm also curious why they are more complex (Is it because it's a "hybrid" of two products or the contract language is less transparent; again, who knows?).
I believe the LTCi salesman over on bogleheads who says hybrids cost 3-4x as much as straight LTCi for the LTC benefits provided, since he presumably sells both types of products.

Here's a 2018 article from an independent broker as to why he chooses traditional LTCi over hybrid:

https://advisorinsuranceresource.com...g-Insurers.pdf

As Robbie notes hybrids are primarily for convenience...pay one lump sum or "10-pay" and then never pay again.

Another advantage is the option of an unlimited duration benefits, but that is a very expensive rider.

Please be careful you're buying a whole life, not universal policy...I had one agent try to sell me a hybrid but the underlying policy was universal life.

In my hard-won personal experience, those always need more cash down the road to keep the policy in force.

Hybrids are also apparently easier to medically qualify for versus standard LTCi which may be a concern if you're older and already have some pre-existing conditions.

Given the premium paid in the illustrations the life insurance benefit is not a great deal...best to view that as a "return of premium" rider...but only if LTC benefits are never used.
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Old 02-06-2021, 05:45 PM   #96
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Self insuring for LTC due to cost. Culturally we age in place or in children's homes.
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Old 02-06-2021, 08:59 PM   #97
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It seems like you are really quite excited about the hybrid
I think it solves some of the main objections people have to buying straight out LTCi. I know it solved a couple for me, so I do have a Hybrid myself and am happy with my decision, no regrets.

If worse comes to worse and I never need to use LTC, then my heirs get almost double my single premium back as life insurance. No regrets about "wasted" money. And I never face any premium increases as long as I live. No fears of being priced out of my policy. And I have peace of mind about not using up my estate to live in assisted living/nursing home, and then leaving my kids nothing.

Also, while DW was alive our policy covered either or both of us, so very efficient premium wise to protect us both. As it turns out DW never needed the LTC as she passed after a relatively brief illness.

But "excited"? We are talking potential diminished capacity and finally death here, so I am not sure "excited" is the right word!
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Old 02-06-2021, 09:15 PM   #98
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I believe the LTCi salesman over on bogleheads who says hybrids cost 3-4x as much as straight LTCi for the LTC benefits provided, since he presumably sells both types of products.

Keep seeing this claim hyrbrid premiums 3 to 4 times what straight LTCi costs.

But consider this, with hybrids, one (or one's heirs) are guaranteed to get some multiple of the single premium they pay back. Either as LTC benefits, or as life insurance, or some combinations thereof. Or one can even get their single premium refunded, if one really wants to do that.

Never any "wasted" premium dollars over the years.

How can anyone consider that 3 to 4 times more expensive than straight LTCi where year's worth of premiums "may" ultimately be wasted if the owners never need LTC? That situation does not always happen (or no one would ever buy LTCi), BUT it does often enough happen. It bothered me!

That to me is the crux of any comparisons.
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Old 02-07-2021, 01:58 AM   #99
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Self insuring for LTC due to cost. Culturally we age in place or in children's homes.
We were joking with our youngest daughter a few years back. We said we were going to move in with her and let her change our Depends. She said she'd buy us a trailer to put out in the desert. I know we were kidding. I hope she was.
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Old 02-07-2021, 06:19 AM   #100
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If worse comes to worse and I never need to use LTC
Is that the worst outcome? I agree that the hybrid overcomes some objections to LTC insurance. I am glad that it is working out for you. Others have indicated that they gave enough assets to cover ltc. Would you recommend a hybrid policy in those cases? I read the article that ncbill linked. The couple was young and the hybrid policy had no inflation protection. Ncbill mentions hybrids with universal life policies. I am not sure how that would work. I dodged the bullet on those policies 35 years ago but not because I foresaw the development of the universal life debacle.
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