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Old 02-09-2021, 02:06 PM   #121
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Are there any people posting on this thread who have had great experiences with LTC claims?
My mother had a policy back in the 1990s. When she went into the care facility, it was relatively straight forward to make a claim and be paid. I have told the story before that my mother came out "even" money wise when she passed. That included my selling her house to cover care costs. Her LTC policy had exhausted (it was set up for only 2 years of pay out). But without that policy, she would have needed to apply for Medicaid which might have been a nightmare. My mother had donated to every charity who ever asked (this fund, that fund, on and on.) I'm guessing the look-back would have made Medicaid at best a long hassle and at worst, a non-starter.

No, I don't recall the name of the company that supplied the insurance but I do recall the name of the nice lady there who was their contact. I suppose most policies have this - a rider to stop the premiums once a claim is made. That was handy though I'm sure the cost was "in there" someplace. YMMV
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Old 02-10-2021, 09:33 PM   #122
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I'm also interested in seeing responses to this, and not only from those who have had great experiences, how about so-so experiences? It seems we've only heard negative stories, leaving the impression that's always the case. Is it?
I am not sure this qualifies as "great" but as I mentioned briefly earlier in this thread, my mother had an LTC policy. The insurer initially denied her claim, but then reversed itself when I appealed. After that, they paid on time, without any real difficulties, every month. The total paid was something like $200,000, or thereabout. That was much more than she paid in premiums. So it worked out well for her. (Of course, if she had not had someone with the requisite knowledge to successfully prosecute the appeal, the result might have been very different...)
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Old 02-10-2021, 09:52 PM   #123
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No direct experience with claims, yet.

But another possible advantage of Hybrid LTC/Life policies over straight LTCi, is the Hybrid insurer would have no big motive to deny LTC claims. Life coverage payable amount with Hybrids is reduced by any amounts paid under LTC coverage. Insurer has to pay one way or the other. It either pays full death benefit, if LTC claims never made--or never paid, or it goes ahead and pays the LTC claim, and thereby has a lesser or no amount of death benefit to pay.

Under straight LTCi, if insurer never pays the LTC claims, then, it pays nothing.
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Old 02-10-2021, 09:56 PM   #124
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Old 02-10-2021, 10:07 PM   #125
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Ah, the sound of a one-note piano, played over and over again...
The sound of a very helpful piano teacher.
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Old 02-11-2021, 12:09 PM   #126
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One can need care w/o hitting the triggers for payment. My mother wanted home health care included but I don't think she realized that the triggers for payments (2 adl ) were the same.
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Old 02-11-2021, 12:28 PM   #127
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Another thought occurred to me about long-term care insurance. And the argument about paying years and years of premiums for something you may never use (such as one does with straight LTCi). And maybe one should "self-insure" therefor for long-term care.

I could apply that same thinking to home fire insurance! And I think it "probably" more likely I would have a claim on LTCi than I ever would for my house burning down. So maybe I should self insure my home and cancel my fire insurance!
I could easily self-insure my home for fire or storm damage. The reason I carry home owner's insurance is for liability protection. It's the foundation for my umbrella policy.
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Old 02-11-2021, 12:40 PM   #128
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I think I understand how LI, LTCi and annuities are profitable to the issuers. But I'm having a bit of trouble understanding exactly where profits for the issuer comes from with these hybrid policies. We know that the company must generate more input from premiums and earnings than they spend on LTC costs and death benefits. No doubt about it. Yet much of the pro hybrid policy chat seems to imply that the policy beneficiary either uses the premium when it covers LTC costs or generous multiples of it are given to heirs at the owner's death.

Where does the profit flow to the issuer come from? It has to be there.
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Old 02-11-2021, 01:14 PM   #129
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I could easily self-insure my home for fire or storm damage. The reason I carry home owner's insurance is for liability protection. It's the foundation for my umbrella policy.
Plus if your homeowners or auto policy goes up 100% (which happened to my mother's LTC policy) you can usually find another insurer at a cheaper rate--not so with a LTC policy. If you are age 80 and your LTC policy goes up 100% you cannot find another policy, there is no way to shop around, you are stuck.
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Old 02-11-2021, 01:35 PM   #130
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I think I understand how LI, LTCi and annuities are profitable to the issuers. But I'm having a bit of trouble understanding exactly where profits for the issuer comes from with these hybrid policies. ..........

Where does the profit flow to the issuer come from? It has to be there.
I believe they get it from the time value of the single upfront premium.

Rather than premiums dribbling in each year, they get one big lump upfront right at policy issue (or in some case on a ten year pay plan). Insurer then gets to invest that one big lump for many years before any payouts ensue. Enough time value of compounding there to give them a profit as well as fund the insured's benefits.

I make no bones about it, that if I retained that single premium (i.e.--"self-insure") for my life expectancy at the time I buy a hybrid, I could "probably" end up with a multiple of my original amount greater than the hybrid payout amount as either life insurance or as LTC benefit. That is, "probably", if I were of sound mind and body and able to manage my investment all that time--which kind of contradicts the whole idea of LTC in the first place. "Probably", as in, the markets would not suffer a big dip right before my time of need to draw funds. "Probably", as in I would be a better investor than the insurance company.

I lay off the risks of those uncertainties to the insurance company for a few certainties in my life---(1) I know my heirs will get a multiple of my lump sum at the end if I never use the LTC feature--i.e., I will not have "wasted" my money; (2) If I do need the LTC feature, then I do have what I consider (after looking at statistics) adequate coverage for an adequate length of time; (3) I know I will never face any unexpected LTCi premium increases over the rest of my life, such as might cause me to dump the policy entirely, or accept lower benefits; (4) I know I don't have to worry about market ups and downs in managing that particular lump, especially when I am old and decrepit and in need of long term care and unable to manage finances with great acumen.

For taking on those risks for me, the insurance company gets most of the time value of investing that lump sum for a decade or two (or three).
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Old 02-11-2021, 03:30 PM   #131
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My mother died last week after basically four months in and out of hospital and care home with a period at Home with a live in nurse. Dealing with Medicare for hospitalization and drugs was a breeze. Dealing with LTC has been like dropping twigs in a river - perfectly lovely people but no action. Finally Iíve got them to agree that since sheís dead thereís no point in going after continued premiums, but to date they still havenít decided if thereís a valid claim or what days would count towards the deductible even if there were. Iím sure there are some circumstances under which they would have paid something but the experience certainly made up my mind to self insure. In any event the maximum benefit was a lifetime $400k which doesnít even seem like that much of an insurance amount to me given the premiums over the years.
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Old 02-11-2021, 03:45 PM   #132
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My mother died last week after basically four months in and out of hospital and care home with a period at Home with a live in nurse. Dealing with Medicare for hospitalization and drugs was a breeze. Dealing with LTC has been like dropping twigs in a river - perfectly lovely people but no action. Finally Iíve got them to agree that since sheís dead thereís no point in going after continued premiums, but to date they still havenít decided if thereís a valid claim or what days would count towards the deductible even if there were. Iím sure there are some circumstances under which they would have paid something but the experience certainly made up my mind to self insure. In any event the maximum benefit was a lifetime $400k which doesnít even seem like that much of an insurance amount to me given the premiums over the years.
Dd852, I am so sorry about your mom and now you are having to deal with a LTC company that seems to be stonewalling you. And you even had a hard time getting them to stop taking the premiums after her death? What a racket. I am afraid the same thing is going to happen eventually with my mom's LTC policy. She has paid premiums for 35 years on the policy and may never get any benefit from it. Even if my mom where to somehow get the maximum amount under her policy she will never get her money's worth. In my opinion in most cases LTCI just is not a good deal financially. It seems sort of like dental insurance-- the maximum amount you can receive under the policy is not enough to justify the premiums paid in.
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Old 02-11-2021, 04:48 PM   #133
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Almost forgot that I have a hybrid LTC policy. I also have LTC insurance. The hybrid is something I bought through w*rk (more or less endorsed by Megacorp for what ever reason and offered with "group rates.") Anyway, I'd almost forgotten it as I received NO communications from the insurer once it was paid off. In fact, I had to call Megacorp Retiree help line to even find out the insurer's name (several years ago and I've already forgotten - think it morphed into AIG but not sure.)

So back in early 90's when I took out the policy, at least the numbers sounded pretty good. $50K life insurance WITH the ability to use the money for LTC. I thought I was set until my mom went into the nursing home and I realized $50K would not last me very long (especially now - it was bad enough when mom was in a home.) SO, I was young (well 45 or so) when I took out the policy and I can't say I recommend hybrid, but I paid for it and I have it, so who knows. It might handle as much as 5 months for one of us if we need LTC. Now, I should call Megacorp Retiree help line again to find out who my policy is with and what is its "status." YMMV
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Old 02-11-2021, 04:55 PM   #134
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Dd852, I am very sorry for your loss. The circumstances of your mom's last four months in and out of hospital and home care will definitely complicate claiming benefits under a LTCi plan. I hope you are able to resolve everything to your satisfaction.

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I am afraid the same thing is going to happen eventually with my mom's LTC policy. She has paid premiums for 35 years on the policy and may never get any benefit from it. Even if my mom where to somehow get the maximum amount under her policy she will never get her money's worth. In my opinion in most cases LTCI just is not a good deal financially. It seems sort of like dental insurance-- the maximum amount you can receive under the policy is not enough to justify the premiums paid in.
harlee, you've described your mom's LTCi concerns on a number of occasions and I sincerely hope she never gets any benefit from it due to never needing care and living independently, in full command of her mental facilities until the very end.

I think it is important to point out each of us is different, LTCi policies and premiums vary, and the unfortunate cost/benefit ratio of your mom's LTCi isn't necessarily representative of everyone's situation.

21 years ago (in our early 50's), DW and I chose to purchase LTCi policies as both her parents and mine spent their final days in a nursing home: 3+ years for her mom, 2+ years for my mom, and 7 to 9 months for each of our dads. DW and I have three year policies valued at $290,000 in benefits ($265/day) for each of us. After 21 years we've each paid $15,000 in premiums and, at least at this point, think the cost of coverage to be reasonable.

My point is each of us is different, LTCi policies and premiums vary, and the unfortunate cost/benefit ratio of your mom's LTCi isn't necessarily representative of everyone's situation. Our premiums have increased and we did drop the annual 5% increase in benefits last year to reduce premium costs. Should future premiums increase to the point we no longer feel the potential benefit is worth the cost we will cancel the coverage as we are now at a point we can self-insure. This is similar to what I did with my term life insurance, canceling it as premiums increased and our portfolio grew to the point it will now support DW in the manner to which she has become accustomed.
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Old 02-11-2021, 05:11 PM   #135
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REWahoo, good analogy to term life insurance. When mother took out the policy over 30 years ago it was very reasonable and for many years no premium increase. When the policy premium doubled in one year DM should have just dropped the policy since she had sufficient assets to self fund. I am very lucky to have a 90 year old mom who is still independent and so far has had no need for her LTCI. My husband and I have decided to go the CCRC route rather than the LTCI.
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Old 02-11-2021, 05:22 PM   #136
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21 years ago (in our early 50's), DW and I chose to purchase LTCi policies as both her parents and mine spent their final days in a nursing home: 3+ years for her mom, 2+ years for my mom, and 7 to 9 months for each of our dads. DW and I have three year policies valued at $290,000 in benefits ($265/day) for each of us. After 21 years we've each paid $15,000 in premiums and, at least at this point, think the cost of coverage to be reasonable.

My point is each of us is different, LTCi policies and premiums vary, and the unfortunate cost/benefit ratio of your mom's LTCi isn't necessarily representative of everyone's situation. Our premiums have increased and we did drop the annual 5% increase in benefits last year to reduce premium costs. Should future premiums increase to the point we no longer feel the potential benefit is worth the cost we will cancel the coverage as we are now at a point we can self-insure. This is similar to what I did with my term life insurance, canceling it as premiums increased and our portfolio grew to the point it will now support DW in the manner to which she has become accustomed.
REW-

Looks like you got a relatively good deal. If my math is correct, your $15k in premiums would have a current NPV of ~$25k @ 5% return. So, you two have a potential payout of $580k for what will almost certainly be well below $100k NPV of premiums paid (assuming the worst case of dramatic premium increases in the next decade) by the time the average person would need LTC.

The analogy to term life insurance is interesting. I've not seen that line of reasoning before. Did you think of LTCi that way when you bought it or, is it a happy circumstance of the recent bull market?
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Old 02-11-2021, 05:34 PM   #137
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The analogy to term life insurance is interesting. I've not seen that line of reasoning before. Did you think of LTCi that way when you bought it or, is it a happy circumstance of the recent bull market?
I've always viewed it that way. Here are a couple of threads from many years ago:

https://www.early-retirement.org/for...tml#post558485
https://www.early-retirement.org/for...ml#post1128421
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Old 02-11-2021, 06:36 PM   #138
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21 years ago (in our early 50's), DW and I chose to purchase LTCi policies as both her parents and mine spent their final days in a nursing home: 3+ years for her mom, 2+ years for my mom, and 7 to 9 months for each of our dads. DW and I have three year policies valued at $290,000 in benefits ($265/day) for each of us. After 21 years we've each paid $15,000 in premiums and, at least at this point, think the cost of coverage to be reasonable............

Our premiums have increased and we did drop the annual 5% increase in benefits last year to reduce premium costs.....
You seem like you are in a fairly good position on your LTCi policies as far as premiums paid are concerned (excepting having to drop the inflation coverage) for the benefit amounts you have.

You made a fortuitous decision those 21 years ago at relatively young age to get your LTCi policies in force at such affordable rates.

Those of us who were older, such as myself, when we got around to thinking about such things as elder care and assisted living facilities and the tremendous costs thereof, faced a different landscape of options when finally making our decisions.

More power to you for being so forward thinking back then.

May I ask what LTCi insurer are you with?
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Old 02-11-2021, 06:41 PM   #139
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....... My husband and I have decided to go the CCRC route rather than the LTCI.
Can you share some more information about what is involved with CCRC's financially? And what parameters determine when one "moves into" a CCRC?

Just curious, this is an area totally off my radar, and my ignorance on CCRC's is huge.
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Old 02-11-2021, 06:47 PM   #140
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Not doing LTCI. Pops had LTCI and I could never navigate the hoops they gave me to run through. They paid nothing and cancelled the claim.

Pops died soon after. In the nursing home which I was trying to claim on.

My experience tells me that they will do everything in their power to avoid paying a dime. It's not like auto insurance. It's mystical with terms that I had no way of interpreting.
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