LTC insurance rate increase normal?

[pirsquared]

We were just notified that our LTC insurance rates will increase by about 50%, but then they are guaranteed to stay the same for at least 5 years. I think our rates may still be a heck of a deal, though. Mine (age 50ish) is increasing from approx $100 per 3 months to approx $150 per 3 months and DH's (age 65ish) is increasing from approx $280 per 3 months to approx $420 for 3 months. Are these still decent rates? This is for up $200 coverage per day up to $400,000 total benefits I think. We also have the option of paying the same rates for reduced benefits or stop paying entirely (Nonforfeiture Coverage provision). My instinct is to pay the increased rates if this is still a decent deal. So I am wondering how these rates compare.

Thanks!

 

[REWahoo]

Here are our numbers for comparison. Policies were taken out at ages 51 and 50, we are now 75 and 74.

Facility Benefit Maximum: $265/day
Home Care Benefit Maximum: $1,858/week
Lifetime Benefit Maximum: $290,536 (each)
Elimination Period: 90 days

Annual Premium: $569 (each)

 

[pirsquared]

Thanks! This is helpful.

 

[RetiredHappy]

These are my current numbers - Bought in 2009. Current age: 59. I have not had a rate increase since purchase.

Inflation rider (benefits growth) each year: 3%
Home care/facility care (same $ amount): $8555.00 per month
Lifetime maximum limit: $513,274
Elimination periold: 90 days

Monthly premium: $97.21

 

[Montecfo]

Steep increases seem to become the norm every 5 years (recollection from reviewing DMIL's policy and payment history).

It seems like a bad plan to cut your benefits though. Seems like that is what the insurance company wants you to do.

You are always paying to see the next "card". Like blackjack.

 

[pirsquared]

Thanks, everyone, for the input. It is very helpful.

 

[klec]

I spent some time in the LTC business (a brokerage). Companies are experiencing that buyers of LTC insurance are planners and serious about protecting the wealth they’ve built AND taking any burden off of family members. For that reason they tend to keep their policies in place. I’ve been through the process with family and LTC insurance was a blessing. I’ve had my policy for 12 years with one rate increase. I look at it this way … my annual premium is way less than what a single month of care would cost me if I were paying out of pocket. A lot of people think that Medicare will jump in and participate in the cost of LTC. Unfortunately, that’s not what happens. With the cost of care around $7000+ a month, LTC coverage is just smart.

 

[pirsquared]

I spent some time in the LTC business (a brokerage). Companies are experiencing that buyers of LTC insurance are planners and serious about protecting the wealth they’ve built AND taking any burden off of family members. For that reason they tend to keep their policies in place. I’ve been through the process with family and LTC insurance was a blessing. I’ve had my policy for 12 years with one rate increase. I look at it this way … my annual premium is way less than what a single month of care would cost me if I were paying out of pocket. A lot of people think that Medicare will jump in and participate in the cost of LTC. Unfortunately, that’s not what happens. With the cost of care around $7000+ a month, LTC coverage is just smart.

Thanks for the reply! I called the LTC insurance company and asked several questions to make sure we had all the details and options straight. Then DH and I discussed it and decided to keep our policies in place at the current benefit levels (and thus increased rate).

 

[G-Man]

What LTC insurance companies do you have a policy with? I have not considered LTC insurance until I saw this thread.

 

[klec]

There used to be more than 100 companies in the LTC market. Many of them had terrible policies, others were sketchy when it came time to pay claims. There are only a handful available now … and that’s a good thing. personally, I have UNUM, but Genworth also offers a solid policy. ALSO, there are various annuity and Life products that can include LTC riders. You should research that, for sure.

 

[MrsHaloFIRE]

We have LTC feds available to federal/military. ID we could swap it would check out a LTC/life ins hybrid policy. Not say in we would switch but would consider

 

[mf15]

The saving grace with our Genworth policy is if one dies,premiums are waved
for the other spouse. Otherwise not real thrilled with the yearly rate increase or
reduction,in benefits.
Oldmike

 

[G-Man]

Best LTC. Anyone have a policy with these companies?

https://www.investopedia.com/best-long-term-care-insurance-5070718

 

[Deej]

We bought our policies 12 years ago at ages 52/50, now 62/64. At that time, the lifetime max was $300K each (shared) and premium was $2,928/yr for both policies together. Currently, premium is $5,945/yr. Our benefits have increased considerably though with the going rates of care. Policies are CPI-U compound inflation w/ guaranteed increase. 90 day elim.

Currently:
Lifetime max $497K+
Nursing home/assist lvg/home care $8,286/month
I pay $2,875/yr or $239.58/mo.; DH pays $3,070/yr or $256/mo
For both: $5,945/yr/$495/mo

We intend to keep our policies. Are we throwing money away? Maybe, time will tell. We have no kids to leave our money to or to take care of us (not that anyone should rely on kids to do this job), so this should give us good coverage and (hopefully) money well spend whether we need it or not...piece of mind. If something were to happen to one of us today where an assisted living/nursing home was needed, it would surely eat up a good portion of our savings, so...

I'm currently caring for my mother and wish she had bought LTCI back in the day.

Your increase seems reasonable; I'd surely keep it.

 

[G-Man]

Has anyone used this site to find a LTC agent?

https://www.aaltci.org/consumer/agents.html

 

[G-Man]

Found this post as well..

https://www.early-retirement.org/forums/f28/ltc-policy-for-retirees-94334-7.html#post2135420

 

[pirsquared]

The saving grace with our Genworth policy is if one dies,premiums are waved
for the other spouse. Otherwise not real thrilled with the yearly rate increase or
reduction,in benefits.
Oldmike

Do all Genworth policies have this benefit? DH is quite a bit older than I am so this would be more reason to keep paying in for both of us.

 

[G-Man]

I'm getting some quotes for LTCI. I'm curious to know what others are paying and the terms of the LTCI policy.

Maximum Monthly Benefit
Policy Limit
Elimination Period
Monthly Premium
Inflation Protection Benefit: x% Compound (Lifetime)

 

[klec]

Even so, I’d compare Genworth. The reason … they began as AMEX Life, an American Express company. They have a longer history in the LTC business than the other companies, and have paid way more claims over the years. Back in the early days of LTC insurance, Consumer Reports ran a cover story article about LTC companies. After doing their due diligence, they selected an Atlanta based company called ‘Atlantic & Pacific’ as their top pick. The company was issued a cease and desist as the article was in print. Checking with your states DOI Commissioner’s Office can be very helpful.

 

[G-Man]

I will get a quote from Genworth.