How to Minimize Your Long-Term Care Premium

Long-term care premiums are the recurring amount you pay to receive benefits for your long-term insurance program. Long-term care (LTC) is an insurance that provides you with medical and nursing assistance as a senior citizen. According to research, nearly 60 percent of senior citizens will need LTC for an average period of three to four years. With the rising cost of nursing homes and health care, it is advisable to buy long-term care insurance especially if you have a family history of prolonged illnesses. Minimizing the premium on your LTC will require that you put thought into your package while keeping in mind your family’s health history to make the best decisions suited to your individual case.

Buy on Time

Most people put off purchasing long-term care insurance until they are well into their sixties. That raises the premium considerably, whereas if you buy the insurance earlier, the premiums will be lower and the likelihood of rejection from the insurance company vastly reduced. The best time to buy your long-term care insurance is in your middle age. This is the time when the premium costs will be the lowest.

Choosing Coverage Wisely

You should shop around with various companies for the best coverage plan. One type of coverage to consider involves an inflation benefit for long-term care benefits. If you buy earlier in life, than this is suitable, as the cost of living is likely to rise with time and your insurance will cover any inflation irregularities. The benefit period is the time of coverage you are looking for. The premium will be lower for a shorter coverage period. For example, a 4-year coverage period will cost half that of a long-term coverage period. For this, you need to look into your family’s medical history, but on the average, a person requires 3 to 4 years of coverage.  

Benefits Policy

It’s wise to go for a policy that gives you more money in a shorter period of time than a policy that will cover a longer period but pay less. The idea behind this is that if you need expensive treatment, you can use up the bulk of it and the remaining can be extended even after your coverage or for as long as it lasts.

Elimination Period

This is the number of days you want to wait before the insurance company starts to pay. The average range is from zero to 180 days. The longer the elimination period, the less the premium. Therefore, if you have substantial assets to cover expenses for a short while before you want the insurance company to kick in, this will mean you can pay a lower premium. Some companies provide options for the waiting period. You can opt for a longer waiting period for out-of-home care and for no waiting for care at home, which is where most care begins.

Shared Benefit Policy

If you are married, it’s a good idea to go for a shared benefit policy. This way both of you can purchase a 3-year package, and in case one of you needs care for longer than 3 years, time can be taken from the other spouse's insurance package without having to pay for a longer term package.

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