How To Avoid Long Term Care Insurance Premium Hikes
Even though long term care insurance is an important investment which everybody should be considering, many people still refuse to put their money on this product as they fear being subjected to very high long term care insurance premiums.
Reports about the plan of long term care insurance (LTCI) firms to increase the premium rates of their existing policies from 10% to 15% further discourage the uninsured folks. According to them, a 5% inflation rate is too much to handle already so what more a higher increment in LTCI premiums?
Meanwhile, many policyholders have admitted that when the premiums of their coverage increased by 40% they found themselves on the verge of dropping their policies. However, the thought of their children suffering while and after providing them LTC pierced their hearts so they decided to continue with it.
It’s a good thing that these responsible individuals held on to their policies because had they given up on their coverage, they will be counted among the large nursing home residents who lost their homes after they chose not to plan their LTC and simply depend on Medicaid.
Anyone who decides to purchase an LTCI policy should be willing to adjust some areas of his life so that he won’t have any problem maintaining his annual premium. For instance, if he has the habit of picking up coffee on the way to office perhaps it’s about time that he starts brewing his own at home. Meals to go should be a thing of the past and he should make use of his spacious kitchen by preparing home-cooked meals.
Curbing Long Term Care Insurance Premiums
Aside from lifestyle modification, another way to save on your LTCI premium is to buy your policy before you reach the retirement age. While there are some people who reach 65 healthy, majority of them begin to manifest unpleasant changes in their health around this age and to most insurance companies this leaves a bad taste in the mouth.
Underwriters of LTCI firms prefer young and healthy applicants and this explains why people who fit this description never fail to walk away with huge preferred health discounts.
Aside from the preferred health discount, buying your policy while you’re young and not shouldering heavy financial responsibilities makes you capable of the one-time premium payment. This means you will give a lump sum for your coverage and thus you spare yourself from premium hikes which may possibly occur in the future.
It’s natural for anyone to think that the one-time payment mode is too heavy especially for someone who is married, paying the mortgage, and putting his children through school. But if you’re single and your take-home pay allows you to vacation wherever you want every six months, then a one-time premium payment shouldn’t be an issue,
Now if you’re working on a budget see to it that you choose your maximum benefit amount, benefit period, elimination period, and rate of inflation protection intelligently as these factors will affect the annual premium of your coverage.
For more ways on how to curb long term care insurance premiums, contact your LTCI broker and take his advice.
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