Most people balk at purchasing a long term care insurance policy because of the expense and complexity of the product. Even seasoned researchers can sometimes struggle to grasp all the ins-and-outs of these products.
One of the strengths of our agency is that we both sell and help family file claims on their long term care insurance policy. The claim filing experience has certainly helped us be able to steer purchasers towards the carrier contracts that are more likely to be functional in a wide variety of claim situations down the years. We keep an eye on the field as it changes frequently. So, if you are shopping for this product, here are our current “tips”:
- Get a financially sound company. ALWAYS ask what the financial ratings are. While not a perfect measure of financial stability – it is about the only one we have and it is better to know than buy blindly.
- Get a long term care insurance company with reasonable rate stability – in the past few years we have seen rate increases to policy holders anywhere from 10% up to 60%! So when you buy, you need to buy a company that has a pretty good record of trying to keep rates stable. Rate increases are generally regulated – so any rate increase will have seen government scrutiny. What you are really looking for are companies that are pricing SMART at the time of purchase so they aren’t having to go back and get rate raises again and again. Be aware that “smart” won’t always be “cheap” – if you find a long term care insurance company that is stupid cheap, you can bet you will see more rate increases the longer you own it.
- Get a long term care insurance company with low complaint index. Check with your state insurance commissioner. They should be able to tell you the complaint measure for that carrier on that product line. Often these are posted on the web – but if not posted, call and get someone to answer your questions. Carriers with high numbers of complaints have either had many rate upticks and/or are very difficult to get a claim filed.
- Understand your benefits. Ask the agent to explain again and AGAIN if you don’t understand what are your basic benefits and/or bells and whistles. Don’t overbuy. Most people buy partial coverage just to take the sting out of the cost of care and most people don’t need lots of bells and whistles. Be sure you are getting what YOU want and not what the agent thinks you should buy.
- Lastly – shop. You should be working with a seasoned long term care insurance broker who specializes in this complex product. Ask the agent how many they sell a year – remember the territory changes frequently. You want someone who does this often enough they are fully aware of all the long term care insurance carriers’ changing contracts.
If you have no idea where to start, download our free buyers worksheet from our website (www.MrsLTC.com) or call us and we can help you find a broker licensed in your state who we know will be knowledgeable and helpful to you.
FAQ’s for Buying Long Term Care Insurance
Worksheet for Buying Long Term Care Insurance