Think about purchasing a policy before you or your parent reaches the age of 65. Today’s healthy 50-year-old pays a yearly rate of about $1,500 for LTC coverage, while a healthy 65-year-old might pay $2,000 to $3,500. This increases in proportion to a decline in health. Overall rates are expected to increase dramatically in the next few years.

Read the fine print! Ask an Elder Law Attorney to check policies before you sign them. Ask whether the premium can be modified in the future (e.g., whether additional coverage may be added, how coverage is adjusted with changes in health, and whether it would remain consistent if an emergency evacuation required a move), and at what price.

Make sure the policy clearly states what is covered. Some policies cover nursing home care, but not assisted living; others are more inclusive. Choosing a limited type of coverage is often less expensive, but a gamble since need is hard to predict.

Check whether the policy includes a waiting period during which you must pay all of your expenses out-of-pocket before your LTC coverage kicks in-a kind of LTC insurance deductible. The downside is that expenses during this period (called an elimination period) may be very costly and drain what resources you have. The upside is that some companies lower their premiums in proportion to the length of the waiting period, which can be up to 100 days.

Look at what qualifications the policy requires for benefits to kick in. Does it require a hospital stay? What about pre-existing conditions? Does coverage change if dementia is thrown into the mix?

Perform a background check on the financial health of your provider. Companies such as A.M. Best and Moody’s do annual evaluations on all insurance companies, reporting such events as complaints filed for non-payment. Avoid providers with reputations for dropping clients when health status changes.

Finally, for all of these long term care insurance options, remember the bottom line: Will your plan provide complete coverage, overall savings, and real value, or merely cut down on year-over-year cost?

Related posts:

1. Percentage of Premium for a sample car insurance policy for a sample driver:
2. 10+ Tips to Help You Save on Car Insurance