Whether you should purchase long-term care insurance or not is a very personal decision. Traditionally, countless people have chosen not to purchase it, this is due to the lack of product awareness as well as costs. That being said, although there are risks associated with long-term care insurance, there are also benefits which over the last few years have been brought to light. Here are the risks and benefits associated with long-term care insurance:
Risk: At the Moment That is no Certainty in Pricing
Due to the fact that long-term care insurance is relatively new, you could say that it is still in its developmental stages and pricing has been one of the main concerns. The premiums which are currently being offered may change over time and the debate on how to properly price the various plans is an endless one. Experts say that it can be a big risk, there is no certainty of whether or not the premiums will be raised in the future, and there is also uncertainty as to whether the insurance is being priced accurately.
Benefit: Peace of Mind is Provided With Long-Term Care
Especially if you have a tendency to worry, you can ease your nerves with long-term care insurance. Once you have taken a plan out, you are able to rest assured knowing that you will have funds set aside to support you as well as your health as you get older.
Risk: It Is Not easy To Figure Out How Much Insurance You May Require
Being as it can be quite difficult to accurately pinpoint the extent of the benefits you may require later on in life, it can be a risky endeavor to take out a long-term care insurance. For example, there is no guarantee that a plan which guarantees $200,000 will actually be enough. The opposite is also a true, if more benefits are purchased; there is a chance that you will not use all of them. If you don’t use them all then at the moment you will have wasted let’s say $400,000.
Benefit: If You are Sure You Will Use It, It Can Be Worthwhile
Predicting the future is of course impossible, however it is crucial that you evaluate whether or not you will need long-term care, this will help you when deciding whether or not insurance is right for you. If you were 100% certain that you would go to a nursing home, then this option makes sense. Experts recommend that you look into your family history in order to decide whether you may need long-term care when you’re older.
Risk: Benefits May Not Be Distributed As They Are Needed
As is true with any insurance, long-term care insurance does have an elimination period, basically a set amount of time between a health episode or injury and the receipt of benefit payments. So let’s say you go to a nursing home for three months, you could potentially, depending on your plan, remain there for your entire time and never receive benefits.
These are the main risks and benefits associated with long-term health care insurance. It is important that you weigh these out carefully and make the decision that will best benefit your personal situation.