Should I Get Long-Term Care Insurance?

How to finance long-term care is an important question that you must address, as the likelihood of needing long-term care continues to increase and the costs of long-term care continue to rise. As long-term care insurance premiums have drastically increased, some policyholders have cancelled their policies. This has caused many individuals to be unable to afford long-term care and a complete loss of the premiums that they had previously paid for coverage. The alternative is to continue to pay for increasingly higher premiums for reduced benefits, which may be not only unaffordable, but also insufficient to cover the full costs of long-term care.

If a comprehensive long-term care insurance policy is unaffordable or otherwise not cost-effective, however, there are options that may be available to you, depending on your circumstances. For instance, some individuals may qualify for Medicaid coverage, if eligibility requirements are met. Proper Medicaid planning can make all the difference in qualifying individuals for Medicaid.

Alternatively, deferred annuities may be another way to finance long-term care. You can fund an annuity with payments over time or a lump-sum payment. The investment grows tax-deferred, and income at least in the amount of your initial investment is guaranteed. Annuities can be attractive for those who self-insure for long-term care needs, cannot afford premiums for long-term care insurance, or an inability to get insurance coverage due to pre-existing medical conditions. On the other hand, a relatively large initial investment is required for a deferred annuity, and this investment may be unavailable for a significant period of time due to the high penalties for early withdrawal.

Planning for your family’s future is a complex process that can involve many different options, including the purchase of long-term care insurance. By answering some of your questions and addressing your concerns, it is our hope that we can help you create the estate plan that is best for you and your family. At Legacy Law Center, we are here to advocate on behalf of all individuals and their families who need help planning for the future. Contact us today at (734) 995-2383, set up an appointment with one of our Michigan estate planning attorneys, and discover how we can help you and your family.