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Author: yodaorange Big red star, 1000 posts Feste Award Nominee! Feste Award Winner! Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 457612  
Subject: Long Term Care Insurance: Buy ASAP . . . Date: 12/15/2012 2:33 PM
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. . . IF you were planning to buy soon. Historically Long Term Care Insurance (LTCI) has been priced on a gender neutral basis. Men and women pay the same rates. This is despite the fact that women statistically live longer than men. It is not clear why the insurance industry originally set the pricing as gender neutral.

That is about to change. One of the largest LTCI underwriters, Genworth, recently announced plans to separate the rates for men and women, effective Q2 2013.[1] This means that women’s rates will increase by ~ 30% to 40%. They did not comment on men’s rates, but my guess is that they will NOT go down.

In any event, IF you are a female and had planned on buying LTCI, you might consider doing it ASAP. Several of the underwriters have stopped writing new LTCI policies in the last few years. They underpriced the coverage and lost a lot of money. The remaining carriers have been raising rates in an attempt to catch up.

It is beyond the scope of this post to lay out the detailed arguments for and against LTCI. Suffice to say that most of us will become disabled before we decease. The disability might require a stay in a nursing home. Recall that Medicare will NOT pay for extended long term care. Medicaid will pay for it, but you essentially have to be broke. If you have any financial assets, you must spend them down to ~$2,500 before Medicaid will start paying. The exact dollar amount varies by state.

THIS IS NOT A RECOMMENDATION THAT YOU SHOULD OR SHOULD NOT HAVE LTCI. YOU WILL HAVE TO MAKE THAT DETERMINATION ON YOUR OWN.

Thanks,

Yodaorange


[1] Article on Genworth raising Long Term Care Insurance Rates for women
http://insurancenewsnet.com/article.aspx?id=366544&type=...
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