How To Handle An Increase In Your Long-Term-Care Premiums

The cost of living rises every year, which makes paying for basic expenses more difficult. Long-term-care (LTC) premiums are increasing, too. The increase in premiums can harm an individual’s quality of life and continued access to quality care.

According to the U.S. Department of Health and Human Services, someone turning 65 today has nearly a 70% chance of needing long-term-care services and support. Currently, a growing client base who bought LTC insurance is the past is now seeing high premium increases.1

While someone in their 60s and early-to-mid-70s may be able to manage a premium increase, the rate hike is much more difficult for those in their late 70s. The situation may have you thinking you need to reduce coverage or even forgo insurance altogether.

However, there are less drastic ways to tackle the issue and maintain premiums while handling the increased costs.

Five ways to help handle LTC premium increases

As a policyholder faced with an increase in LTC premiums, you will need to find ways to cushion the blow and help maintain the policy while dealing with higher costs.

Here are ways you can circumvent the higher costs:

  • Shorten your benefit period. Carriers typically offer different benefit periods that can range from two to five years. Shorter benefit periods mean the insurance company will have to pay out fewer claims, and that can lower your premiums.
  • Consider a shared care policy. Shared care is a type of long-term-care insurance coverage for married couples. It lets spouses take out a plan and add their partners as a “rider.” As a designated rider, you can access the funds of your spouse’s plan if you exhaust funds from your own policy. A shared care policy can reduce costs by pooling benefits together. Then, when either of you need coverage, you can split the coverage between the two of you.
  • Think about a longer delay period. The longer you make the waiting period before you start receiving payments, the cheaper your premiums can be. It’s like a deductible on car or home insurance, except it’s measured in time and not a dollar amount.
  • Reduce your daily benefits (if you must). When buying your policy, you were likely looking for the best protection available. You may want to consider reducing the daily benefit as a last resort now that premium costs are rising.
  • Contact your provider to ask about options. Every carrier offers different policy terms, and you may have other options to make your coverage more affordable. It also helps to talk with a financial professional – as they can review your situation, discuss your coverage needs, and recommend an affordable option.

The rising LTC rates may be a shock, but remember you’re not alone. The most important thing to keep in mind is that you have options. It may be possible to lower your monthly premiums and maintain your coverage, so you have the help when you need it the most.

  1. https://acl.gov/ltc/basic-needs/how-much-care-will-you-need

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