There’s a good chance you’ll need long-term care as you age. But if you’re like many Americans, you likely don’t have a plan to pay for this sort of care.
Although about half of adults turning 65 today will develop a disability that is serious enough to require assistance with daily activities of living, only 11% have long-term care insurance coverage that will help pay for the cost of care, according to the Urban Institute. Often, people don’t recognize the need for this sort of coverage because they underestimate the cost of care. And they mistakenly assume that Medicare and health insurance will cover long-term care.
Plus, the cost of long-term care insurance can be a deterrent to getting coverage. “Traditional plans have a bad rap because there have been so many hikes in premiums,” says Matthew Sweeney, life and long-term care specialist with Coverage Inc. in Virginia. “When people hear ‘long-term care insurance,’ they say, ‘I’m not interested.’”
The idea of paying hefty premiums for coverage they might not need leaves a bad taste in people’s mouths. But there is an alternative to use-it-or-lose-it traditional long-term care insurance. Hybrid life insurance products provide long-term care coverage if there is a need, or a death benefit if the policy isn’t used to pay for care.
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