Long Term Care Insurance, What Am I Protecting?

Posted by Nick Niesen on October 29th, 2010

What does long term care insurance protect? In some instances this is an obvious answer. Let's keep the burden of care giving away from our kids; they have their own lives to live. The other obvious answer is protecting ones assets. The longer we live the greater the chances of having a long term care event in our lives. Let's take a look at both areas.

Having come from a family where my mother was the primary care giver for my grandmother after her onset of Alzheimer's disease, I can truly concur with many people who absolutely do not want to, and will not put their own children in peril of being a caregiver.

I actually saw my own mother age probably 10 years, over an actual 2 year period of care giving, before my grandmother was admitted to a 24-hour skilled care facility. This definitely made its mark on me, something one will never forget I assure you.

Other than the transfer of burden of away from your own children, there is one other item that sticks in my mind. That is the choice involved with your own care or your spouse?s care.

Most people prefer to stay at home as long as possible. Long Term Care insurance is one way to accomplish this without dipping into family funds or care giving. Let's face it, a LTC event is costly, both mentally and financially. One year stay in a long term care facility can cost up to $90,000. That cost will rise significantly within the next 10 to 15 years. Without long term care insurance the options are very bleak unless you are independently wealthy. Having a plan that can offer financial means as well as a feeling of being in control is an alternative to having everything taken from you.

Secondly, your assets are being protected. There are basically three phases of money: Accumulation, Protection, and Disbursement.

Accumulation Phase

The accumulation phase is what you work for all your life to build up for retirement and to pass on to your heirs. Without a Long Term Care insurance policy, an event like Alzheimer's or a Stroke could definitely put this nest egg of accumulated wealth in jeopardy.

Protection Phase

The protection phase of money is just that, protects what you have worked for and earned over the years. You cannot look at LTC insurance as a cost, but rather a simple way to protect your assets so that they are there when you need them. If these assets are diminished from a LTC event, it could leave you, and or your spouse impoverished for many years to come. Not to mention not being able to pass assets on to your heirs in the disbursement phase of money.

With a Long Term Care insurance policy in hand, the possibility of having choice, being well cared for, not putting a burden on your kids, and being able to live out retirement in the manner of which you are accustomed becomes a real possibility!

In conclusion, long-term care insurance serves two purposes. The first is to provide money to help cover a long term care and event without having to burden our family are children with this responsibility. The second is to protect our nest egg from the financially devastating impact of a long term care event.