Long-Term-Care Insurance: Weighing the Alternatives – Wall Street Journal – 09/22/12




The Wall Street Journal

Weekend Investor –  Family Value – September 22, 2012

Long-Term-Care Insurance: Weighing the Alternatives

By Charles Passy

Long-term-care insurance is the financial equivalent of gum surgery: something that is often seemingly necessary, but just as often avoided at all costs.

Long-term-care policies help pay for nursing-home, assisted-living and home care costs.

Soaring Costs

With waves of baby boomers retiring, the number of long-term-care seekers is expected to rise to 15 million by 2020—50% more than in 2010, according to the federal Administration on Aging. Meanwhile, the cost of that care is also expected to soar—and it is already plenty pricey for many Americans, with a year in a nursing home easily topping $80,000, according to some reports.

Reduced Benefits

Financial advisers are also increasingly telling clients to forget another aspect of the old policies: that they will cover everything you might need in terms of care.

Comments September 22, 2012

According to the U.S. Department of Health and Human Services, 7 in 10 people over the age of 65 will require long term care. This compares to a 1 in 340 chance of a major auto accident and a 1 in 1,200 chance of a total loss from a fire. Even if your state did not require auto insurance you would still buy it. Even if your mortgage provider did not require homeowners insurance you would still buy it. So, why do you balk on long term care insurance?

Maybe the thought of paying for long term care insurance (or auto and homeowners) for 30 years and not having a claim or getting your money back is unattractive. Nobody wants an auto, homeowners or long term care claim. Like all insurance, long term care insurance transfers the risk from you to the insurance company. While an auto claim may be $20,000 and a homeowners claim may be $50,000, a long term care claim can easily exceed $300,000.

Unlike auto or homeowners insurance, long term care insurance has a refund of premium option. If you die without using your policy the insurance company returns the premiums. With a hybrid life/long term care insurance policy, the insurance company will pay for your long term care or a death benefit. Unlike a traditional long term care insurance policy, hybrid policies do not meet Partnership Program Medicaid asset protection requirements.

Let us research the market and design a long term care solution to meet your needs and budget at:


Aaron Skloff, AIF, CFA, MBA
CEO – Skloff Financial Group

Aaron Skloff, Accredited Investment Fiduciary (AIF), Chartered Financial Analyst (CFA), Master of Business Administration (MBA), is the Chief Executive Officer of Skloff Financial Group, a Registered Investment Advisory firm. The firm specializes in financial planning and investment management services for high net worth individuals and benefits for small to middle sized companies.  He can be contacted at www.skloff.com or 908-464-3060.

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