Hybrid life/long-term care insurance: Is it for you . . . or your heir?

Will you need nursing home care? A friend recently came to a decision that fewer and fewer of us are able to make. At the age of 64 he bought long-term care insurance for himself and his wife. Sales of long-term care insurance, which helps pay for home health care and stays in a nursing home, among other things, have declined in recent years, according to a study by Conning Research & Consulting. Only about 6 percent of all long-term care costs are now funded by insurance. And this is happening even as the baby boom generation moves toward their '80s, when many of them will need long-term care and may not be able to afford it. Nursing homes today cost an average of $81,000 a year, according to Genworth's Cost of Care study -- and that figure will only rise. Mispriced product The problem stems -- in part - from insurance companies themselves. Over the past five years, 10 of the 20 top insurers that sold long-term care insurance no longer do, including MetLife and Unum. Prudential only sells it only to groups. Most were forced out of the business because they had mispriced the product: charging too little. Insurers often created a cascade of… (continue reading......)

Why women hate me for being well-insured

dont-hate-me After a recent flight to New York, I was delighted when my homeowners insurance company reimbursed me for my lost luggage. You're probably thinking, "What a lovely insurer." But while it is lovely, it wasn't a surprise. At least not for me. Throughout my adult life, I've regularly been well-insured. Once, as I was walking through my burnt shell of a house, I was tapped on the shoulder and presented with a beautiful debit card for my hotel bills. Even windshield-repair men frequently shoo my credit card away when I try to settle my glass bill -- I have full auto glass coverage. And whenever I've asked what I've done to deserve such treatment, the insurance adjusters have always said the same thing: My policy covers it. If you're reading this, I'd hazard that you've already formed your own opinion about me -- and it won't be very flattering. For while many doors have been opened (and replaced, literally) as a result of my insurance, just as many have been slammed in my face -- and usually by my underinsured neighbors. Only my friend Samantha's beauty has provoked as much envy and ill behavior from those less fortunate. I'm not… (continue reading......)

Americans would rather work longer than give up luxuries

If you're like some Americans, you don't want to give up your luxuries. Some of us have become accustomed to those occasional filet mignon dinners, morning lattes and getaway vacations. Apparently, we'd rather work longer than give up some of life's little pleasures. According to a Retirement Income Survey released by MainStay Investments, Americans are delaying retirement to maintain their lifestyle. The firm surveyed more than 500 financial advisors and found that 61 percent of them indicated that their clients are not as concerned about their retirement needs as they are with giving up luxuries such as travel and dining out. The survey highlights a significant gap between fantasy and reality for many American households. With the long-term solvency of Social Security questioned, health insurance premiums soaring and retirement funds depleted after the wild stock market ride of '08-'09, working families seem to be wearing rose-colored glasses. Indeed, the survey shows a need for increased education to help individuals prepare for retirement. According to advisors, fewer than half their clients understand how much money they should save to retire comfortably. In addition, advisors agree that their clients need guidance understanding how much of their nest egg they can dip into… (continue reading......)

Living longer requires better financial planning

A recent article in the medical journal Lancet estimates that babies born today will live to 100, and the world population of seniors will soon outstrip the population of those under age 5. Longer life expectancies and changing demographics will surely change the way we view life stages — and how we finance them. Your extra time on earth has to be paid for, perhaps by remaining in the workforce longer or investing better so that you retire with a larger nest egg. Even more importantly is preparing for health issues for your longer life. Living longer doesn't necessarily mean living healthier. Long-term care insurance can guarantee that you can pay for assisted living care or a nursing home in those extra years. (continue reading......)

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