Long Term Care
As insurers endeavor to make long-term care policies more affordable, some are developing new products that combine long-term care insurance with life insurance. These life insurance hybrids require an investment in a lump sum or payment of premiums for ten years, after which the insured receives either long-term care payouts or their heirs receive a death benefit. For instance, a 60-year-old would invest $50,000 and, in turn, could receive payouts of up to $216,000 (up to $3,000 per month for six or more years) for long-term care in a nursing home or assisted living facility or at home. If he or she were to die before long-term care is needed, his or her heirs would receive a $72,000 benefit.
NOTE: In the insurance hybrid mentioned above, funds used for long-term care reduce the death benefit to heirs.Read More
Will the Affordable Care Act Come to the Rescue?
As the major insurance coverage provisions of the Affordable Care Act continue to pick up steam, a recent survey indicates that nearly half of working U.S. adults were uninsured or underinsured at some point in 2012. According to the survey, about 30% of adults between ages 19 and 64 went without health insurance for part or all of 2012, which is nearly 10 million more than the 26% who went without coverage in 2003. An additional 30 million people were considered “underinsured,” which means that, although they had insurance, they also had out-of-pocket costs so high that it was considered to be an obstacle for them. Hopefully, the Affordable Care Act will help to severely reduce these numbers.
NOTE: In the survey mentioned above, “underinsured” was defined as out-of-pocket expenses that reached 10% or more of income (5% or more if income was below 200% of the federal poverty level) or deductibles that were 5% or more of income.Read More
Covering the Medigap
Anyone approaching age 65 who will be enrolled in Medicare Part B should consider shopping for Medicare supplement insurance, popularly known as “Medigap” insurance. These policies, which are sold by private insurance companies, are designed to provide reimbursement for out-of-pocket costs that are not covered by Medicare. Although Medicare covers many health-care costs, patients must still pay Medicare’s coinsurance and deductibles. There are also some medical services that Medicare does not cover. A person’s right to purchase Medigap insurance is guaranteed during a six-month interval that begins on the first day of the month in which he or she is 65 or older and enrolled in Medicare Part B regardless of the condition of his or her health.
NOTE: Medicare Part B is an optional premium-based plan that covers physician services and outpatient hospital care.Read More
Learning About Exclusions
An insurance policy’s section on exclusions lets the policyholder know exactly what areas are specifically not covered by his or her insurance contract. Exclusions do not take anything away from the policyholder because the insurance company certainly does not charge a premium for coverage that it does not provide. In fact, exclusions eliminate exposures that the insurance company could not insure without charging prohibitive amounts of money. By taking careful notice of exclusions, policyholders can use the information to their advantage by avoiding gaps in coverage and purchasing additional protection. For instance, homeowners who astutely recognize the earthquake exclusion in their homeowner’s coverage can then obtain earthquake coverage through an earthquake endorsement.
NOTE: Common life insurance policy exclusions include acts of war, suicide, and engaging in certain dangerous activities.Read More
Have You Thought About Disability Insurance?
Most breadwinners with family responsibilities do not give disability insurance the same amount of consideration that they give to life insurance. However, heads of households may want to consider that just over one in four of today’s 20-year-olds will become disabled before they retire. This statistic alone should lead them to consider what would happen to their families if they were to lose their ability to work, even for a relatively short period of time. While some companies provide group disability insurance to their employees, the policies may be limited in their coverage. Private disability insurance is available as a supplement to group disability insurance, or it can provide protection for employees with nothing else to rely on.
NOTE: While those working in laborious jobs might be expected to be more vulnerable to injuries that lead to disability, cancer does not care what your job is.Read More