Comprehensive Capabilities

  The foundation of AWP Life Brokerage is the belief that firms are strengthened by the ability to work in tandem as a unified consortium.  Our specializations include insurance concepts and...


Industry Leader

  AWP has proven continual leadership in delivery of benefits solutions for companies of any size as well as we continue to be a leading enterprise in life insurance planning and...


Institutional Relationships

Institutional accounts are integral to our overall distribution plan.  We define institutions as banks, wirehouses, regional broker dealers, and CPA networks. AWP has acquired recognition as a player in the institutional...


Pioneering Captive Insurance

Introduction Despite the fact that the concept of “captive” traces its origins to the beginnings of formalized trade, many people believe captive insurance companies to be a relatively new phenomenon.  Formed...


Premium Financing

Many affluent clients are aware of the benefits that life insurance can provide.  However, clients often harbor concerns that a substantial income tax liability will result from liquidating low basis...


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Long Term Care

 Consider the following statistics, which promote awareness prompt most into looking into obtaining some kind of long-term care insurance (LTCI).

 

 

 

- An average of 69% of people age 65 and older will require some form of long-term care.

 

- The daily cost of a private nursing home room on average in 2008 was $217 or $79,205 annually.

 

            In some areas the cost is considerably higher: Alaska ($183,595), New York, NY             ($160,965), Stamford, CT ($148,920), California ($100,000), and Pennsylvania             ($93,075).

 

- Of American who are 65 and older and have incomes exceeding $20,000, only 16 percent have LTC insurance.

 

- “Failure to prepare for the cost of a nursing facility stay or other long-term care is the primary cause of impoverishment among the elderly.” (The American Health Care Association, 1997)

 

Do you have LTCI?

Based on the above statistics, we know for most the answer is NO.

 

Should you have LTCI?

Based on the above statistics, we know the answer is YES.  Given that the average cost of a nursing home stay is $80,000 per year, how many years would it take of staying in a nursing home before a sizeable percentage, if not all, of your wealth was spent?

 

Why don’t people purchase LTCI?

There are two main reasons people do not buy LTCI.  1. Cost.  It can be expensive.  2. Need.  Many people believe they will never have a use for LTC and are saving by deferring LTC expenses.

It is an unfortunate truth that the people who buy LTCI are those who have had a loved one or friend who experienced the devastating impacts of LTC costs and didn’t have LTCI.

 

What does LTCI cover?

LTCI coverage depends on the policy purchased.  Policies range from those that cover only nursing home care to those that cover in-home care in addition to a number of other expenses.  Coverage will have a pre-defined limit (usually a daily or monthly limit).

 

What triggers LTCI coverage to kick in?

Typically, LTCI coverage becomes active when you can’t perform “2 of 6 ADLs.”  ADL is an acronym for activities of daily living: Bathing, Dressing, Toileting, Transferring, Continence, and Eating without help.

 

LTCI Options

There are many different ways to obtain LTCI coverage and, depending on your situation, one may be more suitable for you than another.


Traditional LTCI—The optimal but also most expensive form of LTCI.  An annual premium of $2,500-$10,000+ is paid per year (depending on your age), and if you incur LTC expenses, the policy will pay up to its daily limit.  Traditional LTCI is similar to term life insurance; if unused your premiums are not returned to you.


Single Premium Life Insurance policies that have LTC benefits—Most people are unaware that they can purchase a life insurance policy that has a LTC benefit.  Purchasing this type of policy is advisable because if the money paid in premiums is accessible if ever you need it.  For example, if you paid a $200,000 one-time premium for a policy and suddenly needed the money in later years, you would be able to ask the insurance company for a refund on your entire premium.  Additionally, some policies grow money in the policy similar to money market/certificate of deposits.  This form of policy is particularly appropriate for older clients who have money in CDs and money market accounts because they believe they may need the money in the future, and as such have no desire to allocate it to buying traditional LTCI.