I recently had a conversation with a client about their long term care insurance premiums. The difficulty with any insurance is paying for it with the hopes of never having to use the insurance benefit.

This is particularly difficult with long term care insurance. My clients, as many, have seen their rates increase over the past decade with no apparent end in sight.

At issue is insurance companies are now seeing how much long term care actually costs. Years ago, companies estimated the costs of long term care over the remaining life of their insured. And, they were wrong–really wrong. With better medicine and people living longer, costs of care are increasing and those costs are staying around longer than anticipated. So, with the approval of insurance regulators, insurers are increasing their premiums to cover their anticipated costs.

My client has been paying his premiums for about a decade now and recently received another increase notice.  His inclination was to drop the coverage now that the premium is “high”.

After a short discuss of their original reasons to purchase the insurance and noting that nothing has really changed, they decided to keep paying the premiums. After all, the cost of expected care is increasing and they have no family or other means of care. Fortunately, my client can afford the premiums and has saved a good amount for their late life expenses. Many have not planned ahead and are in a difficult situation.

In this article by Darla Mercado on the CNBC, she discusses how to begin the long term care discussion with your family.

And in this article by Wendy Connick on the USA Today site, writes about what long term care insurance is and how to pay for long term care.

Do good, Dan