Long-term care insurance (LTCI) is that form of insurance meant to provide care and support not available under health insurance and usually, for an extended duration. It helps in looking after those who are not able to undertake daily life chores without assistant. Over time, the increasing product costs have slowly turned LTCI into a lucrative business.
This paper presents an annotated bibliography on LTCI, what will motivate someone to acquire a policy and who may need it.
America’s Health Insurance Plans (2004). Guide to Long-Term Care Insurance. Web.
In this study, long-term care is seen to cover much more than what is available under medical care. It includes the help one may need when faced with perpetual sickness or some form of disability making it impossible for them to take care of their needs. As per the study, a greater number of older Americans will be physical impaired in one way or another and will as result, need long-term care. Even though a majority of those who mostly use long-term care services are the older people, the study also observes that any young person involved in an accident might require the services.
Gilmour, R. (1992). Long-Term-Care Insurance: Who Really Needs It? Journal of Financial Planning, 5 (4), 144. Web.
In this article, the author observes that most financial planners often recommend long-term care insurance for older clients based on statistics show that a great number of the aged population will need long-term care in the future. The author, however, refutes these claims and argues that only a small percentage of aged Americans spend time in nursing homes contrary to the revelations by the statistics. According to the author the very elderly are the ones most affected. Also at risk are handicapped men and women. Although married couples are considered the main target of long-term care services, they are much less at risk than is supposed.
Hansen, L.J. (2009). Consumers Ask: Should I Purchase Long-Term Care Insurance? Journal of Extension, 47 (1) Article Number 1TOT3. Web.
In this article, the author looks at the challenge facing 70 million American baby-boomers. He argues that due to technological advances coupled with improved adoption of good health habits, the baby-boomers are likely to live much longer. With the elongated life, however, comes the need for long-term care services. Due to the high costs associated with LTCI, the author believes it is important for customers to be equipped with unbiased information to aid their decision making process. If properly educated, clients will be able to take a critical look at their financial positions and whether or not they really should purchase LTCI. The author also mentions that acquiring a policy without much thought could exhaust ones resources leaving them in a difficult position.
Lown, J. M. & Palmer, L. (2004). Long Term Care Insurance Purchase: An Alternative Approach. Financial Counseling and Planning, 15 (2). Web.
The authors in this article show that sales people, motivated by powerful incentives, aggressively market LTCI by referring to frightening figures showing a high need for long-term care services. The authors strongly advise consumers to be very vigilant whenever subjected to a policy sale. Before rushing to acquire a long-term care insurance policy, a consumer should take time to look at their retirement assets as well as anticipated costs of living after retirement before making a decision to purchase long-term care insurance. To avoid purchasing a policy and later dropping it, the authors argue that potential clients should be well educated about the need and choice of LCTI.
Following from the above discussion, one may or may not need long-term care services. It is therefore important that consumers are not left at the mercy of sales persons who are just out to enrich themselves. They should be thoroughly educated regarding long-term-care insurance so as to empower them to make informed decisions that will lead to no regrets later.