7 Worst Long Term Care Insurance Companies | Is it worth it?
7 Worst Long Term Care Insurance Companies | Is long-term care insurance worth it. You maybe thinking of not spending part of your retirement in a long-term care facility or having skilled nursing care come to your home to assist you with daily activities.
There are some insurance companies you should out rightly avoid. They have been branded as the worst long-term care insurance companies. So if you want to buy long-term care insurance, you’ll want to avoid these companies.
What is Long-Term Care Insurance?
Long-term care insurance is an insurance product, sold in the United States, the United Kingdom, and Canada that helps pay for the costs associated with long-term care. Long-term care insurance can help you pay for the costs associated with your care as you get older and need help with everyday activities — such as bathing, dressing and eating — or care related to diseases like Alzheimer’s, Parkinson’s and dementia.
You are qualified for long-term care when you need help for 2 out of 6 activities of daily living (or ADLs) such as bathing, toileting, eating, getting around, grooming, and dressing.
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List of Top and Best Long-Term Care Insurance Companies
- Golden Care Insurance: Best Marketplace.
- New York Life: Best for Financial Stability
- Northwestern Mutual: Runner-up for Financial Stability.
- Nationwide: Best for Customer Satisfaction
- Pacific Life: Runner-up for Customer Satisfaction.
- Mutual of Omaha: Best for Discounts.
The Worst Long Term Care Insurance Companies
1. AARP Long-Term Care Insurance
AARP is a trusted name among the senior population. They offer a lot of useful content to guide the senior consumers into their retirement and specific benefits for the seniors. They also create a vibrant community of seniors to stay in touch and learn from one another. AARP partners with New York Life to provide long-term care insurance.
2. New York Life
New York Life is endorsed by the AARP, but that doesn’t mean they offer a great long-term care policy. It’s also one of the most expensive long-term care insurance, sometimes by almost twice the amount of other companies offering long-term care insurance.
3. MassMutual
MassMutual is one of the insurance companies still offering traditional long-term care insurance policies. These policies are harder to come by because decreasing profits caused many companies to leave the market. MassMutual also offers two hybrid long-term care insurance policies, CareChoice One and CareChoice Select, which are both whole life insurance policies with long-term care riders.
4. Liberty Mutual
While it may not be as good at denying and delaying claims as State Farm and Allstate, Liberty Mutual sought the help of the same consulting firm that the other two companies did to reduce costs. They have used the tactic of abandoning and refusing renewal to clients in high-risk areas such as those susceptible to hurricanes or floods.
5. State Farm.
This company has committed some truly deplorable acts to avoid paying its clients. After Hurricane Katrina, they altered engineering reports about damage from the storm, and they have also forged signatures on earthquake waivers after significant earthquakes. State Farm is the largest property-casualty insurance company in the country. Like most insurance companies, they will go to extreme lengths to delay and deny claims.
6. CalPERS
Technically, CalPERS has “suspended open enrollment” in the long-term care program. Just in case they get back to it (which is unlikely) you should know that they are also the subject of a class-action lawsuit due to rate hikes and reduced benefits. Just days ago, they approved a 77% rate increase for current LTC customers.
7. AIG.
The AIG is one of the worst long-term care insurance companies. AIG is the largest insurance company in the world, and somehow they have gotten away with mistreating their clients for years. There have been allegations that the executives of this company strategically try to increase prices when there is a catastrophe.
What is Covered Under Long-term Care Insurance Companies?
Every insurance company has its own share of what it covers in its long-term care. They typically allow you to use your daily benefit in a variety of settings, including:
- Hospice care.
- Respite care
- Assisted living facilities (also called residential care facilities or alternate care facilities)
- Alzheimer’s special care facilities
- Your home
- Adult day service centers.
- Nursing homes.
In the home setting, comprehensive polices generally cover these services:
- Occupational, speech, physical, and rehabilitation therapy.
- Skilled nursing care.
- Help with personal care, such as bathing and dressing.
How Much Does Long-term Care Insurance Cost?
A traditional long-term insurance policy with a total of $216,000 LTC benefit for 3 years can cost a 50-year old $2,000 to $3,000 a year; a 55-year old $2,200 – $3,400; a 60-year old $2,500 – $3,900 a year; and a 65-year old $13,500 – $14,700 a year.
Long-term care is expensive, and so is long-term care insurance. The younger you buy a long-term care insurance policy, the cheaper you can get. The best age to buy a long-term care insurance policy is in your early 50s or late 40s. And of course, your health condition plays a big role in the premiums of your long-term care policy.
Is long-term care insurance worth it
Buying long-term care insurance would only save the state not you—money. If you expect to have a lot of money when you need long-term care services, you also probably shouldn’t buy long-term care insurance. Instead, you should plan to pay for the care “out of pocket” that is, as a regular expense.
The 5 Best Hybrid Long-Term Care Insurance Companies
You can also consider alternatives to traditional long-term care insurance. One of the most popular options is a hybrid long-term care insurance policy, or also called linked policy.
- Securian SecureCare: Best value.
- Lincoln Financial MoneyGuard: Best for no elimination period.
- Pacific Life Premier Care Choice: Best for flexibility.
- OneAmerica Asset Care: Best for couples
- Nationwide Care Matters: Best for cash indemnity policy.
What is Hybrid Long-Term Care Insurance?
One of the disadvantages of traditional long-term care insurance is that after paying a lot of money for it, if you end up with not needing it, you will get nothing from your policy. To address this concern, hybrid long-term care insurance was introduced.
It is a linked policy of a permanent life insurance policy and a long-term care insurance policy. If you have a hybrid long-term care insurance policy and you end up with not needing it, you can either get your premiums back or your family will receive a tax-free death benefit as if you owned a permanent life insurance policy.
