Comments on: Planning around Long-term care need if one cannot (or doesn’t want to) buy LTC insurance http://asset-aid.com/blog/2010/01/18/non-ltc-insurance-solution-to-finance-long-term-care-need/ Tue, 07 Sep 2010 23:19:49 +0000 http://wordpress.org/?v=2.0.1 by: Linda http://asset-aid.com/blog/2010/01/18/non-ltc-insurance-solution-to-finance-long-term-care-need/#comment-15370 Sun, 05 Sep 2010 10:23:30 +0000 http://asset-aid.com/blog/2010/01/18/non-ltc-insurance-solution-to-finance-long-term-care-need/#comment-15370 I can see the benefits of ltc / cii for the self employed, those without disability insurance and who want to plan for continuity of lifestyle...but when it comes to the ltc needs of the elderly, the inevitable decline, doesn't the government subsidize us in this? And then if you buy a small policy, wouldn't the governmet take this as income and subsidize you less? I kind of see income taxation as an ltc policy for my senior years. The higher end ltc facility/residences perhaps are not available to subsidized people? But to afford thisyou'd have to buy a massive ltc policy, wouldn't you? And have crippling payments in today's dollars. What are your thoughts? And then CII...I like the idea of being able to buy alternative therapies/expensive drugs not available on ohip. Which CII policies have you investigated? --------------------------- Thanks for your comments and questions, Linda. Regarding the government subsidy one can rely on: sure, there is some support, and you can learn about that via my posts or elsewhere. The question is speed, quality, and choice. In these regards, the situation and the trends are not good. It's true that LTC insurance premiums are not very low, the reason for it being that the chances these policies will actually be used (will pay benefit) are high. I think it's true for any insurance that buying it is not a must; from the perspective of a penniless person, it's a (desirable) luxury. (There are some business situations where to obtain insurance is an obligation - as a condition of getting a loan or setting up a partnership, e.g. - but getting into those situations is a matter of choice in the first place, so we're back to square one.) Where it comes closest to a moral obligation, in my eyes (or even a legal one, as reflected and prescribed by a separation/divorce agreement, e.g.), is when someone is protecting a dependent child (usually by insuring against consequences of death, illness or accident striking the parent), ... but there have been many orphans even who grew up fine. In other words, even for someone with a dependent, making insurance decisions is a matter of personal choice, and an advisor's role is to help the deliberation leading to it to be an informed and reasonable one. Insurance is not a social service, in the sense that those who'd need most the lump sum or regular benefit payments it may provide are the least likely to afford paying for the protection. Whether spending on it is worthwhile and affordable to you has to be your own decision. Many people make that kind of decision (either for or against) hastily, purely out of emotions, and disregarding facts and reasonable analysis. I try to help those who'd rather go for a more careful, balanced process, relying on detailed information and sensible analysis. To be able to that, among other things, I must have to be familiar with most policies available, because they are certainly not carbon copies of each other. This is the case with the critical illness policies as well, about which you've asked. Please feel free to ask more or argue with my views if you like. Regards, Laszlo I can see the benefits of ltc / cii for the self employed, those without disability insurance and who want to plan for continuity of lifestyle…but when it comes to the ltc needs of the elderly, the inevitable decline, doesn’t the government subsidize us in this? And then if you buy a small policy, wouldn’t the governmet take this as income and subsidize you less? I kind of see income taxation as an ltc policy for my senior years.

The higher end ltc facility/residences perhaps are not available to subsidized people? But to afford thisyou’d have to buy a massive ltc policy, wouldn’t you? And have crippling payments in today’s dollars. What are your thoughts? And then CII…I like the idea of being able to buy alternative therapies/expensive drugs not available on ohip. Which CII policies have you investigated?

—————————
Thanks for your comments and questions, Linda. Regarding the government subsidy one can rely on: sure, there is some support, and you can learn about that via my posts or elsewhere. The question is speed, quality, and choice. In these regards, the situation and the trends are not good. It’s true that LTC insurance premiums are not very low, the reason for it being that the chances these policies will actually be used (will pay benefit) are high.

I think it’s true for any insurance that buying it is not a must; from the perspective of a penniless person, it’s a (desirable) luxury. (There are some business situations where to obtain insurance is an obligation - as a condition of getting a loan or setting up a partnership, e.g. - but getting into those situations is a matter of choice in the first place, so we’re back to square one.) Where it comes closest to a moral obligation, in my eyes (or even a legal one, as reflected and prescribed by a separation/divorce agreement, e.g.), is when someone is protecting a dependent child (usually by insuring against consequences of death, illness or accident striking the parent), … but there have been many orphans even who grew up fine. In other words, even for someone with a dependent, making insurance decisions is a matter of personal choice, and an advisor’s role is to help the deliberation leading to it to be an informed and reasonable one. Insurance is not a social service, in the sense that those who’d need most the lump sum or regular benefit payments it may provide are the least likely to afford paying for the protection. Whether spending on it is worthwhile and affordable to you has to be your own decision.

Many people make that kind of decision (either for or against) hastily, purely out of emotions, and disregarding facts and reasonable analysis. I try to help those who’d rather go for a more careful, balanced process, relying on detailed information and sensible analysis. To be able to that, among other things, I must have to be familiar with most policies available, because they are certainly not carbon copies of each other. This is the case with the critical illness policies as well, about which you’ve asked.

Please feel free to ask more or argue with my views if you like.

Regards,
Laszlo

]]>