Long Term Care Insurance presented by ABC Insurance Agency

1
Long Term Care Insurancepresented byABC
Insurance Agency

• Preserve your Lifestyle and Help Protect Your
  Life Savings!

2
What is Long Term Care?

• Long term care addresses a wide range of
  supportive services provided to those who lack
  capacity for self-care due to chronic illness,
  disability or cognitive disorder.
• Long term care services generally last for an
  extended period of time. Levels of care range
  from skilled services to assistance with the
  basic routines of daily life.
• A small percentage of long term care services
  provide skilled services in nursing facilities,
  but most long term care is custodial, provided
  either in facilities or at home.

3
Activities of Daily Living (ADLs)

• Bathing
• Dressing
• Eating
• Toileting
• Transferring
• Continence

4
Cognitive Impairment of

• Memory
• Orientation
• Reasoning

5
Where is Long Term Care Provided?

• At Home
• Assisted Care Facilities 1
• Nursing Homes
• Adult Day Care 2
• Alzheimers Facilities

1. In California, Residential Care Facility 2. In
Idaho and Oregon, Adult Foster Care
6
The Crisis in Long Term Care

• Growing Numbers, Needs and Costs

7
An Aging Population

• By the year 2030, the older populationwill more
  than double to about 70 million.

Source A Profile of Older Americans 2001
Administration on Aging, US Dept of Health and
Human Services
8
Anticipated Growth Percentage of 65-and-Over
Populationversus Total U.S. Population
65 and Over Population
Total U.S. Population
Note Data for the years 2000 to 2050 are
middle-series projections of the
populationReference population These data refer
to the resident population.
Source U.S. Census Bureau Decennial Census Data
Population Projections, Published in Connings
Industry Insight, Issue 4, Long Term Care
Insurance, Published June 2002
9
Disability Prevalence by Age
Source A Profile of Older Americans 2001
Report Administration on Aging, www.aoa.gov
12/21/2001
10
Changing Family Structures

• Fewer children
• Families living far apart
• Women in the workforce
• Both spouses employed

11
More than half of all women and a thirdof all
men who survive to age 65 are expected to spend
time in a nursing home before they die.
Source Wall Street Journal, 2/21/2001
12
Most people traditionally have gotten long term
care at home, usually from a family member. But
today, theres often no one nearby to help out
a result of high divorce rates, smaller families,
and children living away from home.
Source US News World Report, 5/21/01
13
The Crisis in Long Term CareGrows out of
Increasing Costs

• The national average cost of a year in a nursing
  home is 54,900 or 150 per day!

Source GE Long Term Care Insurance Nursing Home
Survey, 3/4/2002
14
Financing Long Term Care

• Who Pays for Nursing Home and Home Health Care?

15
Who Pays for Nursing Home Care?
Private Health Insurance
Other Private Funds
7.5
4.0
Medicare
10.8
25.1
Out-of-Pocket
2.3
OtherPublic Funds
50.3
Medicaid
Source Centers for Medicare Medicaid Services,
Office of the Actuary, 2003 Projected
Expenditures Data Released, January
2002 http//cms.hhs.gov/statistics/nhe/projection
s-2001/proj2001.pdf
16
Who Pays for Home Care?
Private Health Insurance
19.7
Other Private Funds
4.7
18.6
Out-of-Pocket
32.1
Medicare
5
OtherPublic Funds
19.9
Medicaid
Source Centers for Medicare Medicaid Services,
Office of the Actuary, 2003 Projected
Expenditures Data Released, January
2002 http//cms.hhs.gov/statistics/nhe/projection
s-2001/proj2001.pdf
17
Self-Insuring

• Are You Willing to Take the Risk?

18
Public Programs Will Not Resolve the Long Term
Care Crisis
19
Long Term Care Insurance

• Long Term Care Insurance Policies Sold?

20
Estimated Number of In-Force Policies
(numbers in millions)
Source Connings Industry Insight, Long Term Care
Insurance, June 2002.
21
You and Your Family are Insured for theOther
Major Risks to Your Financial Security

• Health Insurance
• Home Insurance
• Auto Insurance
• Life Insurance

22
Reasons for Purchasing Long Term Care Insurance

• Help Protect Assets!
• Help Preserve Independence!
• Avoid Depending Upon Family!
• Protect Retirement Income!
• Quality of Care Choices!
• Peace of mind!

23
Is Long Term Care Insurance Appropriate for You?
24
Selecting a Long Term Care Insurance Policy

• Quality Insurance Company?
• Claims paying experience?
• Policy Provisions?
• Benefit Triggers?
• Coverage of all Levels of Care?
• Inflation Protection Option?
• In force policy rate increases?

25
Important Features and Options ofthe Individual
Policy that You Select

• Premium
• Daily Benefit Amount
• Lifetime Maximum
• Tax Qualified
• Care Coordinator

26
As Many as 130 to 140 CompaniesCurrently Sell
Long Term Care Insurance

• How Can You Choose the Right One?

Connings Industry Insight, Long Term Care
Insurance, p7, June 2002.
27
Selecting a Long Term Care Insurance Company
Select a company that has a longstanding national
reputation for product quality and customer
service. Ask for the insurance companys
financial rating.1 Investigate the companys
financial strength and claims paying ability by
checking its ratings with the A.M. Best rating
service and the Standard and Poors Rating. These
ratings result from analyses of a companys
financial records.1 Make sure the company you
select has been in the long term care insurance
business for more than 15 years. The number of
years a company has been selling LTC insurance is
an indicator of their experience with stabilizing
premium rates. Select a company with a large
number of policies sold. The greater the number
of policies, the larger the risk pool from which
a company pays its claims. Finally, make sure
that the agent selling the policy has long term
care insurance expertise.
1 Health Insurance Association of America (HIAA),
A Guide to Long Term Care Insurance, 2002.
28
Long Term Care Insurance

• Help Preserve Your Independence!
• Help Protect Your Assets and retirement income!
• Prevent becoming a burden to your family!
• Receive care where and when you want it!
• Have peace of mind!