Nursing Home Insurance – How to Reduce Costs
Most individuals find that the advantages of nursing home insurance packages far outweighs the costs. From the time you reach 65 or so, a solid likelihood is you’ll require some sort of long term nursing home care. As you contemplate how you can potentially pay thousands of dollars a year on your premiums, it’s easy to see why the equation makes sense. When you weigh up the current value of your home against the potential costs of a stay, it becomes clear that a package of long term care insurance makes a lot of sense.
If you’re paying out more for insurance than is absolutely necessary, then the best strategy is to use an independent agent to obtain multiple quotes and find the cheapest option. Most people think buying a policy from a large company is the only way to get the best insurance coverage, but this is generally not true. Smaller companies often provide better prices and are more likely to be able to offer better discounts.
When looking for an affordable policy it’s also important to remember that just because a rate is cheaper doesn’t necessarily make it the best insurance deal. You should always shop around, taking into account both premiums and the elimination period. The best nursing home insurance packages contain a high level of flexibility. This means that you don’t have to stick with the same level of cover as you originally choose. There are often several different packages with different levels of coverage, so by getting multiple quotes you can compare what is available on the market. If an independent agent helps you do this, then you’re on the right track.
Some policies have annual inflation-adjustment factors. Unfortunately, the inflation-adjustment factor is sometimes used to dramatically increase a policy’s price without a corresponding decrease in quality. An example of this would be an inflation-adjustment factor that takes into account recent increases in the cost of medical supplies, which will typically raise the price of a policy significantly. If you find a policy that has an inflation-adjustment factor of 10% and you subsequently need a larger sum of money each year to cover nursing home costs, then the policy isn’t really worth the additional price. Instead, get a policy that offers you a lower initial premium but a larger sum of money to save for your future nursing home insurance costs.
In many cases, the easiest way to reduce nursing home insurance costs is to simply stay behind the curve. Insurance companies adjust their rates according to general inflation, so the only real way to get a lower rate is to stay a little longer and get a higher deductible. By raising your deductible, you’ll pay less in the long run. For example, let’s assume that your expected lifetime earnings are $60k. You’d need a deductible of ten thousand dollars to get a premium that is one percent less than your current one. Alternatively, get a higher deductible and lower monthly payments.
In addition, some policies offer you a discount if you purchase a long-term care policy using an independent agent. Independent agents are connected with multiple insurance companies, so by purchasing through an independent agent, you essentially receive a discount on the purchase of a policy. Ask your friendly agent if they offer this type of discount, or if you must pay a larger deductible in order to take advantage of this perk. In some cases, you can obtain a discount that is as much as five to ten percent of the nursing home insurance costs you’d normally pay.
If you don’t want to use an independent agent, or if you can’t afford to pay the high costs of using one, there are other ways to reduce the nursing home insurance costs. One of them is to consider reducing the length of your stay. The more time you’re allowed to remain in your home, the lower the overall premiums will be. The longer you’re confined to your own home, the greater the financial burden may be on your loved ones, especially if you require more than one type of care. You may also be able to lessen your premiums by increasing the amount of coverage you want. For example, if you already have coverage for hospital stays and routine care at home, you may want to consider eliminating the coverage for overnight stays and extra medical procedures.
It’s always a good idea to compare the prices of different types of insurance from different insurance carriers. Many companies will offer you a rate quote on the phone or online. Compare these quotes and choose the company that offers you the best price. You should do this before you complete any kind of nursing home insurance agreement.