Stable? Long Term Care Insurance Home Care Path

The need to insure against long term care risk has not changed. An aging population with the ability to live longer means an increased need for in home supportive care. But, the long term care insurance industry is facing some financial instability itself.

Insurance companies invest collected money in portfolio funds to help meet plan benefit pay outs. A one percent drop in interest rates requires the insurance company to collect an additonal 12 percent through a premium increase to compensate for the loss. Interest rates are at an all time low, driving up long term plan premiums.

Long term care insurance plans were assembled with the notion that larger numbers of users would stop paying premiums. Long term care policies require that customers keep current on premium payments from the time of purchase up intil the point when a claim is made. The health plan believed more would stop paying, lapsing coverage, meaning less pay out for the long term care insurance company. Less than estimated numbers of users have walked away from in force long term care policies. Long term care insurance companies have sought premium rate hikes through state insurance commissions to compensate for the perceived loss.

The surprise premium hikes have got consumers questioning the stability of the long term care insurance industry. The message from Home Care Path www.homecarepath.com is remember we are in a changing health climate. The premium increases are a lead indication of coming long term care insurance industry changes. Expect the long term care insurance industry to market less expensive policies with more limited benefits. The industry will package plans to create a new attraction for the offerings. Some will combine a form a life insurance with some long term care products to keep the high end market interested.

Home Care Path encourages all seniors to meet with a qualified unbiased financial consultant prior to purchasing a long term care policy. Fee only financial planners often do not receive sales commissions for steering individuals into a specific product line.