When to buy long term care insurance greatly depends on your current age and health as the two are highly correlated. As a person ages, the health gradually becomes frailer. These two factors play an important role if you are intending to apply for long term care insurance. There is one fact that most people tend to overlook about long term care insurance application—you need to be health qualified. The healthier you are, the bigger the chance that you’ll be granted this policy. As the popular saying entails, it is your money that pays for long term care insurance premiums, but it’s your health that actually buys it.
The Ideal Age to Buy
A lot of people are wondering at what age to buy long term care insurance. It is advised that you purchase while you’re in your 50′s. First, your health is still in great shape during this time. Second, age is also a basis whether you’ll qualify for long term care insurance or not. Annual increases on your premiums are also parallel with your age. For people who are in their 50′s, rates can increase by about 2-4%. Meanwhile, for those who are in their 60′s, it can go as high as 6-8% percent. Applying early lets you save and this savings can go to other investments or your retirement nest.
Health and Discounts
A superb health condition greatly works for your benefit when it comes to long term care insurance. Companies usually offer discounts if you buy LTC coverage while your health is still at its prime. More so, this discount is locked-in. This means that your discount remains, regardless if you get ill or diagnosed with a medical condition in the future. As per the American Association for Long-term Care Insurance 2010 Sourcebook, there are a great percentage of people being qualified primarily because of good health. 62% of applicants between the ages of 40-49 have been granted. Same goes for the 46% of applicants between the ages of 50-59 and 38% of people aging 60-69.
Preexisting Conditions: Lesser Chances
There are two scenarios that you might face if you have preexisting conditions and you want to apply for long term care insurance. First, you may not qualify at all. Second, your application can be accepted but you’re premiums will cost higher. Data from the American Association for Long-term Care Insurance 2010 Sourcebook, 14% of applicants between the ages of 50-59 who have preexisting conditions have had their applications refused. Meanwhile 23% of those aging 60-69 has also been declined. Even if you qualified while having underlying medical conditions, there can still be drawbacks on your end. Some companies can offer coverage for your preexisting condition, but it will set a waiting period before that certain benefit will start to kick in. If you want to get the best deal out of long term care insurance, use your age and health to your advantage. You may have the means to pay for the cost of premiums, but that will be all for naught if you can’t qualify simply because of your age and the state of your health. So to the question, when should I buy long term care insurance: purchasing early will no doubt make the application process smooth for you. Apart from that, it can also be advantageous to your wealth, as applying early can generate savings on your end.