To Self-Insure or Not

To self-insure - Is that really an alternative?

Some may believe they can afford to self-insure. But even those with significant assets could erode their savings very quickly should they need long term care.

Just consider the following example. If your client saves $1,500 per year and obtains a 7% rate of return annually over 30 years, that money grows to just $142,000. But if they were to buy a long term care policy that also costs $1,500 per year the policy benefit maximum could grow to $889,000.14

The truth is that anyone with assets to protect would prefer to leave them to family, friends or a charity instead of an assisted living facility or nursing home.

Most long term care patients and their families paid for the cost of care. It is most likely that the money came from their life savings, their retirement savings or portfolios.

Asset (Savings, CDs etc), Income	Protection Method
home	homeowner's insurance
car	car insurance
family	life and health insurance
wealth	life insurance
income	disability insurance
all above	health insurance
retirement assets, retirement income	what protects this?

Can you think of anything other than the cost of long term care that could deplete your lifetime savings, retirement income, or portfolio?

If you needed long term care tomorrow, what would be the consequences to those around you?

It's the consequences that matter, not the money. Once someone needs care money no longer becomes an issue. Once someone needs care no amount of money can buy insurance. Their decision to self-insure will prove to be right or wrong.

Would it have been a mistake to insure for Long Term Care? 1. You Insure for LTC You Need LTC No Mistake 2. You Don't Insure for LTC You Don't Need LTC No Mistake 3. You Insure for LTC You Don't Need LTC Yes Mistake 4. You Don't Insure for LTC You Need LTC Yes Mistake Which mistake would you rather make?

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