Because of a new trend in long term care insurance, it’s expected that women will be paying more for coverage than men.
Providers are treating men and women differently in setting rates, so women could soon pay 20 to 60 percent more, according to the American Association for Long-Term Care Insurance.
This has produced a rise in interest among women themselves who could be looking to lock in lower rates before prices rise. There are a number of important questions that women should ask when looking into a policy, according to the AALTCI.
“The move to sex distinct rates is prompting many women, especially those who live alone, to request information,” Jesse Slome, executive director of the AALTCI, said in a statement. “That’s a good thing but it’s easy to make mistakes in your rush to lock in the significant savings that are available if you act before rates rise.”
The association’s own research indicates that premium costs can vary significantly among carriers.
“A 55-year old woman who is in good health could purchase equal amounts of coverage from one company for about $100 a month or as much as $200 a month for basically the same protection,” Slome said. “Each company sets their own rates and each has sweet spots and a failure to compare correctly could be a costly mistake.”
That $100 monthly premium would purchase roughly $170,000 of current protection that would grow to about $350,000 when the policyholder reaches age 80. Beyond the basic premium information, it’s important to take the time to dig down and get the details of each policy, given the potential for long-term ramifications.
“This is a highly specialized field today and it’s the small print buried within each contract that matters not today, but down the road when you expect to get benefits,” Slome said “Novice producers who only sell one or two policies a year rarely take time to read policy language or have the experience that comes from years in a business.”
Slome said it’s important to first ask how many insurance companies an agent can sell policies for.
“Some agents can only sell one company who they will tell you is the best, but some are appointed to sell multiple companies and so they are better suited to do a fair and balanced cost and benefit comparison,” Slome said.
Asking how many years an agent has been selling long-term care insurance can provide a good measure of the agent’s experience and expertise.
“No one wants to be a brain surgeon’s first patient and I’d say the same is true for buying this important protection,” Slome said.
Finally, Slome suggests asking how what percentage of their business is focused on long term care insurance.
“There are specialists who spend the majority of their time advising people on the topic and they typically have the most up-to-date knowledge which they will share with you,” Slome said.
