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It may not feel like it at times, but not everything goes up in price. Electronics and life insurance are two good examples. Long term care such as nursing home and home health care, however, is increasing at an alarming rate and is almost guaranteed to do so in the future as far as anyone can see.
With the aging population and people living longer, the demand for long term care facilities and the professionals that supply the care are going to be in high demand with short supply. Long term care, whether in an assisted living facility, nursing home, home health, or hospice care, can cost in excess of $50,000 per year in Virginia. Even modest increases over a number of years until the coverage is needed would make the cost of care staggering.
A long term care policy purchased to cover today's cost of care will be inadequate for the future. This problem can be solved by adding a rider to the policy which provides inflation protection. The rider increases policy benefits each year to keep up with the ever-increasing cost of care. The younger you are, the more important it is to have such a protection since it may be many years down the road until the coverage is used.
There are a few things of inflation protection worth examining:
Compound Inflation- This rider increases the benefit by a certain percentage each year on compound basis. In other words, the amount of increase is greater each year since the percentage is applied to a higher base rate.
Simple Inflation- This rider increases the benefit by a percentage each year on an equal basis. The amount of increase is the same each year. This option is less expensive than compound and may be sufficient for someone who is elderly, whereby inflation would not have so many years to wreck havoc on the cost of care.
Option to Purchase- This does not increase the benefit at all on an automatic basis; it simply gives the insured the right to purchase an increased amount of coverage without proving insurability.
Long term care is the most often over-looked component of a solid financial plan.
You can learn more about coverage options, policies available in your area, and get a free no-obligation quote by visiting FindMeAPlan.com.
Have you ever asked yourself about long term care insurance? Maybe you have heard of the term, but have not fully understood what it meant and how it could serve an importance purpose in your life.
As working individuals, we hope to save our hard-earned income throughout our lives so we can enjoy a laid-back lifestyle during retirement. However, many unforeseen dangers can arise and strike our families at any given time. If something happens where you or your spouse is forced to live in a long term medical care facility, the money saved will disappear quickly and could potentially wipe out what was left to care for your family. Studies show that 2 of every 5 Americans over age 65 will enter a nursing home during the remainder of their life (A.D. Banker). Virginia long term care insurance will protect these assets, leaving your family protected if you need permanent medical care. Some states, such as Virginia, even demand all policies must provide inflation protection, which only further benefits you.
Virginia long term care policies have many options for coverage. The policies must offer care for a skilled nursing facility, an intermediate care facility, and a custodial care facility. Some insurance companies in Virginia will offer additional optional coverage. This includes home health care, which consists of home convalescent care and residential care. Home convalescent care is health care that is provided in the insured's home. The insured's physician sets a recovery program that must be followed by the patient. Residential care provides living accommodations within a long term care facility, but tends to be much more expensive. Other optional coverages include hospice care, adult day care, and respite care.
Because of the nice benefits and coverage long term care insurance provides, steep price tags are usually associated with the policies. However, premiums can be reduced by increasing the elimination period and benefit period. Most benefit periods hover between two and five years, but policies can be written for the life of the insured. Obviously, lifetime benefits will result in a higher monthly premium. The length of the benefit period is chosen based on what you feel comfortable with and what you can afford. In Virginia, benefit periods cannot be less than 12 months, but this can vary among states.
As costs of medical care continue to increase, the holding of a long term care policy becomes more important. According to a study by the US Department of Health and Human services, the average cost of a semiprivate room in a skilled nursing facility is around $66,000 a year. Medicare covers skilled nursing facility care for approximately 3 months, so the bills can build quickly. If you have a valuable collection of assets you wish to leave for your family, you should consider checking into a Virginia long term care policy to prevent your money from being sucked down the drain. It would be a shame to gamble away your savings accumulated throughout your life by not being insured with long term care.
Most people correctly believe that you should protect things of great value, especially those that we go into a lot of debt for, such as a home mortgage. Most families could not afford to maintain a mortgage payment if the breadwinner were to die; therefore, mortgage life insurance would seem to be the natural solution. The concept is good, but has some pitfalls.
Mortgage life insurance is a decreasing term policy. This means that the amount of insurance decreases each year as the mortgage balance decreases. Although the premiums remain the same, as the insurance decreases, your real cost of insurance is increasing. The solution would be to purchase a level term policy. Level term can be purchased for 10, 15, 20, 25, or 30 year terms. Competition among insurers for this market and more favorable mortality tables have made level term just as affordable as decreasing term. If death occurred during the latter years of a mortgage, there would be funds left over for other expenses after paying off the mortgage.
Mortgage life insurance automatically names the lender as the beneficiary. It may not be in the best financial interest of the beneficiary to have the mortgage paid off. What if, for example, the insurance proceeds could be placed in an investment which would earn more interest than what is being paid out in mortgage interest? What if there are more financially-pressing needs than paying off the mortgage? A level term policy with a designated beneficiary puts the customer in control of the death benefits and the decision of whether or not to pay off the mortgage.
You can check level term prices from the most competitive insurers by visiting FindMeAPlan.com.
The subject of life insurance is depressing enough for most people without analyzing what it really is. After all, we all know what has to happen to collect on the policy. Enough said.
It didn't take brilliant marketing on the part of Virginia insurance companies to realize that you couldn't call it "death insurance." Too many negative connotations. Yet, that's what it really is. Nothing can insure you against death; you can only protect those who remain. The coverage pays upon death, not life.
Nearly everyone has some form of life insurance coverage and most people do not seem to mind purchasing it. Why would that be? For starters, if you keep the policy long enough, your beneficiary is guaranteed to collect from the insurance company in Virginia. The only exclusions in some states, like Virginia for example, are a two year incontestability and suicide clause. While most insurance coverages, like fire and auto, involve only a chance of loss, life insurance is a guaranteed payoff at some point.
Life insurance in Virginia is also inexpensive for most consumers. Prices are lower than they have ever been. Mortality tables have been revised as people live longer. Competition among life insurers is fierce and have driven prices, especially for term life, to very affordable prices for someone relatively young and healthy.
Virginia Life insurance coverage is one of the more affordable benefits that employers can give to their employees. Limited underwriting and low administration make this an attractive benefit.
Virginia Life insurance is for the benefit of our loved ones to help pay final expenses, pay off debts, and replace lost wages of a bread-winner.
With the understanding of the true purpose of this important coverage and the low prices in today's market, maybe you should shop plans and prices at FindMeAPlan.com.
When we purchase other types of insurance coverage, such as auto or homeowners insurance, we base the amount of coverage on the value of the item being protected. How do we determine then the amount of Virginia life insurance that someone needs?
First of all, we need to determine the value of what is being protected. While no life insurance policy can insure we will live forever, it should more accurately be referred to as death insurance. Doesn't have a nice ring to it, does it? We will continue to call it life insurance then.
How do we calculate the value of someone's life? Think of it in this way. Let's imagine that you are a money machine. Every payday the machine produces a paycheck. What if the machine broke down all of a sudden and could not be repaired? Where would the future income for mortgage payments, raising children, college educations, car payments, etc. come from? We are all money machines and there can be no assurance that one day the machine might break down prematurely. While nothing can replace a human being or the other true values of life, insurance can be used to replace the broken machine. The proper amount of coverage can take care of all of the current and future needs just as if the machine had never broken.
Are you starting to get the picture that Virginia life insurance is mainly a replacement of future income? While there are many ways to calculate the amount of life insurance needed, the proper amount would take care of all of the future expenses and goals had we lived.
While everyone's situation is different, here are some general questions to ask yourself and guidelines to follow:
- Are others dependent upon my income such as a spouse or children? - Do I have current debts such as a mortgage, credit cards or other loans that would need to be settled? - Do I have children that are likely to attend college and had I planned to fund their education? - Do I own a business that would suffer or close at my death without the funds to hire my replacement?
If you added together the future income that we planned to make along with the other expenses, the figures could be staggering. The minimum amount of coverage for someone answering yes to the questions above would be 10 times their annual income. Of course, the amount of coverage can be reduced by the amount of funds already put away in savings to take care of these needs. The amount can also be reduced as these needs are reduced over time. The bottom line is that our needs for Virginia life insurance change constantly and should be reviewed often.
The discussion of this issue requires that we first of all analyze the purpose of Virginia life insurance. As morbid as it is, life insurance only pays off at death. All forms of insurance are a "necessary evil" in order to repair or replace something of value such as a car, home, lost wages, etc. If we knew that we would never have any form of loss, we would not waste money on insurance. There must be a loss in order for any type of coverage to pay. Coverage is purchased to restore a loss, not to make a profit. The odds are always in favor of the insurance company, otherwise, insurance would not exist. We sometimes begrudge the insurance companies of the odds being in their favor, including Genworth and Metlife, but we are happy that our losses are few and far between.
It goes without saying that the loss of a child would be devastating and heart breaking. There is no amount of insurance money that can replace the value of a child. It is hard to set the emotions aside when it comes to your children, however, it is those same emotions that cause people to make ill-advised purchases. Virginia life insurance has a primary purpose of replacing the lost income of a bread winner. Does a child bring in any income? Generally not, conversely a child uses income. Any of us with children know how expensive it is to raise them. We gladly bear those expenses, but monetarily speaking, children are an expense. Therefore, in most cases, children need little or no coverage.
There are a few instances whereby life insurance in Virginia may be necessary for a child:
- Final expenses - Funerals can be expensive and there may not be sufficient cash assets to fund a unexpected funeral. A small Virginia life insurance policy for a child could be the solution at a minimal premium.
- Future insurability - Future health problems could prevent someone from being able to purchase life insurance in Virginia after reaching adulthood. There are merits to this, however, the amount of insurance that someone may eventually need as an adult is so great compared to that of a child that it would be hard to justify the cost of carrying a large policy for all of the years it was not needed.
- The younger you are, the less it costs - While this is true, life insurance costs have decreased so dramatically over the last 10 years or so, there is very little difference in cost between a one year old and a twenty-one year old.
- Cash Accumulation - Many thoughtful parents and grandparents have invested in life insurance to provide funds for their children and grandchildren for college education or just as a cash gift. As thoughtful as this may be, every Virginia life insurance policy has fixed costs embedded to pay for the coverage itself and cover the administration costs of the policy. A better alternative may be to establish a college fund such as a 529 Plan or Coverdell account.
If you determine that the purchase of insurance for a child is important to you, ask your insurance company or agent if the child can be added to your own policy as a rider. You can generally cover as many children as you have for one low price. The children's rider may also have conversion privileges which guarantees future insurability.
Most insurance companies in Virginia, including Prudential and TransAmerica, sell both term and permanent insurance coverage. Term life is "pure protection" without any savings element or cash value features. It provides a death benefit only for a certain period of time. Permanent Virginia life insurance coverage, also known as whole life or universal life, provides coverage for a lifetime and accumulates cash values. The cash value can be used as a loan or surrender value to supplement retirement or other financial goals. So which type should you purchase? Let's look at some features of each type to help you decide.
Consider purchasing Virginia term life insurance if:
* You want the most protection for the least amount of premium. * You plan to save money with savings plans other than life insurance policies. * Your need for the protection is only temporary such as covering a mortgage or other debts. * If you plan to get rid of most of your Virginia life insurance coverage by retirement age.
Consider buying Virginia permanent life insurance if:
* You have the financial means to afford the proper amount of protection. * You find it difficult to save money on your own and plan to use your policy as a primary savings vehicle. * You feel a need to have some form of life insurance for your entire lifetime.
Some people feel as though Virginia term life insurance is like "renting" your life insurance and could be a waste of money should the term expire and coverage ends. The counter argument to that assertion would be that the Virginia term life insurance would likely cost much less leaving money left over to be invested elsewhere. There will always be a debate, but the important thing is to be informed and choose the right coverage for your situation.
Mark is an independent agent with nearly 30 years of insurance and financial services experience. For more information about affordable life insurance visit his site atFindMeAPlan
I am sure that most people will agree that Life Insurance is very important. We all love our families and we really do want to protect them in the event of our death. Unfortunately, many of us tend to procrastinate when it comes to actually taking steps to purchase a policy.
It seems that a lot of folks have the idea, or have heard from others, that purchasing life insurance is a difficult process. It really is not a difficult process but you do need to make sure you are dealing with an honest agent and/or agency. You should feel comfortable about the person you have selected to guide you through the Virginia life insurance buying process. A good agent will take all necessary steps to ensure that you are getting the best possible life insurance policy, with a quality Virginia insurance company and at the lowest possible cost. Even if you choose to apply for life insurance online you should be able to review information about the agent and the agency through their website.
Whether you apply online, over the phone, or in person, the process is simple. Once you have provided basic information to the agent or on the web, quotes can be run and the Virginia life insurance plan which best fits your needs can and will be found. Basic information includes: height, weight, sex, smoker or nonsmoker, any current or past medical conditions and any medications.
Now you are ready to complete the application for the Virginia life insurance policy. This is a relatively easy process and the agent can be of great assistance with this. Be sure to review all entries made on the application and sign all the signature pages. Premiums generally are made monthly by EFT (Electronic Funds Transfer) and no premiums will be deducted from your account until the policy has been placed in force. Once the application has been approved the agent will call you to advise that your EFT will be forthcoming. This process eliminates any surprises and none of us likes surprises when it comes to our finances.
Other than securing the application, the only other matter that needs to be addressed is medical information necessary for the Virginia insurance company to approve your application. The agent will call a medical service company and they in turn will call you so you can schedule an appointment with a technician right in the privacy of your home. You do not have to visit a Doctors office. Once this appointment has been made and the medical work completed, the medical service company will send the results directly to the Virginia insurance company for underwriting review. In many cases the Insurance Company will also request a copy of your MIB (Medical Information Bureau) report. This similar to a credit report. The MIB report simply contains a record of all Doctor visits, medications and so forth.
A lot of folks shy away from applying for life insurance in Virginia if they have had medical problems or because they feel that they are too old. Please don't let any of these concerns keep you from checking into the possibility of purchasing Virginia life insurance because today there are numerous programs available and there is probably something out there that will meet your needs.
If you are one of many who would prefer not to have any medical work performed in order to purchase life insurance in Virginia, there are several companies (Genworth, Metlife, Prudential, TransAmerica) who offer nonmedical life insurance policies. These Virginia life insurance policies are every bit as secure as a policy where you had medical work performed by a medical service company but, the premiums do run higher.
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