1/22/2018

You never thought you’d see “actuaries” and “wild” in the same phrase, did you? You’re welcome! The Wall Street Journal recently reported, on what we told about back in June 2017, long term care insurance (LTCi) rates are skyrocketing due to (wild?) actuarial miscalculations.

Actuarial miscalculations:

1. How long people would live and how long their claims would last
2. Home healthcare costs were expected to be much less than an assisted living facility (ALF) and stays at ALF’s woefully underestimated
3. Actuaries overestimated how many people would cancel policies. People who bought these policies are planners: they haven’t canceled.
4. Interest rates were assumed to stay in the 7-8 % range. Instead rates decreased significantly.

Now, before you go cancel your LTCi policies or not search for a LTC solution, take heart! There are things you can do to control costs including fine-tuning your existing policy’s benefits and explore hybrid products that provide LTC benefit but limit (or not allow) price increases. We’re happy to help you, your parents, your kids, family members and friends to review LTC options. Call us for a consultation!