Realizing the Potential of Private Long Term Care Insurance

The following is excerpted from Realizing the Potential of Private Long Term Care Insurance, American Council of Life Insurance, April, 1998.

Having largely invented the culture of youth during the 1960s, many baby boomers are more concerned with sustaining their youth and vitality than thinking about long term care. After all, who wants to project 30 years into the future? Unfortunately, the future is the present sooner than we think.

Now is the time for baby boomers to face the risk of needing long term care and to recognize that:

• Federal and state programs will pay only a limited amount for this care
• Unplanned long term care expenditures will seriously affect financial security
• Long term care insurance is an essential part of retirement planning
• There is value in purchasing long term care insurance at a younger age when premiums are less expensive

As life expectancy—and the risk of disability—increases, retirement is becoming a less predictable stage of life. An unanticipated nursing home stay can deplete hard-earned savings and threaten a family’s financial future. At the same time, the 21st Century could see the erosion of the social safety net for aging baby boomers.

For most Americans, private long term care insurance is affordable, especially if purchased at an early age. And with the insurance industry offering innovative products, it is not surprising that a small number of baby boomers have already purchased long term care insurance. Hopefully, more will follow.