Understanding long-term care insurance

LOS ANGELES You never know when you might need long-term personal care, which can be very expensive. Beverly Witt went to the hospital for foot surgery and nearly lost her life.

"I came home that day and a few days later I had these holes in my foot and I didn't know what they were," said Witt. "It turned out to be two staph infections on one foot and I almost died."

But Witt survived and now needs round-the-clock care. Fortunately she has long-term care insurance to pay for the help. She didn't realize she could collect on the policy right away and was using her savings to pay for the expensive care.

"It is hard to understand. It took awhile for me to understand how it works," said Witt.

Chartered Life CFP Brian Gilder says it's not uncommon for those who buy long-term care policies to not understand the benefits and when to file a claim.

"God forbid you need it. It doesn't mean you are completely sick and in a nursing home," said Gilder. "As you can see here in this situation she was getting better, but just needed help with the activities of daily living."

So just like Witt it's easy to make mistakes with your policy. Don't let it happen to you or someone in your family.

  • Let your family know you have a long-term care policy
  • Review the benefits regularly
  • Know the waiting period and how long the policy will pay
  • When filing for benefits fill out the paperwork completely and correctly
If you are buying long-term care insurance Gilder says you should budget for the type of policy you can afford. Also, make sure there is an inflation rider to cover rising costs. And get lifetime benefits.

"I'd rather have a lower daily amount of insurance. And I want the lifetime benefits," said Gilder.

Witt says don't let the expense stop you.

"If you have to beg, borrow, or steal get it because you do not know what's going to happen to you," said Witt.

Although long-term care insurance can be expensive, the younger you are when you buy it the cheaper it is. And, unless you can afford it, there is no need to buy the "Rolls Royce" of policies.

Remember, you never know when you might need it, so some insurance is better than none.

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