Long-Term Care Insurance and Its Sources

Introduction

Insurance is a promise of indemnity for specific future losses in exchange for periodic payments (premiums). There are several covers that insurance companies offer to their clients. Among them is long-term care insurance which is provided at the expense of the cost of long-term care beyond predestined time. Young people normally buy such covers due to the risks of illness and accidents. Under such cover, the insurance company will meet long-term care expenses up to a pre-determined extend in case of the occurrence of the specified loss.

Long-livers usually seek such cover because it is likely they will require long-term health care (Jacqueline L. A. 2008). Long term care insurance premiums vary in accordance with age. Younger people pay fewer premiums. Generally, most of the people buying long term care insurance are above age 55. In my argument, I will have to research the financial stability and ratings of various long-term care insurance providers.

Identification of sources of long-term care insurance

The first source of long-term care insurance is the Northwestern mutual life insurance company which is among the biggest insurance companies that offer a wide range of insurance products such as disability cover and annuities for retiring individuals. It also deals with trust and brokerage services. It specializes in long-term care insurance. John Hancock Long Term Care Insurance Company is another provider which is deemed to be Frontier Company in the long term care insurance field and was one of the pioneers to offer this line of cover.

MedAmerica insurance company is another insurance provider that was established two decades ago. It specializes in long-term care insurance and is among the companies that offer tailored products that are easy to be understood by common people. It has penetrated the market through its innovativeness in products and its financial soundness.

Genworth Long Term Care Insurance Company has been in the insurance field for the past few decades and offers products such as lifestyle protection, investment products, total living coverage, and long-term care insurance. Finally, Prudential Long Term Care Insurance Company specializes in long-term care insurance and offers a range of options such as adult day-care services, recovery period benefits, nursing home services, home-care services, Respite care, and home assistance service.

Selecting the best source of long term care insurance provider

Long term care insurance costs vary greatly depending on the age of individual and individual company’s rating policies. Older individuals pay more premiums than younger ones. The same policy may sell at different rates in different companies depending on the goodwill of the company and its financial soundness. Long term care insurance may be sold directly to individuals or through an employer group or other organization. (Lucy H, 2011).

Before you buy an insurance policy investigate the financial performance of the insurance company and its commitment to the market. Therefore you should look for ratings from insurance services, such as AM Best, Moody’s, or Standard and Poors. An insurance company ought to be rated in one of the top two categories by a minimum of two services and have no low ratings (Lawrence J. G. et al, 2010).

Basing on the year 2011 ratings by AM Best Company, Moody’s Investors Service, and Standard & Poor’s, I will seek cover with the prudential insurance company because of its overall superior performance in the market and its ability to meet clients’ commitments (Ronald A, Ronald J. A. & Jacqueline L. A. 1999). My future long-term needs total $41, 016, 210.35. i will need $139525.893 per year or I can set aside a lump sum of $ 3,332,896.42.

Conclusion

In conclusion, I would suggest younger people going for Prudential Long Term Care Insurance Company because of its effectiveness and efficiency in insurance services.

References

Jacqueline, L. A. (2008). Inheritance in contemporary America: The social dimensions of giving across generations. Texas: JHU Press.

Lawrence, J. G, Michael D. J., & Randall S. B. (2010). Personal financial planning (12th Edit). Cengage: Cengage Learning.

Lucy, H. (2011). How to find business information: A guide for business people, investors, and researchers. New York City: ABC-CLIO.

Ronald, A., Ronald J. A., & Jacqueline L. A. (1999). Who will care for us? Aging and long-term care in a multicultural America. NYU Press.