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I Plan on Retiring in Another State. How Does That Impact Long-Term Care Planning?

Quick Answer

You determine the benefit levels when you apply for Long-Term Care Insurance. However, the costs of long-term health care services vary nationwide. If you know you will be moving, does it impact planning? The answer is yes.
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Detailed Answer

The costs of long-term health care vary, in some cases dramatically, depending on where you live. You usually design your Long-Term Care Insurance policy based on the current and future costs of long-term health care services where you live.

However, if you know that you will be moving, will that change how you should plan? Should you delay obtaining coverage until you move? If you do apply for coverage, should you design your benefits differently?

The LTC NEWS Cost of Care Calculator is a comprehensive source of current and future costs based on your location. It is a vital part of your planning when you start the application process for Long-Term Care Insurance.

Whatever you do - do not delay in getting coverage. Long-Term Care Insurance is medically underwritten and priced, in part, by your age and health. Delaying will cost you money and even make it more challenging - or in some cases impossible - to obtain coverage. Most people purchase Long-Term Care Insurance in their 50s. 

LTC Insurance Works Nationwide

While your policy is good anywhere in the United States and U.S. territories (and some companies have some international coverage as well), you select the benefit levels when you apply.

If you will be moving in the future, either because of your upcoming career change, retirement, or following your family, you should design your Long-Term Care Insurance policy based on the costs of care where you will be living in the future.

Keep in mind; however, you might need your benefits before you move. If your future relocation is many years from now, you might want to think about how you design your plan. Your decision depends on your current age, health, where you live now, and where you are moving to in the future.

Partnership Reciprocity

If you are getting a Partnership Long-Term Care policy, see if the state you are moving to will reciprocate. The state page on the LTC NEWS Cost of Care Calculator will provide this information and any additional information - like state tax incentives. 

Benefit Selection Depends on Cost of Care

If you live in a state where the cost of care is high and are moving to a lower cost state, you can purchase smaller benefits and save premium - or just enjoy more benefits that will last longer in your new location.

However, if you live in a lower cost state and plan on moving to a state where the cost of care is more expensive, be sure to get enough benefits to cover the much higher costs of your future care.

Policy design is an essential part of long-term care planning. Be sure to seek the help of an experienced Long-Term Care Insurance specialist when shopping and designing your benefits.

Keep in mind that most Long-Term Care Insurance policies are a 'pool of money' instead of a benefit period based on time. If your agent talks about 'three years of coverage,' it usually doesn't mean that. Once you start receiving benefits, if you don't use the maximum available each day or each month, you don't lose the benefits - they stay in your benefit account and grow with inflation (if you have inflation benefits in your policy). Since most Long-Term Care Insurance claims start with in-home care, you often will not use the maximum available. 

Be sure your specialist understands the cost of care services nationwide and has claims experience. If they have this experience, they will be better prepared to make the proper recommendations for you to consider. 

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  • Strong understanding of underwriting, policy design, and claims experience
  • Represents all or most of all the leading insurance companies
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