Taxes and Finance

The Tax Attic with Jerry Coon — May 20, 2010

May 20, 2010 // 0 Comments

Final discussion on long-term care insurance I have a few final items to cover this week concerning long-term care insurance policies. Specifically, there are three areas I want to discuss. This week, I am using a quote Deb and I received from Genworth Life Insurance Company. First, instead of Deb and I buying individual policies, should we take the alternative of buying a joint policy? Second, should we buy a survivorship rider that will pay up all future premiums should Deb or I pass away? Third, should we buy a rider that will return our unused premiums if we die before making a claim? First, it does appear to be cheaper to buy a joint policy than Deb and I each buying individual policies. The joint policy annual premium for the quote was $2,415 for a total of 72 months of coverage. That compares to a total annual cost of $2,815 for individual Deb and Jerry policies that covers 36 months for each of us. On the joint policy, we do get a little more flexibility, because it doesn’t make any difference which one of us uses the 72 months. I could use two months, for example, and the other 70 months would be available for Deb, or vice versa. The minimum months of coverage on joint policies does appear to be 48 months of insurance coverage, while individual policies can be purchased for as short a period as 36 months. It might make sense for Deb and I to purchase a joint policy for 72 months rather than individual 36-month policies. Of course, that presumes we will never let the policy lapse. If we have two individual policies, we could let one lapse, mine for example, and keep Deb’s in force. We would not have this option available to us if we had just one policy. Dropping that policy would drop everything. It can’t be a snap decision to buy the joint policy. Second, the question becomes should we buy a rider that pays up all future premiums should Deb or I pass away? As part of this particular policy, and at no extra cost, should we pay in for 10 years without making a claim, and then Deb or I pass away, and […]