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Life Insurance and Long Term Care Insurance may be topics that we don't like to think about, but they are very important subjects. You work hard to achieve your goals - who wants to leave a loved one alone to pick up the pieces if things go awry? Time spent now, understanding the value and benefits these powerful programs can offer, may save a lot of heartache at a later time.
Life Insurance is a contract between a policyholder and an insurance company. The policyholder pays regular premiums to the insurance company in exchange for a lump-sum payment to beneficiaries in the event of a claim.
There are two basic forms of life insurance available - term and permanent life insurance. Term Life Insurance is set for a predetermined period, whereas permanent life insurance can provide coverage until death.
Life insurance policies can also be tailored to suit your requirements. Provision can be arranged for both natural and accidental death, as well as, injury or illness.
The beneficiary of a life insurance policy must file a claim - death benefits are not paid out automatically. The claim will require the completion of paperwork and a certified copy of the death certificate before being processed.
While there is no formal time frame during which an insurance company must pay, settlement usually occurs within 1 to 2 months. Costly interest charges imposed on insurance companies for delayed payments ensure delays are uncommon.
Life insurance provides peace of mind and a blanket of financial security for those left behind. There is no limit to how the funds can be used. They may be applied to paying down loans or to assist with day-to-day expenses for loved ones, taking away the worry of debt during their time of grieving.
Another way a life insurance policy can be used is to assist in paying applicable tax bills when passing a family business on to the next generation. It can also be used to help pay for a college education and many other reasons.
Long Term Care Insurance provides coverage for nursing home care or home health care for those aged over 65. It is also available to individuals below this age if they have a chronic or disabling condition that requires constant care.
It generally covers the costs of services that are not typically included in regular health insurance. Premiums can vary and are dependent upon things like the length of time care is required and how great your needs are.
Long Term Care Insurance is generally activated once you are unable to manage two or more activities of daily living on your own. An illness resulting in loss of intellectual function, such as dementia is also a cause for activation.
Once a claim is made, the insurer will send a representative, most likely a nurse, to assess your needs. After this is completed, the insurance company will provide a Plan of Care, which will provide details of what services will be provided, as well as what benefits you are eligible for.
The majority of people purchase long term care insurance during their 50s and early 60s. It is important to note that you may not qualify for this type of insurance if you have a pre-existing condition. Policy providers will also have a cutoff age, after which approval for the policy may not be given.
Costs can vary greatly and are dependent upon a number of things including the length of time care is required and how great your needs are. Keep in mind that premiums may increase the longer you leave it, or an offer of cover may not be provided after a certain age.
The above provides a brief overview. Sorting through the options for life insurance and long term care insurance can be quite daunting. Don't try to navigate this difficult process alone. Talk to one of our financial professionals today - they will help you review any and all options available by providing a no cost, no obligation analysis and quote.