It can be expensive, and some think it's a needless expense. The exclusion period can seem endless. For those who have bitten the bullet, it can be a blessing during a catastrophic time.
Many American Baby Boomers, already confronting a difficult economic environment, are ill-prepared for the negative impacts of a long-term care event and have ignored the lessons learned through the experiences of their parents. Baby Boomers recognize the family’s financial and emotional burden in the face of a long-term care event and they highly value what long term care insurance can do to alleviate those burdens, but haven’t taken the necessary action to secure this coverage, according to a major new study.
“This study explored the influence a parents’ long-term care experience can have on their Boomer children. Boomers overwhelmingly say they learned the consequences of being unprepared, however very few currently have long-term care insurance. Even though Baby Boomers face a more than seven in ten chance* that they will have some long-term care needs later in life, many haven’t connected the risk to their own personal situation,” said Mathew Greenwald, Greenwald & Associates.
“The study revealed that Boomer’s personal experiences have motivated a growing number to take renewed stock of their financial decisions, including their long-term care coverage. Even further, Boomer’s voiced an inclination to buy this coverage, but on the whole have not yet purchased it, creating an interesting disconnect,” said Mike Gallo, senior vice president in charge of Long Term Care, New York Life.
Boomers Place High Value On Insurance Coverage
The survey revealed a strong recognition among Baby Boomers of the benefits of long-term care insurance with the top financial and emotional benefits of coverage identified as follows: helping protect family from paying, 87%; providing peace of mind, 85%; ensuring retirement savings remains intact, 84%; and helping with the ability to leave an inheritance, 70%
Of those Baby Boomers whose parents had long-term care insurance coverage in place and used it, 72% said it was a good value. The Boomers whose parents had long-term care insurance felt the key benefits were:
- Lessening the family’s financial contribution to care, 84%
- Lessening the time for care by family members, 77%
- Increasing the quality of care, 76%
- Preserving the parents’ nest egg, 70%
- Helping Boomers focus on their own financial goals, 61%
For those surveyed whose parents needed long-term care, but did not have long-term care insurance coverage in place, 71% believe that coverage would have provided the family with peace of mind and 63% believed it would have increased the quality of care. Four in ten concede that it would have been easier for their parents to receive the care they needed if they had had long-term care insurance.
The survey showed for those without coverage the negative impact was felt by both the parent and the Baby Boomer. The strongest negative impact reported on the parent was emotional well-being, savings and ability to leave an estate. The greatest negative repercussions on Boomers were their quality of life and emotional health.
Please visit New York Life’s Web site at www.newyorklife.com for more information.
* Source: The 2010 Sourcebook for Long-Term Care Insurance. 2010, by Milliman.