One of the great perks about working for a big company is its employee benefits program, which is usually more bountiful than what you’d find at most small businesses. But one perk that may not be such a great deal is the employer-sponsored long-term care insurance plan.
That’s not to say that long-term care insurance isn’t a good idea. It might even be necessary. A 2010 study by Age Wave/Harris Interactive reports that more than 50% of survey respondents say their biggest fear in retirement is being a financial burden on their loved ones. As an example of what this burden could be, it costs about $74,000 annually to stay in a private nursing home, according to a study by Genworth Financial. And for a more thorough look at the cost of long-term care across the U.S., visit Genworth.com.
Long-term care seems to be a necessity, and not a luxury, but is it worth it to buy your long-term care from your employer?
The answer depends on a variety of factors, chief among them the size of your company. Typically, the larger the company, the better the deal you can get. That’s because large companies gain leverage by bringing more companies to the negotiating table.
But employer-sponsored long-term care plans can also come without some serious ammunition – features like inflation price protection, shorter benefits periods, and limited daily benefit payouts are not often associated with large-scale employer long-term care insurance plans.
It’s not all negative, however. Long-term care plans from bigger employers usually provide better underwriting terms and more favorable rules on pre-existing conditions.
With those pros and cons in mind, what’s the blueprint for buying long-term care insurance from your employer – big or small? Here are some moves to keep in mind:
Buying long-term care protection from your employer is no panacea, but it does have advantages, most notably lower costs. To be sure you’re getting the best deal, make sure your long-term care shopping campaign includes not just your employer’s offering, but any individual policies you can negotiate on your own.
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