When Premiums > Benefits

[banquo]

In about three years, the total amount my mother will have paid in premiums for her LTC ins. will exceed her Maximum Lifetime Benefit of about $131K. She doesn’t qualify for benefits yet. Am I correct in assuming she’ll have to continue paying the annual premium after that in order to maintain benefits, even though it’ll be a net loss for her in the long run?

Her policy is with Penn Treaty. She bought it in Florida, so I assume that state’s guaranty assn. will take over the policy when Penn’s liquidation is completed.

 

[yankee466]

First I would say to double check your math, as I doubt she bought it when she was 20......and then ask if her policy had an inflation rider, meaning the benefit grows every year. One reason Penn Treaty is no longer selling plans is that they didn't charge enough on their older policies, and had loose underwriting.

Else, your assumption on paying premiums until you go on benefit is generally a correct statement.

 

[Mr_Ed]

In about three years, the total amount my mother will have paid in premiums for her LTC ins. will exceed her Maximum Lifetime Benefit of about $131K. She doesn’t qualify for benefits yet. Am I correct in assuming she’ll have to continue paying the annual premium after that in order to maintain benefits, even though it’ll be a net loss for her in the long run?

Her policy is with Penn Treaty. She bought it in Florida, so I assume that state’s guaranty assn. will take over the policy when Penn’s liquidation is completed.

If your mom owns a Penn Treaty policy she probably bought it about 20 years ago. Let's assume she bought it 25 years ago. If she bought it 25 years ago, that would mean that her premium is about $5,000 per year.

If her premium is $5,000 per year she DEFINITELY has an inflation benefit rider on the policy. If she has an inflation benefit rider on the policy, then that would mean her benefits have grown to over $400,000 and will be over $520,000 of benefits within a few years.

Keep in mind that many of the Penn Treaty policies used very liberal benefit triggers. Penn Treaty used IADL's as well as ADL's to trigger a policy's benefits. If she is frail right now and needs assistance with any IADL's, she may qualify to receive benefits right now.

 

[Northeast Agent]

Biggest Health Insurer Failure Ever: Policyholders will have to pay $4 billion

Biggest Health Insurer Failure Ever: Policyholders will have to pay $4 billion

 

[ltcadviser]

Biggest Health Insurer Failure Ever: Policyholders will have to pay $4 billion

Biggest Health Insurer Failure Ever: Policyholders will have to pay $4 billion

Well, ......now I know why my Humana health insurance premium doubled from $1200 month to $2400 month

 

[pfg1]

Well, ......now I know why my Humana health insurance premium doubled from $1200 month to $2400 month

OUCH! We need a little 'getting rear ended' emoji for that one.

 

[yankee466]

Well, ......now I know why my Humana health insurance premium doubled from $1200 month to $2400 month

not only did they double it, but switched you to an HMO network that no one takes.l

 

[goillini52]

OUCH! We need a little 'getting rear ended' emoji for that one.

You mean like this...:bump:

 

[Mr_Ed]

You mean like this...:bump:

that emoji looks like joe biden.

 

[goillini52]

that emoji looks like joe biden.

Hahaha, that's Joe that's receiving. Gee, I wonder who that could be that's delivering?