“We’re proud of our efforts to educate both consumers and insurance professionals about the importance and value provided by long term care insurance,” declares Jesse Slome, director of the American Association for Long Term Care Insurance (AALTCI).    ”I am just one of the millions of baby boomers approaching retirement age, so the concept of tax deductibility especially intrigued.”  Slome initiated research that validated that an increased percentage of retirees deduct medical expenses which could include higher long term care insurance premiums.

“There are many reasons to look into long term care insurance protection as a way to ensure choice and options should a need for care arise,” Slome adds.  “But, the ability to deduct premiums can yield a tax deduction amounting to a couple thousands of dollars for an individual and much more for a couple.”

The ‘Buy Now – Deduct Later’ strategy involves purchasing long term care insurance during your working years when few are able to deduct individual medical expenses.  “After retirement, the percentage of individuals who itemize and deduct medical, health insurance and dental expenses grows significantly,” Slome points out.  Long term care insurance premiums can be included when calculating minimums needed to deduct these expenses.

Slome noted that the tax strategy published by the trade group had resulted in widespread media coverage.  “We’ve seen the item appear on Yahoo’s Finance page and Reuters news service,” he notes.  “We’ve seen it be used by several hundred print and broadcast media outlets across the country reaching millions of Americans.”

To learn more about long term care insurance tax deductions or for long term care insurance cost comparisons call the American Association for Long Term Care Insurance at (818) 597-3227 or visit the Association’s website at www.aaltci.org.

Consumer awareness efforts undertaken by the organization are made possible by member support.  The Association conducts independent research and publishes the Long term Care Insurance Sourcebook a compendium of long term care insurance facts, figures and data.

The post Long Term Care Insurance Association Makes National News With Tax Tip appeared first on American Association for Long Term Care Insurance.

2013 long term care insurance sales reported by AALTCI

Los Angeles; August 24, 2013 – Simplistic reports of data regarding long term care insurance policy sales result in a misunderstanding of market trends says the director of the American Association for Long-Term Care Insurance.

“During the first half of 2013, nearly 100,000 individuals purchased traditional long term care insurance policies and tens of thousands purchased life insurance and annuity products that provide long term care benefits,” declares Jesse Slome, executive director of the national long term care insurance industry trade group.  Slome was responding to questions by executives who market long term care insurance following a report that industry sales had declined 20 percent during the second quarter of 2013.

“Several long term care insurance carriers are reporting sales increases of 20 percent or more, and no one cites that,” Slome shared with the group.  “Others experienced sales growth of between 10 and 20 percent.  Overall sales were down due to several factors that impacted the first half of the year.”  Among those, Slome noted the failure of California’s Department of Insurance to approve newer policy filings had impacted sales.  “When the largest state in the nation has few options available, sales are going to be impacted.”

The national long term care insurance expert pointed to the continuing trend among insurance companies to be more selective in terms of accepting applicants.  “The knowledge gained over the past 20 years helps insurers understand long term health risks and to keep policy costs as low as possible which is what consumers want.  As a result, they will reject more applicants with existing health issues,” Slome explains.  “That reduces the number of overall policies sold.”

“Long term care is a universal issue facing Americans who are now living longer lives than ever but long term care insurance is not the universal solution,” Slome stated to the executives.  “There is a very defined market for this product but that is limited to those who can afford the premiums as well as meet the health qualifications when they apply.”

“Those who advocate a new national long term care insurance program as part of Medicare have yet to make a proposal that has any semblance of reality,” Slome concluded.  “We don’t see the American public or politicians for that matter ready at this point to add a new health care-related mandate or increase taxes, which leave families only three options; turn family members into caregivers, pay for care or have insurance to pay some of the cost of care.”

For additional information or to request long term care insurance costs and information connect with a designated long term care insurance specialist who is a member of the Association by calling the organization at 818-597-3227 or visiting their website.

The post 2013 Long Term Care Insurance Sales Trends Interpreted appeared first on American Association for Long Term Care Insurance.

According to the 2013 National Long-Term Care Insurance Price Index released today by the American Association for Long-Term Care Insurance prices for long-term care insurance policies are higher as a result of increasing care costs and significantly lower interest rates that factor heavily into policy prices.   In 2012, the organization noted identical coverage cost $1,720 annually.

“Persistent low interest rates and yields on fixed income investments continue to push costs for various insurance products higher,” explains Jesse Slome, AALTCI’s executive director. “Long term care insurance policy sales are up as consumers recognize the importance of planning and show greater acceptance of policy options that offer greater affordability.”

The Association analyzed costs for 12 leading insurers for single individuals and couples between ages 55 and 65.   Rates varied quite significantly for virtually identical policy benefits Slome reported.   “For a 55-year-old single policy applicant the highest priced policy cost 87 percent more than the comparable lowest priced policy,” Slome notes.  “For a couple both age 60, there was a 92 percent difference and no single insurance company always had the lowest price.”

Slome advocates a “Good, Better, Best Approach” to long term care insurance protection that offers greater flexibility and affordability.  “There is no one-size-fits-all policy choice that suits everyone,” Slome advises.   “Some protection is always better than none and coverage that does not include a costly inflation growth option is an affordable option,” Slome says.   According to the Association study, a couple where both spouses are age 60 will pay a total of $1,816 annually for $162,000 of coverage for each person.  “A good long-term care insurance option takes into account the future availability of savings, Social Security benefits and investment retirement income to supplement insurance coverage,” Slome explains.  “Increasing benefits are not an option that everyone today needs or wants to pay for.”

For the first time, the Association’s Price Index examined rates from insurers offering a Future Purchase Option (FPO) that allows the applicant to lock in their health insurability and add to their coverage periodically.  “A better approach is selecting a starting point for benefits that can be added to later where underwriting won’t get in the way,” Slome advises.  “The FPO option adds about five percent to the cost but offers enormous value in terms of future flexibility.”   Not all insurers offer this option, he shares, and currently and the Association found a 40 percent price differential between the lowest and highest priced policies with this feature.

Historically, most long-term care insurance policies purchased by individuals have included the added option that increased benefits to keep pace with growing care costs.   “Five percent was established as the norm in the 1990s when double-digit inflation was a recent memory but much has changed over 20 years,” Slome explains.  “Today, a three percent yearly increase in benefits is considered the best option for those willing to pay the higher cost.”  A couple both age 60 will pay $3,725 yearly for coverage that grows to $329,000 for each when they reach age 85.  Comparable coverage cost $3,381 according to AALTCI’s 2012 Price Index, a 10 percent increase.

“The Good, Better, Best approach to long term care insurance planning makes enormous sense today,” Slome concludes.  “The timeworn one-and-done approach to long-term care insurance planning worked when buyers were in their late 60s and early 70s,” Slome concludes.  “With typical LTC insurance buyers now in their mid-50s, flexibility and the ability to change as personal and economic circumstances change is not just desired, it’s significantly more affordable.”

“There’s never been more interest in long-term care insurance as millions recognize the costs associated with living a long life,” states Larry Moore, Director of Marketing for American Independent Marketing, a leading national marketer that assisted the Association in compiling the Price Index information.   “With more options and ways to make protection affordable available today, long-term care insurance can be far more attractive than many people think.”

The complete 2013 Price Index will be published in the Association’s 2013 Long-Term Care Insurance Sourcebook.  For more information, visit the American Association for Long-Term Care Insurance’s website at www.aaltci.org or call (818) 597-3227

The post 2013 Long Term Care Insurance Price Index Published appeared first on American Association for Long Term Care Insurance.

“For taxable years beginning in 2013, the limitations have been increased,” explains Jesse Slome, executive director of the American Association for Long-Term Care Insurance (AALTCI), the industry’s trade association.  “Tax advantaged long term care insurance remains one of the few remaining significant tax-savings benefits especially meaningful for small business owners.”

The deductible limits under Section 213(d)(10) for eligible long-term care premiums includable in the term ‘medical care’ are based on the taxpayers attained age before the close of the taxable year.  For those age 40 or less, the maximum deduction is $360 an increase from the 2012 amount ($350).  The maximum amount that may be deducted by an individual who is more than age 70 is $4,550, an increase from $4,370 in the prior year.

“The federal government and a growing number of states are offering deductions and in some cases even credits to encourage individuals to plan for the eventual need of costly long-term care,” Slome explains.

According to the just released IRS Revenue Procedure 2012, the deductible limits range from a low of $360 to as much as $4,550 per individual.  “The deductions are especially meaningful at older ages when it is likely a couple will have lower income and potentially other medical expenses necessary to meet minimum thresholds,” Slome explains.  “That said, people must buy long-term care insurance when they can still health qualify.  Tax deductions are a meaningful added plus to the potential of not having to depend on family members or spend your retirement income for care.”

For calendar year 2013, the per-diem limitation under Section 7702B(d)(4) for periodic payments received under a qualified long-term care insurance contract is $320 (the 2012 limit was $310).

Established in 1998, the American Association for Long-Term Care Insurance is the national association focused on creating heighten consumer awareness regarding the importance of planning and serving insurance and financial professionals who provide long-term care financing solutions.  A complete explanation of long term care insurance tax deduction limits and rules for individuals and business owners can be found on the Association’s website.

The post 2013 Increased Tax Deduction Limits for LTC Insurance appeared first on American Association for Long Term Care Insurance.