John Hancock is the second largest life insurance and long term care insurance company in North America (LIMRA Market Report, 2004). John Hancock has excellent financial strength ratings with an “AAA” rating from Standard & Poors, an “Aa2” ratings from Moody’s, an “A++” rating from A.M. Best, and an “AA+” rating from Fitch (ratings as of 9/05). John Hancock issued their first long term care insurance policy in 1987 and currently has over 850,000 JH long term care insurance policyholders.
Long term care insurance has been in the news a lot in the past 10 years, thanks to Congress and recently enacted government programs. Congress first passed the Health Insurance Portability and Accountability Act (HIPPA) in 1996 which gave long term health insurance policy holders great federal tax advantages, depending on their age. Then, in 2001, long term care insurance became available to government employees and their employees. By the time 2005 rolled around the Government launched a campaign called “Own Your Future” which advocated investing in long term insurance. So, with all the talk about long term care health insurance, what is it and who needs it?
What is John Hancock Long Term Care Health Insurance? When Should I get it?
According to the John Hancock insurance company, long term care health insurance is first designed to protect you from losing your assets you worked your whole life for. Further purposes are to keep you independent, protect you from being a burden, help keep you off of Medicaid, give you tax advantages, and help you when Medicare won’t pay fully. It can also be an intricate part of estate planning.
John Hancock estimates that more than 13 million Americans are currently in need of long term care health insurance and of that 13 million, over 40% are working adults. What this means is that while long term health care is predominantly only thought of as being needed when you get older, it is often a good idea to purchase your long term policy while you are still working. The AARP states that best time to purchase a long term health plan is when you are middle aged. The reasoning behind this is that if you purchase long term health insurance when you are younger the premiums are significantly lower and you are more likely to be eligible for the program before health problems exclude you.
Women should especially look into getting long term care insurance on the chance they will need assisted living or nursing home help later on in life, as at least 75% of nursing home populations are women. Given that the average annual care in nursing homes is $75,000 (MetLife Mature Market Institute, 2006), providing for your care now can help you not be a burden to your heirs later on in life.
What are Some of the Benefits in John Hancock Long Term Care Insurance?
John Hancock long term care insurance has specific core benefits that are include in their long term care options. Other benefits are available, but at an additional cost. Core benefits are listed below.
1) Daily Benefits – this is the amount of money your policy will pay out each day. Most policies have anywhere from a $50 to $300 payout a day.
2) Benefit Period – this is the amount of years your policy will cover you for. John Hancock offers benefit periods in the amount of 2,3,4,5,7,10 years and a lifetime period. Most policy holders have between a 3-5 year benefit period.
3) Inflation Protection – this is an option for those who will be holding the policy for a longer amount of time and is designed to protect you from increases in the cost of living by giving you continuous inflation adjustments.
4) Elimination Period – the elimination period can be thought of as your deductible or the amount of time that you are responsible to pay for. Elimination periods run anywhere from 30 days to one year.
Other benefits and riders are available through John Hancock, but usually with a higher price tag. The additional benefits available to you differ depending upon your state of residence.
How Much Does John Hancock Long Term Care Insurance Cost?
The cost of a John Hancock long term care insurance policy varies depending on when you purchase the policy. The best time to purchase is when you are younger (middle aged or starting when you are in your 40’s) when your premium is lower. The cost also varies depending on the package you purchase, your health history, and your state of residence.
Most of John Hancock’s programs are comprehensive packages, meaning they cover home health care, nursing homes, assisted living, etc. (Watch out for the fine print with smaller insurance companies that are less well known and may not have true comprehensive coverage like John Hancock, Prudential, AIG, Allianz, New York Life, MassMutual, Genworth, and other large and financially strong long term care insurance companies).
In 2002 the average cost of long term care insurance for a 50 year old was $564 annually ($47/monthly), for a 65 year old it was $1337 annually ($111.42/monthly), for a 79 year old it was $5330 annually ($444.17/monthly). Note that discounts are available for many things including being married (or living with someone) and for having good health.
Is John Hancock Long Term Care Insurance Right for Me?
John Hancock insurance company may be a good choice for you to consider in choosing a long term care insurance policy but first you must consult with a qualified professional to decide if you need long term care insurance in the first place. It is often difficult to say who needs long term care insurance although some good rules of thumb can be used to guide you. The United Seniors Health Council says that you should only purchase long term care insurance if you assets are over $75,000 (not including your house and car) and you expect to have at least $25,000 annually when you retire. They also advise making sure you can comfortably handle premiums if they should go up in price.
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Long term care health insurance is necessary for many Americans who are looking to protect their assets and provide for themselves as they get older. It is important to make sure you can also afford to pay the premiums on long term care as you get older and to be careful to plan ahead and purchase long term care insurance before the premiums get too expensive or your health history precludes you from obtaining coverage.
Long term care insurance can be a great way to provide for your care as you get older and is worth a close look and serious consideration for all Americans. Use our free insurance quote finder at the top of the page to compare quotes from John Hancock and many other long term care insurance companies side by side!
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