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‘Dollars And Sense’ Category

  1. LTC Health Chassis

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    April 23, 2012 by Milton Jones

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    Okay, so you’ve become aware that your life’s savings is at risk in the game of Long Term Care.  You know about the “spend-down” rules before getting public financing. So how do you plan?  You could buy LTC insurance. In the landscape for Private Long Term Care Insurance, there are two major alternatives: •    The Health Insurance Chassis, and •    The Life Insurance Chassis. We will first explore the Health model.  Let’s say you’ve looked around and determined that $150 per day is about the realistic starting point for cost of Custodial Nursing Home care. Furthermore, assume you are a couple age 60 and 58 respectively. So what would you expect to pay for such coverage? It depends on a lot of variables. Some people will buy a two-year maximum benefit plan, while others insist on a lifetime benefit. The average nursing home stay is 30 months, but who’s average? Then there’s the matter of Inflation.  The government insists that everyone buying LTC insurance be offered Inflation Guard as an option. For example, 5 percent compound increase in benefits. I can tell you from experience that costs of care have more than doubled in the past 15 years. Mutual of …

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  2. Problems of An Aging Society

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    April 10, 2012 by Milton Jones

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    In my childhood, I recall people speaking fondly of living “to a ripe old age.” My own father lived to celebrate his 100th birthday. But old-age is not always a blessing. Longevity creates its own expensive problems, and many more of us are living much longer than in the past.

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  3. Problems of An Aging Society

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    April 10, 2012 by Milton Jones

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    In my childhood, I recall people speaking fondly of living “to a ripe old age.” My own father lived to celebrate his 100th birthday.  But old-age is not always a blessing.  Longevity creates its own expensive problems, and many more of us are living much longer than in the past. In times past, the elderly lived with their children. Today, we live in a society where most of us can look forward to years of custodial care in a nursing home.  Some of these places can be quite attractive, while others are places of squalor.  All are expensive. Long-Term Care is one of our most expensive problems. Many people incorrectly assume that Medicare covers most of this expense.  In fact, Medicare coverage usually provides only a limited number of days in Rehab or Skilled Nursing, and does not reach the more massive problem of “Custodial” care. The bulk of these expenses are borne by Medicaid grants, matched by funds at the State level. Private Long-Term Care insurance is a relatively new thing, having become a significant market segment only within the past 30 years or so. When people asked me about who buys this coverage, I would give the wry …

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  4. Disability Insurance, Part Two

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    March 26, 2012 by Milton Jones

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    In the last column, we discussed the risks of Premature Death, Old Age, and Disability. One of these three gremlins is sure to take away your earning power, sooner or later. The Insurance & Health Insurance Industry offers policies to protect against all three. Life Insurance pays best when you die before your time. You can get an annuity policy, or utilize certain types of life insurance policies to provide retirement benefits. Finally, some companies offer policies that provide disability income. From the Insurance Company’s viewpoint, disability is the toughest of the three to cover. When we think of disability, the stereotype is to visualize someone paralyzed and bound to a wheelchair. That extreme example is rela- tively easy to insure against, because it’s relatively black and white. But things like stress, fibromyalgia, or back pain are much more subjective. Stated differently, it’s sometimes hard to know whether it’s really disabling or just something to put up with. With disability income policies, the definition of disability clause is really critical. A typical definition goes something like this: total disability is deemed to exist when the insured person is unable, by reason of sickness or injury, to perform all the important …

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  5. Protecting Against Disability

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    March 15, 2012 by Milton Jones

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    It is sometimes said that the Insurance Business is divided between those who insure Property Values and those who insure Human Life Values. What do we mean when we say Human Life Values? Life & Health Agents are fond of saying that we protect against the risks associated with Premature Death, Disability, and Old Age. One of them is sure to get you! We can’t insure that these things won’t hap- pen, but we can arrange to replace some of the lost income. It’s really a matter of Time and Money. We trade our time for money, and live on the money until we run out of time, or lose our ability to work. Of the three risks mentioned, Disability is often the most economically devastating. It sounds cruel, but if you die your family can bury you and get on with their life. If you’re disabled, your paycheck has died but you are still a consumer. Chances of becoming disabled are about three times higher than for premature death. A leading cause of fore- closed homes is disability of the bread-win- ner. So how can insurance compensate for a dis- ability? Different types of coverage include: (1) Liability settlements …

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  6. Mail-order ​Insurance

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    February 13, 2012 by Milton Jones

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    “Buying insurance through the mail is only slightly less risky than getting a mail-order appendectomy,” my former mentor was fond of saying. Rex Alan Smith (R.I.P), a respected New York Life agent, was viewed as a true professional. Among other things, he taught me to take a dim view of the kind of insurance that was usually sold through the mail, and these days via the Internet. “It’s not that there isn’t some good insurance sold that way,” he would point out (clearing his throat with his characteristic harrumph). “It’s just that the average buyer can’t distinguish between the junk and the good stuff.” Many things have changed in the 40 years since I heard that, but the junk is still out there. And, of course, we have the Internet and the broadcast media. One of the most common stories goes like this: “If you are over 50, and have been denied insurance, you can qualify for this guaranteed coverage from Mutual of Tupelo for only pennies a day … ” A lot of funeral expense policies are sold this way. They are perfectly legitimate, but are often a poor value. A recent example I saw was a $10,000 final expense police for a …

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  7. Thinking about Tort Reform

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    January 20, 2012 by Milton Jones

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    Many people, me included, have been critical about controversial features of the Health Reform Act. Perhaps the most important flaw is what the law didn’t include. I refer, of course, to the business of Tort Reform. Why don’t we just say Legal Reform? “Tort” is a more specific word, so let’s define it: Tort — a wrongful act other than a breach of contract for which relief may be obtained in the form of damages or an injunction. Why is reform important, you ask? Maybe the following example will suffice. Try to relax and watch TV for a couple of hours and you’ll get to enjoy at least one commercial that sounds like this: If you took the drug Delusia, and are suffering from kidney failure, call the Law Firm of Eusta B. Hon- est. You may be eligible for compen- sation if you call before … Okay, so I made that one up. Pick the one you love to hate. There’s quite a list, including (allegedly) defective hip re- placement joints, faulty hernia repair mesh, bad side effects from drugs, etc, ad nauseam. “So who cares if someone sues the drug company and gets a big settlement,” you ask? …

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