Reduce the emotional and financial strain of caring for loved ones with coverage that pays for more advanced care in old age
ATLANTA, Jan. 29, 2015 /PRNewswire/ - Incorporating long-term care insurance into your retirement plan now can help protect you later in life if you're no longer capable of living independently, according to Atlantic Trust, the U.S. private wealth management division of CIBC (NYSE: CM) (TSX: CM).
Unlike medical insurance, which typically covers doctor visits and hospital stays, long-term care insurance is designed to provide coverage for a range of services at home, in community settings, assisted-living facilities and nursing homes. The costs associated with this kind of care can be significant. According to a 2011 MetLife survey, the average cost for a private room in a nursing home in the U.S. is $239 a day, or $87,235 annually.
Long-term care coverage is triggered when the insured begins to have trouble performing some of the basic activities associated with daily living, such as dressing, bathing or eating. Usually, there is a period (called an elimination period) that follows, where the policy will not pay any expenses. After the elimination period ends, the policy will begin paying for associated living expenses up to the amount covered in the policy. Policies with a zero elimination period are available as well, but cost more.
"Deciding when or if to buy long-term care insurance is an individual decision," explains Paulina Mejia, managing director and wealth strategist at Atlantic Trust in New York. "It's one way of reducing the emotional and financial strain of caring for loved ones, which is why it should be considered when creating a retirement plan."
Generally, it is better to buy coverage at a younger age, when premiums tend to be lower and will remain unchanged even if the buyer's health declines, she says, adding that there are some limitations. Premiums will be determined based on factors like medical history, health status and location, and some pre-existing conditions may prevent a person from obtaining coverage at all.
How much coverage to buy will depend on where the insured is living when care begins, how much the insured can afford to pay out of pocket and how much care is needed. Consideration should also be given to the insurance provider, she says. Those interested in buying long-term care should choose a company that is financially strong and has a long track record in selling this type of insurance.
Atlantic Trust provides resources online to those interested in learning more about long-term care and other retirement planning considerations. Visit the Online Resource Center, or read "Long-Term Care Insurance: Planning for the Unknown" for more information, or go to www.atlantictrust.com.
About Atlantic Trust
Atlantic Trust is one of the nation's leading private wealth management firms, offering integrated wealth management for high-net-worth individuals, families, foundations and endowments. The firm considers clients' financial, trust, estate planning and philanthropic needs in developing customized asset allocation and investment management strategies. Experienced professionals deliver a broad range of solutions, including proprietary investment offerings and a robust open architecture platform of traditional and alternative managers. Atlantic Trust operates in 12 full-service locations throughout the U.S. with $25.9 billion in assets under management (as of October 31, 2014). For more information, visit www.atlantictrust.com.
CIBC is a leading Canadian-based global financial institution. Through our Retail and Business Banking, Wealth Management and Wholesale Banking businesses, CIBC provides a full range of financial products to individual, small business, commercial, corporate and institutional clients in Canada and around the world. CIBC owns a 41 percent equity interest in American Century Investments®, a major U.S. asset management company, serving financial intermediaries, institutions and individuals, and acquired Atlantic Trust, a premier U.S. private wealth management firm, in January 2014. You can find other news releases and information about CIBC in our Media Centre on our corporate website at www.cibc.com.
SOURCE Atlantic Trust Private Wealth Management