Use it or Lose it

Use-it-or-lose-it long term care insurance is like auto insurance. You pay the premiums; if you need it you use it. If you never need it, you've still paid the insurance company and that money is gone for good—you lose it.

The premiums on use-it-or-lose-it insurance can go up. Some companies are boasting that they've never gone up in their premiums in 20 years. In the last 20 years, however, have 60 million baby boomers started to make claims? No. As baby boomers start to make claims, the premiums WILL go up.

Some use-it-or-lose-it companies offer a 10-pay plan. This would be very useful if you're in your wage-earning years so that when you retire, your policy is paid for. You would not have to pay for increasing premiums on a fixed retirement income.

I Bought it, it's Mine

You can purchase long-term care insurance that guarantees SOMEONE will receive the money. If YOU need it, then it's yours to use for long-term care needs. If you don't use it, you can pass the amount you don't use on to your heirs. The premiums are more expensive than for use-it-or-lose-it insurance, but the premium is set and does not go up. In fact you can even make a lump sum payment and be done with it!