The type of Long Term Care Insurance Policy chosen, daily benefit amount to be paid, your age, number of years the policy will pay benefits, choice of inflation protection and the number of days after you qualify for the benefits before the company will start to pay benefits are factors which influence your Long Term Care Insurance Policy Premium. If you have a pre-existing condition, your premiums may be higher if some companies agree to insure you. All of the above factors influence your LTCI policy premium.

The costs of benefits you choose are calculated differently by different LTCI companies. The significant difference you see between premiums for similar benefits is the result of the above. To illustrate the above, a company may calculate the premium based on every $10 of the daily benefit you choose. If the company charged $95 for each $10 of daily benefit, the premium would be $950 per year for a daily benefit of $100. If the cost was $150 for a similar package of benefits, the annual premium would rise to $1,500 with another company.

Your LTCI premium is affected by the method and amount of inflation protection chosen. This nearly doubles the cost for those in their 40s and 50s not expecting to need care for several years. With age your probability of developing health conditions which make you ineligible to apply for new benefits increases but your ability to change LTCI policy diminishes as you age.

You may see an increase in your LTCI premiums over the years. A personal worksheet which explains the rate increases the company has had since 1990 is provided to you by your agent when you buy a LTCI policy. For rate increases for every company that sells go to the California Department of Insurance website. LTC insurance companies found it difficult to increase future premiums when California passed legislation in 2000.

When it became mandatory in 2006 for all companies filing for premium increases over a certain amount to offer a choice, policy holders got to choose between stop paying their premium and keep the benefits equal to the total amount of premiums already paid. The sum of premiums that has already been paid will finance only a small amount of care. If you were unable to pay because of a premium increase, you will not lose all your benefits.

By reducing some of the policy benefits you can negotiate with your company for lower premiums. If you have received premium increase notice or you need to lower your premium contact your local Health Insurance Counseling and Advocacy Program (HICAP) office.

Learn more about long term care insurance. Stop by Maria Smith’s site where you can find out all about long term care health insurance and what it can do for you.

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