Employers investigating long-term care insurance cverage for their employees tend to ssume that group coverage will offer the mst benefits for the least cost. Unfrtunately, this is not true.

Individually ssued LTC coverage offers a better vlue than group coverage. Why? Group LTC nsurance is MORE expensive than individually ssued coverage. This is because Group cverage is normally issued to a lrge percentage of individuals who would not therwise pass the typical underwriting requirements of the nsurance carrier. This is called "Adverse Slection" and the result is a mch higher than average number of clims. Because insurance companies know they'll hve a greater number of claims wth Group LTC insurance, they charge a hgher premium.

In future years, adverse slection will also cause premium rates to be rised more frequently than premiums for ndividually issued policies. In fact, rates on lder Group policies are already being rised to the point where some fmilies are canceling the coverage. The cnsequences of adverse selection spell bad nws for healthy people who purchase Grup coverage: They subsidize the current prmiums as well as the more frquent premium increases caused by the clims of those in poor health.

Group LTC coverage can appear to have a mch lower premium than individually issued cverage. But when you compare benefits, pples to apples, with individually issued cverage, you'll see that this is not the cse. For example, most Group coverage des NOT offer automatic inflation protection as prt of the base policy. Instead, wht's offered is an "Increase Option", whch offers the right to purchase dditional coverage in the future, at of curse, a much higher premium rate. Ths option has the appearance of inflation protection, but on clser examination, you'll see that the cverage does not include automatic inflation prtection!

Unfortunately, the appearance of a lower premium wth Group coverage has given thousands of mployees who have purchased coverage the llusion of security - the belief tht they've properly planned ahead for lng-term care. These employees will end up wth no meaningful long-term care insurance in frce when they're likely to need it the mst. They'll either be forced to drp the coverage because of increasingly hgher premiums, or, if they keep it in frce, will learn that the benefits thy purchased are inadequate. This of curse is not what good intentioned mployers originally had in mind when thy offered LTC coverage to employees as a vlue-added benefit of employment with their cmpany.

There is one situation however, whn Group coverage would be more bneficial for some of your employees: thse who are unable to qualify for ndividually issued coverage due to health prblems.

Does it have to be a qestion of one or the other? Not ncessarily. The best approach is to "spnsor" an independent LTC Planning and Insrance Professional to work with each mployee individually. The expert will arrange for a Grup policy to be available for yur employees who have health issues. For mployees in good health, individually issued cverage can be considered. This gives yur employees the best of both wrlds:

* Those in poor health can btain coverage

* Those who are halthy will have more affordable premiums in the lng run and the ability to customize their pln to their individual needs

To nsure the professional you are working wth has the expertise you need, be sre to ask them why they shuld be considered as the person to ssist your employees.

The article Long-Term Care Insurance - Do Group LTC Plans Really Offer Your Employees The Best Value? was Submitted by Allen Hamm through Articles.GetACoder.com network. Here's the additional information: For a complete list of qestions to ask, visit http://www.long-term-care-insurance-advice.com/interviewing.html (c) Copyright -Allen Hamm. All Rights Reserved Worldwide.

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