While Long Term Care insurance is a product that catches the eye of seniors, it is important to note that this is not just a product for retirees - it is coverage you should have if you are active, over 40, with substantial assets to protect, or a family to provide for. It is another tier in your insurance planning. You wouldn't dream of not insuring a house, or an expensive automobile or a boat - why then would you not protect your assets from a catastrophic event such as a debilitating automobile accident, a stroke, or other medical problem? The dollar costs associated with long term care are staggering; but when you consider that. according to the National Council on Aging, one in seven people now provide or manage care for a friend, relative, or spouse, the human cost is inestimatable.

Long term nursing care is the next emerging entitlements crisis. It is estimated by the General Accounting Office that nearly 40% of people age 65 alive today will need some form of home or skilled health care. If a person has income-producing assets of $500,000 or more, you may not need any long term care insurance; however, if you have an earned income that would be lost, the double edged sword of continual care needs and loss of income can be overwhelming. Government programs such as Medicaid pay only for minimal long term care. Medicare pays only for skilled care after a hospitalization, and then only if medically necessary, with no benefits payable for custodial care. With costs ranging from $80-120,000 a year and rising, the premium for this type of coverage is affordable, although not inexpensive. It is coverage that is becoming mandatory to own, particularly if you have sizeable assets to protect. Do you really want to depend on a government-funded nursing facility?

Long Term Care Insurance guarantees to pay for a sudden and unexpected expense which would seriously deplete or exhaust your financial resources. It is a critical tool for you to avoid catastrophic financial hardship on you or your family, providing you the flow of money to pay expenses incurred for the care you need, typically payable as a lump sum of money or as a daily benefit amount. Payment of benefits usually starts when your doctor certifies that you are functionally impaired, or unable to perform 'Activities of Daily Living' (ADL's) without continual assistance. These activities are:

• Ambulating - walking or managing a walker or wheel chair
• Bathing
• Continence
• Transferring - getting in and out of bed, or a chair
• Dressing
• Eating
• Toileting

Good contracts provide for benefits in the event you are unable to perform 2 or more of these functions. In addition, functional impairment is covered as well, which provides for coverage of biologically-based brain disorders, such as Alzheimer's Disease and Senility Dementia.

As a consumer, you are faced with a blizzard of choices. Here's what you need to know: the premium cost of a long term care policy depends on three factors: Your current age at issue, your current state of health, and where you live. After this, you can control your premium further by controlling such features as the benefit amount, the length of coverage, the elimination period, any inflation riders or return of premium provisions, etc. Buying your plan early helps a great deal - there is a tremendous difference, as there is in life insurance, between the premiums for a 50 year old and the same plan for a 70 year old. And, generally, once you have purchased a policy, your rate is set, unless your insurer decides that it needs to raise premiums for an entire class or group of policies. Using a strong, reputable insurer is always better protection.

The Health Insurance Association of America provides the following estimates for a policy with a $100 a day nursing home benefit, $50 a day home care, with a 29 day elimination period (the period of time when you will be expected to cover all costs related to a long term care stay) :

• Less than $900 a year at age 50
• Less than $1,850 a year at age 65
• Less than $5,900 a year at age 75 (based on data available from 1997-98)

These are estimates, and actual costs may vary widely, especially with regards to riders and other features.

Go to the next page for a complete description of benefits and features.

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