Gabe is 58 years old and has been dependent on a cane for a couple of years.Gabe fears that he may need long term care services some day in the future.His net worth is $400,000 and he receives $50,000 per year in a pension.He considers himself to be in excellent health and has never had a serious health scare like a heart attack,stroke,or cancer.He eats lots of bran and exercises regularly.Which of the following policies would you recommend to Gabe?
A) Gabe needs a disability income policy.
B) Gabe should buy a long term care policy with a long elimination period,lifetime benefits,and a COLA.
C) Gabe should buy a long term care policy with a five-year limit,short elimination period without a COLA.
D) Gabe doesn't need disability insurance and probably can't qualify for long term care insurance.
E) Gabe can qualify for Medicaid if and when he needs long term care services.

Question

Quizplus · Accepted Answer

Given Gabe's age and dependence on a cane, it is likely that he may need long term care services in the future. As he already has a substantial net worth and pension income, buying a long term care policy with a long elimination period, lifetime benefits, and a COLA makes sense as it will protect his assets from being depleted in case of a long-term care need. A policy with a five-year limit or no COLA may not be sufficient to cover the expenses of a long-term care need. Moreover, since Gabe considers himself to be in excellent health, he can likely qualify for a long-term care policy at a reasonable premium. Medicaid should be considered as an option of last resort, as it has certain eligibility and asset requirements.

Gabe Is 58 Years Old and Has Been Dependent on a Cane