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Welcome ... to a powerful new way to calculate the economic impact on estate values with and without insurance.
New insights for financial planners and their clients are provided in an easily presented package! If you are an attorney, CPA, financial planner, financial planning firm, or involved with LTC financial planning in any form, we hope this site is educational. We believe this software will be invaluable to your practice and your firm. The entire purpose of the LTC Economic Impact Planning Model is to improve the ability of Planning Professionals and others in trusted advisor positions to help their clients and society at large make more informed, thoughtful decisions about the economic impact of long term care with and without the use of insurance. The model takes a number of key variables into account: Model FocusThe LTC Economic Impact Planning Model is designed to assist with the initial and primary decisions a client should address.
The LTC Economic Impact Planning Model helps you and your clients with the primary and most important decisions.Model FeaturesMultiple Client Scenarios ... in an instant!If you want to see the effect of simple inflation rather than compound inflation, make one change and a new scenario for the same client is created instantly. Do this with any variable to create as many scenarios as you want to analyze. Client Specific Reports
Advisor Information
Planning Assumptions and OptionsClient Profile
Insurance Assumptions - Standard Benefit Design - Automatic Premium Calculation
Custom Benefit Design Options
Advanced Planning OptionsThe advanced planning section gives the planner the option to include or exclude any of the variables in any of the client scenarios. The advanced planning scenarios include:
Rate of return that would have been available on the assets consumed to pay LTC cost and insurance premiums may be included in your projections.
Depending on individual circumstances, illiquid or other highly appreciated assets in down markets may have substantial liquidation costs. Adequate insurance may prevent the need to liquidate investment and other assets.
Tax deductions on premium and care costs will decrease the economic impact while taxes on appreciated taxable investments and liquidated qualified retirement funds will be fully or partially taxed. The model accommodates inclusion or exclusion of one or more of the tax items.
The model also allows you to include actual or estimated rate changes or premium discounts that would influence premium cost projections. Planning VariablesClient Data
Cost of Care Data
Insurance Data
Insurance Premium Calculation
Scenario InputPlanner and/or client input creates one or more scenarios using any of the range of variable choices . Planner may establish defaults for all variables for individual or two insured clients. Although these parameters are for an insured couple, the model also accommodates calculations for a single insured. Total Cost Calculations - Key Projections
The data used in the scenario created by the advisor and the client drives the projected cost of care without insurance. It starts with the current cost of care inflated to the period of time the care is needed. The adjustment to the cost of care, if included in data input, either increases or decreases the projected cost of care due to asset liquidation costs and either tax deductions or tax increases. If the loss of investment opportunity is included in the planning variables, the cost of care is increased to reflect the loss of investment for each year and cumulatively throughout the plan period.
Similar to the cost of care projections, the total benefit value calculation
works from the annual dollar claims paid that are based on the insurance benefit
design. For example, it the policy has a 90-day elimination period, the first
year benefits reflect the delay and the annual benefit paid the first year is
based on 275 claim days (365-90). If the policy design covers fewer years than
care years the 90 days would carryover so the full dollar amount of benefit
available is reflected in the projected value of the insurance plan. In other
words, the model assumption is that the policy is a "pool of money" product.
The insurance benefit is adjusted to reflect the same "Advanced Planning"
assumptions used in the cost of care assumptions.
Self paid care costs are those insurable costs not covered by the policy design. Examples include: deductible periods, inflation on care cost greater than the inflation option selected in the insurance plan, care years greater than benefit years, and other insurable but self funded care costs.
This is the policyholder's "out of pocket" for insurable self paid care cost not covered by insurance in this scenario, plus the economic impact of insurance premium.
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