Those in between-the ones who stand to lose a substantial amount of their assets to long-term care costs-face the tougher choice of deciding between extra security and a higher income. "The cost of this insurance is pretty significant and becomes a sizeable factor in their budget," says Jim Garvey, an associate with Northstar Financial Planning Inc. in Hudson, N.H.

Illustrating the point, Garvey cites the case of a married couple who are clients of his. Both in their late sixties, with about $1 million in assets, they wanted to protect their assets in a way that would provide them a comfortable life for the next 30 years.

Garvey then worked the numbers based on what it would cost them for a long-term care policy that would provide a maximum benefit of $1.25 million. The way he figured it, over the course of 25 years, the policy would cost the couple about $350,000 in premiums and lost return on their investments, assuming annual compounded interest of 7%. If the assumed growth rate were hiked up to 10%, however, the cost came to around $600,000-nearly half the policy benefit, he says. In the end, the couple decided on a policy with a slightly lower premium. "That's why it comes down to a subjective call of one's feeling about protecting your assets," he says.

Crafting a policy to fit a client's plan requires a detailed knowledge of the market and what's available, which is why many advisors turn to an insurance broker. Garvey, for example, works with independent brokers who have access to multiple insurance companies and who specialize in long-term care insurance and nothing else.

How did he size up the brokers to whom he refers his clients? "It's like anything else. It's a relationship," he says. "You have to build a level of trust with the people you are working with."

Garvey says it also takes a knowledge of long-term care insurance on the part of the advisor, which is why some advisors are seeking training in the area. The Corporation for Long-Term Care Certification in Newton, Mass., for example, offers two days of training and an exam that gives successful candidates a Certified in Long-Term Care (CLTC) designation.

Michael Eisenberg, an associate at Financial Design Associates in Berkeley, Calif., got the certification earlier this year after his firm observed increased client interest in the insurance. "We decided this is an important issue for clients and that we should have the capability to at least address the issue intelligently," Eisenberg says. About 20% of the firm's clients responded with interest to a letter about long-term care insurance the firm mailed out in September, he adds.

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