Last week a friend of mine said her long-term care insurance premiums had suddenly gone up by 39%. When she called her insurance company to see if this was a mistake, their answer was "no." It seems that people were beginning to actually make some claims and use the benefits of the insurance. Well, that suddenly hurt profits, so MetLife (the company in question) asked the State of Connecticut if they could raise their rates. The state said "yes." This is happening all over the country.
Shortly after I had this conversation, I read an article in the New York Times on the sudden increase in long-term care insurance premiums. Obamacare was partly to blame (due to several new regulations buried in the law). But there were other factors, too. It seems baby boomers aren't buying the insurance. In fact, sales are flat to down. Why? Some answers were in the Times article and others in a report by Milliman (an insurance consulting company).
Most people realize that our government indemnifies most of us from the catastrophic costs of a nursing home, home-health care or assisted living through Medicaid. You don't even have to give up your house, car or personal possession to qualify for Medicaid (in most states). The vast majority of older Americans qualify because they don't have a lot of savings and investments outside their homes. And those that do, have figured out ways to protect their estates.
In addition, the chances of needing the care are not as great as one would think. For people over 65, there is only a 45% chance that you'll make a claim. Not only that, only 14% of people stay in a nursing home more than three years.
So, if you can afford to pay $83,500 or more a year on a nursing home for three years, buying the insurance might not make sense. Long-term care insurance can cost $2,500 per year for a 60-year-old. But if rates continue climbing at 40% per year, that could be a lot of money to give up for a 45% chance you'll need it when you're in your 80s. Even if you do, the insurance may not pay all the bills.
The NY Times article and the study by Milliman give many more facts, opinions and food for thought. They are both worth reading prior to making any decisions about buying long-term care insurance. When looking at long-term care coverage, see how much they will pay out and for how long. Weigh the costs and benefits for yourself. Would your premiums earn you more if invested in stocks or bonds?
http://www.nytimes.com/2010/11/05/business/businessspecial5/05CARE.html
http://www.centerltc.com/milliman_cltcf.htm
Monday, November 8, 2010
Thursday, November 4, 2010
"The Reversal" is Michael Connelly's Best Book Ever
I'm diverting from writing about business because I just finished a fantastic crime novel -- "The Reversal" by Michael Connelly. I think all business people should take time to read for fun.
I am a huge Michael Connelly fan. Whenever I finish one of his books, I look forward to the next one. I used to live in LA and really miss the city. So I particularly love his dark descriptions of Los Angeles and its seamy underworld of sordid crimes, cops and criminal attorneys. I've grown very fond of his characters L.A.P.D. Detective Harry Bosch and defense attorney Mickey Haller, who Connelly developed in separate series of novels over the course of many years.
In "The Reversal", Connelly brings the two men together to nail a kidnapper and murderer. I'm not going to reveal the plot; it's best to read it for yourself. In most detective novels, the reader has to guess who committed the crime. That is not the point of this book. Rather, it's a story of how two prosecutors and a police detective work to find evidence to nail the bad guy. The unfolding of how Harry and Mickey work and think is really fascinating. Their characters' parallel lives with divorces, daughters and homes with sweeping views of Los Angeles (Mickey's looks West to the ocean. Harry's looks northeast (I think) over the Cahuenga pass and the Hollywood Freeway) pull you into the story and make you care.
Amazingly, the court room scenes of the murder trial are fast-paced and fascinating. And wondering what the bad guy will do next kept me reading past my normal bedtime.
Trust me. This is great escapist reading, grounded in a real city with characters you'll believe are real. That's what makes this book great.
I am a huge Michael Connelly fan. Whenever I finish one of his books, I look forward to the next one. I used to live in LA and really miss the city. So I particularly love his dark descriptions of Los Angeles and its seamy underworld of sordid crimes, cops and criminal attorneys. I've grown very fond of his characters L.A.P.D. Detective Harry Bosch and defense attorney Mickey Haller, who Connelly developed in separate series of novels over the course of many years.
In "The Reversal", Connelly brings the two men together to nail a kidnapper and murderer. I'm not going to reveal the plot; it's best to read it for yourself. In most detective novels, the reader has to guess who committed the crime. That is not the point of this book. Rather, it's a story of how two prosecutors and a police detective work to find evidence to nail the bad guy. The unfolding of how Harry and Mickey work and think is really fascinating. Their characters' parallel lives with divorces, daughters and homes with sweeping views of Los Angeles (Mickey's looks West to the ocean. Harry's looks northeast (I think) over the Cahuenga pass and the Hollywood Freeway) pull you into the story and make you care.
Amazingly, the court room scenes of the murder trial are fast-paced and fascinating. And wondering what the bad guy will do next kept me reading past my normal bedtime.
Trust me. This is great escapist reading, grounded in a real city with characters you'll believe are real. That's what makes this book great.
Friday, October 29, 2010
Ten Lessons From "The Social Network"
O.K. I'm a little late, but I finally saw "The Social Network", and my head has been spinning ever since. Plus, I can't get Trent Reznor's version of Grieg's "The Hall of the Mountain King" out of my head (the music over the rowing scene). The screenplay was so good, as was the editing, the art direction, direction, acting and the music. Overall, it was fine film making about people who intrigued me and repulsed me at the same time.
How much of the movie was true? Was Mark Zuckerberg motivated by a desire to be disruptive and accepted at the same time? I've been reading articles and Web sites like crazy, searching for clues. The movie seems to be pretty real. It's also real for me because I've been doing business plans for dot-coms and other businesses since 1999. My current client said he was chilled by how Zuckerberg pushed out and diluted his partner Saverin.
That's when I realized that "The Social Network" is chock-full of advice for anyone who wants to start a business. Here are Ten Lessons to be Learned from "The Social Network".
1. Be passionate. Allow the idea to consume you.
2. Open up your eyes and ears, and the ideas to help you fine tune your concept will jump out at you.
3. Be careful of whom you have as partners.
4. Get a good lawyer to advise you. Read all contracts carefully.
5. The best way to raise your seed capital is friends and family.
6. The only way to really get off the ground and grow is to make a working model of what you want in a small, exclusive market. Test it out. (That's called a proof of concept.)
7. If your proof of concept takes off, then it's easy to raise more money from angels &/or VCs.
8. Networking can get you in the right doors.
9. Be bold in your thinking. Disruptive technology really does change things.
10. Understand what needs people really have, and fill that need. (People want to be cool. People want to be exclusive.)
If you haven't seen the movie yet, go see it. And take these 10 pieces of advice with you in your mind. You'll see them all illustrated over the course of the film. "The Social Network" is essentially a true story. Breaking up with a girl may not have been Zuckerberg's real reason for creating FaceMash at Harvard and then The Facebook. But all the main characters in the film are real. The lawsuits are real. The lessons are real.
If you don't believe me, go do your own research.
http://www.vanityfair.com/culture/features/2010/10/sean-parker-201010
http://www.businessinsider.com/winklevoss-arrest-lawsuit
http://www.businessinsider.com/facebook-movie-zuckerberg-ims
How much of the movie was true? Was Mark Zuckerberg motivated by a desire to be disruptive and accepted at the same time? I've been reading articles and Web sites like crazy, searching for clues. The movie seems to be pretty real. It's also real for me because I've been doing business plans for dot-coms and other businesses since 1999. My current client said he was chilled by how Zuckerberg pushed out and diluted his partner Saverin.
That's when I realized that "The Social Network" is chock-full of advice for anyone who wants to start a business. Here are Ten Lessons to be Learned from "The Social Network".
1. Be passionate. Allow the idea to consume you.
2. Open up your eyes and ears, and the ideas to help you fine tune your concept will jump out at you.
3. Be careful of whom you have as partners.
4. Get a good lawyer to advise you. Read all contracts carefully.
5. The best way to raise your seed capital is friends and family.
6. The only way to really get off the ground and grow is to make a working model of what you want in a small, exclusive market. Test it out. (That's called a proof of concept.)
7. If your proof of concept takes off, then it's easy to raise more money from angels &/or VCs.
8. Networking can get you in the right doors.
9. Be bold in your thinking. Disruptive technology really does change things.
10. Understand what needs people really have, and fill that need. (People want to be cool. People want to be exclusive.)
If you haven't seen the movie yet, go see it. And take these 10 pieces of advice with you in your mind. You'll see them all illustrated over the course of the film. "The Social Network" is essentially a true story. Breaking up with a girl may not have been Zuckerberg's real reason for creating FaceMash at Harvard and then The Facebook. But all the main characters in the film are real. The lawsuits are real. The lessons are real.
If you don't believe me, go do your own research.
http://www.vanityfair.com/culture/features/2010/10/sean-parker-201010
http://www.businessinsider.com/winklevoss-arrest-lawsuit
http://www.businessinsider.com/facebook-movie-zuckerberg-ims
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