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How Does Long Term Care Insurance Work and Why Should I Know?

How Does Long Term Care Insurance Work and Why Should I Know?

| February 26, 2019

Half of Americans turning 65 will develop a disability serious enough to require assistance…


Long term care is assistance with daily living activities when you experience a serious illness or disability and cannot care for yourself. This could include help with bathing, dressing, feeding, etc. and can be delivered in your own home or in an assisted living or care facility. Medicare support of these services is very limited and you have to qualify for them. Many people will seek out LTC insurance to cover part or all of their future needs.


According to research, 52% of Americans turning 65 will need long term care (LTC) services lasting less than two years. And one in seven Americans will have a disability lasting more than five years.[1] Chronic health issues, poor diet and exercise, living alone, and family history could also increase your need for LTC services.


Research also shows an American turning 65 today will incur $138,000 in future LTSS costs on average.[2]


LTC insurance policies can vary greatly and a variety of factors will affect your level of coverage and the price of your plan.

According to Advisors Insurance Brokers (AIB), the four main decisions when designing a LTC insurance policy are:[3]

  1. The Benefit Amount – how much the policy will pay you vs. how much you are willing to pay out of pocket
  2. The Benefit Period factor – how long the policy will pay
  3. The Elimination Period – the number of days the policyholder is willing to pay for care out of pocket (generally 0-100 days)
  4. Inflation – options to help the policyholder keep up with increasing costs over time


Depending on these factors, the cost of the plan can vary greatly. Working with a financial advisor to walk you through all of your options can help you identify a plan that best suits your family’s needs.


Reach out to me to evaluate your personal situation and to discuss if you could benefit from a LTC insurance plan.