At What Age Should You Buy Long-Term Care Insurance?

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Even if you're are in good health today, there's a good chance that you'll eventually need some type of long-term care, at least for awhile. Over 70% of people over age 65 will need some long-term care, according to a study by the U.S. Department of Health and Human Services.

Without long-term-care insurance, which typically covers the cost of nursing homes, assisted-living facilities and in-home care, the later years of life can be financially taxing for seniors and their families.

Average Costs of Long-Term Care

According to Genworth Financial's 2016 Cost of Care Survey, families will incur a great deal of expense related to long-term care. The average nationwide costs for various types of care are listed below.

  • Nursing Home, Private Room: $92,378 per year
  • Nursing Home, Semi-Private Room: $82,125 per year
  • Assisted Living: $43,539 per year
  • Home Health Aides: $15 to $28 per hour
  • Adult Day Health Care: $68 per day

Timing Is Everything

People should start thinking about purchasing a long-term care policy at around age 50, says Jeffrey Condit, Senior Vice President and AARP Relationship Leader for Genworth Financial.

"The best rates and range of services are available when a person is still healthy. Middle age is the best time to think about buying long-term care insurance because that's when a person is most likely to qualify for a policy and when premium costs are at their lowest. Genworth believes buying LTC insurance is a key element for any solid retirement plan, for anyone with assets that he or she wishes to pass along to the family, not the nursing home."

Benefits of Buying LTC Insurance in Your 50's

Health

Your health is generally good, and you have assets that you want to protect (including your home).

Premiums

The premium at age 50 is significantly less than at ages 60 or 70. For example, the typical premium for a married 50-year-old in good health is approximately 27% less than the same coverage for a buyer at age 60, and 62% less than the same coverage for a buyer at age 70.

Retirement Planning

You are still of working age, and have a number of working years to build your retirement assets.

Inflation Coverage

You can buy 5% compound inflation coverage which is a guaranteed coverage growth rate, so your insurance policy keeps up with the rising costs of long-term care.

Buying LTC Insurance in Your 70's

Family members can also purchase long-term care insurance for their parents – but price is the issue for seniors. A policy may still be affordable and available for your parents if they're in their 70s, depending on their health history. Here are some factors that affect an elder's eligibility to get long-term care insurance and the price of the policy.

Age

The older your parents are, the higher the premium. Oftentimes, people over the age of 80 may not be able to get long-term care insurance. Check with the insurance provider directly to see if your parent qualifies.

Health

Prior or existing health conditions can raise premiums or disqualify an individual for a policy. These conditions are revealed during underwriting, which may include both an examination of your parents' medical records and a physical exam by an insurance company doctor.

Coverage

The more types of care the policy covers, the higher the premium.

Benefit Amount and Duration

The higher or longer the benefit, the higher the premium.

Waiting Period Before Benefits Begin

The shorter the waiting period, the higher the premiums.

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52 Comments

I only hope I'm wasting my money by buying long term care insurance. (or buying good karma)
My mother spent five years with 24 hour care in my parents home. Thank goodness for the insurance. The paperwork was cumbersome for Dad, but was totally worth it . Perhaps that is because we had such marvelous care-givers and Dad could afford to supplement the insurance.
My mom (89) has a LTC plan from unum. We've had this plan for 16 years. It pays around $3175 per month. Her AL costs $3775. Her social security pays the rest with about $500 leftover each month. This policy was a godsend! Unfortunately most of the these days are not as good and unum during sell them anymore.
Third time asked (Malorie 1x and me twice)... Does anyone know what percentage of people default or die before these LTHC policies are used?