Do I need LTC insurance and if so, what is a reasonable cost (percentage) of my income?

From what I have learned in my own search for LTC insurance, the cost is very high at our age, and the benefits are low.

Expect to pay $750 per month or more. No benefits payable in the first 5 years. After that, the daily benefit starts at $65 per day and gradually increase to a max of about $150 per day after 15 years.

Really? You are better off putting that $750 away ... in 15 years you will have more than the max life benefit of these policies.

Insurance companies are dropping out of this market. People live a long time, and they are losing money on the old policies. 

So, look close at the qualifying conditions.   You have to have 3 of the 5 following conditions....  cannot walk, cannot toilet, cannot feed yourself (does not mean cook), cannot dress yourself, cannot bathe yourself.

You could be completely bound to a wheelchair, and still not qualify!  

The overriding condition is dementia.   

Still hard to qualify, hard to keep the benefit.   AND! Before you can start collecting reimbursement under this policy..you have to first pay out of pocket up to 90 days yourself.   Not qualify for 90 days...actually pay a licensed and certified agency 90 days.     If you only have help 5 days a week...then 90 days will actually take 18 weeks to satisfy.     Then, even at $150 per day...it covers only about 8 hours.

My Mom has such a policy.  Purchased 17 years ago.   It is a great policy for her.   It pays for up to 10 hours a day for her...it works for her because she has me all the rest of the time...and I actually only use it a few hours a day so that the benefit max. Lifetime payout will stretch for the rest of her expected life.   

BUT!   They do not write these policies any more.   And it was REALLY expensive.

I encouraged my parents to purchase LTC insurance. They have bare minimum policies & have been paying on them for 15 years. I'm in the process of filing a claim on my mother's behalf. The process is VERY complicated: you have to get this form & that form completed by various people', you have to provide billing statements from facilities, etc. Since my parents live 7 hours from me, it has been a difficult process. I understand the need to make sure she meets the criteria, but, at age 87 she would never be able to do this herself. There are entities that will help you make a claim, but it's hard for me to justify paying someone to obtain these benefits after she has been paying all this time! Bottom line, I agree with those who recommend taking the $$ you would pay in premiums & invest it wisely. It will be much easier to take advantage of later on.

If it pays out a max of $500k and you don't anticipate drawing down all of your savings I'd think twice since you seem to live well within your guaranteed income
I'm not a big believer in spending money so kids get a benefit - you could end up shelling out $250k before you ever use it

If you invested $1100 a month and could generate 3% say in a long term muni tax exempt bond fund you'd have $270k in 20 years tax free which of course would pass to your heirs at the value at the time of your death so no taxable income to them if they liquidated the fund

Nature,
I actually thought the process to get my mom's claim approved was so time consuming by design that some people would just give up and thank goodness I had both financial and health power of attorney - unfortunately since memory care is considered assisted living she only receives 60% of her benefit which doesn't even cover a third of the cost of her facility

Are you absolutely sure that a long-term care policy company will even be in business when/if you need to make a claim?
If you are crunching the numbers, factor in the percentage of possibilities that you will never need LTC and will leave this earth by so many other various natural occurences.

So, in your financially secure status, arrange to have your own care, on your terms. imo.

Respecting KatieKate's right to post her own personal opinion from experience here without accusations that her understanding is severely flawed.

I would highly recommend LTC. I'm 60 but got about 5 yrs ago and pay about $300/mo. It covers about $200/day but does adjust to inflation if those costs rise. AL in NC runs from $2500-4000/mo and then memory care where my mom is (moderate facility) is $8K/mo. NH can be upwards of $12K/mo and in-home care (if you should ever need 24/7) even for short period is about $400/day. So those expenses add up very fast. As you can see, even at $1000/mo investment; if you paid for the next 20 yrs and you needed at age 85; you would've invested $240K; but in 20 yrs that would be only 2 yrs of care and then they go thru your assets -- before medicare can kick in. That leaves nothing to your heirs. My mom is in good physical health but mentally incompetent. She just entered memory care at $8K/month. We are selling her house and she and my dad saved very well for retirement and conserved most. But even at that, mom will go thru all her money (investments, savings, house sale) etc. in 5 yrs provided she doesn't enter NH or have added costs (for example, even in memory care, should she need skilled care or personal assistance -- that all is an added expense above the monthy fee).

We don't want to burden our children. I pray I will not need or linger longer than the 3 yrs

Just to be clear, knowing what I know now I'm sorry I encouraged my folks to buy LTC insurance.

Thanks to everyone for their comments. As a matter of fact, my (former) CFP is also an insurance agent, so I'm sure that is why he pushed for the life insurance with a LTC rider.

Respecting Katiekate's right to post her own opinion from personal experience here.