When it comes to long-term care insurance (LTCI), there is a lot to consider. Unlike saving for college or retirement, you never really know if you’ll end up needing long-term care. And unlike health insurance, long-term care insurance only comes into play should the extreme happen.

Long-Term Care Insurance (LTCI): A policy that helps cover the costs of services that aren’t covered by regular health insurance, but might be needed in your later years, such as assistance with routine daily activities, like bathing, dressing, or getting in and out of bed. Most policies will reimburse you for the care given in a variety of places, such as your home, a nursing home, or an assisted living facility.

Should You Buy Long-Term Care Insurance? 

It may be overwhelming to take on additional costs you might never need, especially if you are retired. You might be better off setting aside funds “just in case”. But at an average cost of $140,000, long-term care is expensive. Financial and health experts have provided questions to ask yourself in order to evaluate if you might want to take on an LTCI policy.

  • Do you lead a healthy lifestyle? Believe it or not, this might mean you need long-term care. Adults who lead unhealthy lifestyles typically pass away sooner from cancers or heart disease. A healthy lifestyle can take you well into your hundreds, with the centenarian population growing 65% the past three decades.
  • What does your family history say? Did your grandfather live to be 102? Then you might need to budget for long-term care for the years when your brain is still sharp, but you may need assistance with daily living. On the other side, if you have a history of Alzheimer’s or dementia you may require specialized care.
  • Can You Afford It, or Can You Afford Not to Have It? If you have a lot of money saved, you might be able to afford these costs out of pocket. On the other hand, those below the poverty line can possibly have their care covered by Medicaid; however, for those who reside in the middle, a long-term care insurance policy can be a source of comfort. Like home insurance, these policies are for worst-case scenarios, with many individuals having their policy for years and never using it.

In addition to asking yourself the preliminary questions, it’s important to examine the pros and cons of an LTCI. Knowing what pros outweigh the cons, and vice versa can help you decide if an LTCI fits your personal needs.

Pros Of Long-Term Care Insurance

  • LTCI provides peace of mind for you and your loved ones. Knowing your needs are taken care of, even if you can’t take care of them yourself, relieves a potential financial burden from your shoulders.
  • LTCI provides protection for your financial wealth. If using up all your savings on a potential extended care stay concerns you, long-term care insurance is for you. You won’t have to fall back on the sale of your assets or the goodwill of loved ones.
  • LTCI guarantees you the care you need. A private room in a nursing home can cost over $8,000 a month. Many seniors who get injured might choose not to receive the full-time care they need due to this cost, as it’s not covered by traditional health insurance. Long-term care insurance means you don’t have to make the decision to sacrifice your own wellbeing.

Cons Of Long-Term Care Insurance

  • LTCI is expensive. Premiums for LTCI’s have gone up steadily, with the average policy costing 2,700 a year. For many families, this is a budgetary stretch. If you have a poor family health history or poor health, your premiums will be even higher. Like any other insurance, you’ll have to weigh the cost with the likelihood you’ll need long-term care.
  • LTCI might be hard to come by. With insurers realizing the cost of long term care, many carriers are not issuing new LTCI policies. There are policies out there–but it might require extensive research to find one. Don’t accept the first policy you find out of convenience.
  • LTCI could be redundant. If you qualify for Medicaid or have one of the rare health insurance plans that cover long-term care, you won’t need LTCI. Check to be sure you aren’t already covered before you start shopping.

In all, LTCI is like other insurance policies–you will have to shop around to find the perfect fit for your budget and needs, you’ll have to weigh your risks, and you might never use it. But on the off chance you do, LTCI can save you from a huge financial burden.

Take The Next Step With Long-Term Care Insurance

Need some extra assistance when it comes to long-term care insurance? Our DwellAssured-Certified Experts can help you with that important step of your aging in place plan. Visit our DwellAssured-Certified Service Provider Network to learn more.

  • AARP
  • NerdWallet

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