Factors That Affect Your Long-Term Care Insurance Costs

Long-term care insurance (LTC) pays for quality nursing home, assisted living or in-home care if you need it. When you consider that the average private nursing home room cost $99,736 in 2015, you see how important an LTC policy is for your peace of mind. Plus, it protects your financial assets that would otherwise pay for your care. Before you purchase this valuable insurance coverage, learn more about the factors that can affect your policy’s premium cost.


Your age at the time you purchase a long-term care insurance policy affects the premium cost. Additionally, your rate can increase by three to five percent every year you wait to purchase coverage. Don’t let your age push you to rush this purchase, though. Take your time and research your options to ensure you buy the right policy for your needs.


Enjoy lower long-term care insurance policy rates when you purchase a policy while you’re healthy. Rates increase if you develop health conditions or take too many prescription medications.


An average long-term care insurance policy includes benefits like waiver of premium, alternate care, equipment and home modifications, bed reservation and homemaker and chore service. You may purchase additional riders, too, including:

  • Inflation protection
  • Restoration of benefits
  • Survivorship benefit
  • Waiver of Home Health Care Elimination Period
  • Return of Premium
  • Nonforfeiture benefit
Each of these riders increases your total cost by five to 75 percent, so choose your coverage carefully as you balance your expected needs and budget.


You could qualify for preferred health or marriage discounts. Ask your insurance agent about these and other discounts that could save you money on your long-term care insurance policy.


You may decide to wait and purchase long-term care insurance right before you need it or after you save money for the premium. While you are wise to consider this purchase carefully, examine an example that illustrates how waiting will affect you.

At age 50, John purchases a long-term Care Insurance policy with a $4500 monthly benefit, four-year benefit period, 90-day elimination period and three percent inflation protection. His premium costs $2,707 per year. When he’s 85, he will have paid $94,745 in premiums. At age 55, John will pay nearly $3,589 per year for the same coverage. His total premiums paid equals nearly $107,670. John could save almost $13,000 by purchasing a policy earlier.

Afford the long-term care insurance that gives you peace of mind when you consider these factors that affect your policy’s cost. Discuss your specific needs and budget with your insurance agent as you choose the right policy for you.
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