The cost of long term care insurance depends on a number of factors. To calculate what long term care insurance could cost for you and your family, you must consider a number of variables, such as:
Below, we’ve briefly outlined each of these variables, as well as provided a number of options for how you can reach a calculation for the cost of insuring yourself for long term care.
Like most insurance products, age factors into the cost of LTC insurance. In general, the earlier you purchase your policy, the better (least expensive) it will be. Not only is your current age important, but you should also consider that the future is unknown, and your health may change and affect the underwriting (see next paragraph) or in a worst-case scenario, you could become uninsurable. Historically, insurance carriers have changed the pricing and benefits of their products, so it would be wise to lock in today’s plan now, at the right price.
Your health will have an impact on how the cost of your LTC insurance is calculated. Applicants with preferred health status are often eligible for discounts upwards of 10 – 15%. Applicants with minor health impairments may have to pay a higher premium, be limited in their coverage, or both. All insurance companies will want to review your health before issuing a contract.
The LTC Insurance options available to consumers vary from state to state. Be sure to let us know your resident state so we can provide accurate pricing.
Long-term care policies cover many different levels of care, including care at home, assisted living facilities, or nursing homes. The level of coverage you choose will have an impact on your cost. The more comprehensive policies will provide the same benefits no matter where you choose to have care. Different companies and products have different definitions of what kind of care is required to receive benefits. The most restrictive language requires that home care be provided by a licensed home care agency; the most liberal contracts will pay cash directly to the insured, no reimbursement forms required.
While we cannot predict the exact rate at which the cost of care will increase, history tells us that costs will go up over time. You can keep pace with these increases by adding an inflation rider to your policy. T
here are many options to consider, and we will assist you in determining the one that best suits your situation. The younger you are when you purchase your policy, the more critical it is to factor in inflation, as it will most likely be many years before you need to access your benefits.
When calculating the cost of long term care insurance, Years Until Care is Needed works side by side with Inflation Rate projections to help you arrive at your estimate. More specifically, the more Years Until is Care Needed, the higher the Inflation Rate will be when your benefits kick in, and the more expensive your care will be.
Schneider and Shulman Associates offers free long term care insurance proposals. We consider all the factors outlined above, and then customize several different options to give clients a range of choices for their long term care planning.
As an additional resource, we recommend Mutual of Omaha’s long term care insurance calculator.