Longterm Care Insurance

People are living longer and generally healthier lives. The average life expectancy is now 79.5 years for women and 74.1 years for men (National Center for Health Statistics, 1996 - 2000). And with better living conditions, nutrition, and medical care, people will probably live even longer in the future.

But there's a downside. Longevity is increasing the need for health care. It is estimated that 48% of Americans over age 65 will need skilled nursing facility care and the cost of this care varies (AARP National Nursing Home Study 1996). For example: in New York, the average annual cost of nursing home care is over $70,000; in Florida, it is over $45,000 and in California it is over $51,000 a year (General Accounting Office, testimony before the Special Committee on Aging, U.S. Senate, 3/9/98). Your plan should consider protection for the long-term care you may need in your later years.

Long-term care (LTC) insurance policies help cover the costs of extended nursing home care. Some policies also cover assisted home care, adult daycare centers, and other community-based care facilities.

Policies are flexible in design, letting you tailor the coverage to fit your financial needs and circumstances. You must be in good health to purchase a policy. Premiums may be high and are based on age, health, geography, and the benefits you select when you purchase the policy.

But I'm Too Young
If you're under 50, you might think you're too young to even consider purchasing long-term care insurance. Chances are, it will be a long time before you need long-term care. But as with life insurance, it's much cheaper to buy when you're young, and it will probably also be easier to qualify when you're younger and healthier.