Who Should Consider Long-Term Care Insurance?

Long-term care insurance is something most people should consider as they approach retirement. According to the Administration for Community Living, a person who is reaching their 65th birthday today has a 70% chance of needing long-term care at some point in their retirement. One in three 65-year-olds will not need long-term care. However, one in five will spend more than five years living in a long-term care facility.

Women Typically Spend More Time in Long-Term Care Than Men

On average, women spend 3.7 years in long-term care facilities, while men spend just 2.2 years in care. This makes long-term care insurance a particularly good investment for women. However, insurance policy prices reflect this disparity, with men typically paying less for their coverage than women. Fortunately, policies for couples are usually more expensive than taking out separate coverage for the husband and wife, so a couple can save money by taking out a joint policy.

The Best Time To Take Out a Policy is in The Mid 60s

Long-term care insurance costs less for younger people, but if a policyholder doesn’t need care for several years after taking out the policy, this could mean they spend more on insurance in total compared to someone who takes out the policy a couple of years later. Premiums rise rapidly over the age of 65, however, offsetting any savings from waiting to start the policy. 

The older a person is when they take out the policy, the higher their premiums will be. Most long-term care insurance providers have an upper limit on the age of new customers. There may also be limits on people with pre-existing conditions, and waiting periods preventing someone from claiming for care costs within six months of taking out a new policy. For this reason, it’s a good idea to start planning for long-term care while still in generally good health.