Best Long Term Care Insurance
Based on In-Depth Reviews

Long-term care insurance is a breed of its own. Unlike other types of insurance, such as life insurance and medical insurance, in which you have a solid reason for purchasing them, long-term care is the type of insurance that makes you ask, “Do I really need this?” The average person is not trying to spend money on an insurance policy to cover something that may or may not happen twenty to thirty years down the line. Yet, those who do try to obtain coverage don’t do so until it’s too late. 

“Home care on average can cost $132 a day. Adult day services can cost $72 a day. Assisted living facilities can cost $4,000 a month or $48,000 a year. Semi-private rooms for a nursing home can average $245 a day or over $89,000 a year. You can see these costs can add up very quickly. 

We know that long-term [care] insurance can be a huge help for families, but most of the families we deal with do not have it. And we also know that the best time to plan for long-term care is to do it before you need it, but many families don’t have these important discussions until they’re in a crisis situation.”
- Ruth Drew, Director of Information & Support Services at the Alzheimer’s Association

The key is to understand exactly what long-term care insurance covers and why this type of insurance is beneficial for your quality of life. 

Consider your grandmother who sometimes needs the help of her cane to get around or your favorite uncle who survived a heart attack and now must monitor his blood pressure and diet—both currently need an eye kept on them from time to time. Has anyone in the family discussed future caretaker plans in case their health worsens? Are you all aware of any diseases or illnesses that run in the family, such as dementia or diabetes? 

This is when you should start thinking about long-term care: many, many years in advance. Long-term care insurance is designed to cover the costs of consistent care during an extended period of time. If your grandmother or your uncle’s condition becomes debilitating, long-term care insurance policies could reimburse them a daily amount of money to cover care services. 

Before choosing a long-term care insurance plan, it’s important to analyze and weigh your options. We’ll walk you through the statistics of long-term care to help you reach a better understanding of how to prepare, followed by an explanation on what to expect from long-term care insurance providers.

What is long-term care insurance?

Long-term care insurance is a type of coverage that pays for services such as home healthcare and assisted living when you become unable to take care of yourself due to physical or cognitive impairments. This coverage can help you maintain your quality of life and avoid you becoming a financial burden on your family.

How does long-term care insurance work?

Long-term care insurance pays a daily amount to cover the cost of care up to an annual or lifetime limit. There is also usually a limit on the maximum daily benefit that the policy will pay. Most providers allow you to choose from a variety of policies that have different coverage levels and benefit periods. Some providers also offer hybrid policies, which combine long-term care insurance with other types of coverage, such as life insurance or annuities. For example, if you die before using your long-term care benefit, a hybrid long-term care life insurance policy would pay a death benefit to your beneficiaries.

What does long-term care insurance cover?

Long-term care insurance typically covers a variety of services, including home healthcare, assisted living facilities, and nursing homes. It may also provide reimbursements to your family if they provide you covered care at home as well as coverage for adult day care services. Each policy is different, so make sure to check with your provider to understand what is covered under the specific plan.

Long-term Care Statistics

It’s easy to think your family will step in and care for you in your later years, and while about 80 percent of home care is provided by unpaid caregivers, such as family members and close friends, it doesn’t mean they will have the experience or the time to do so. 

The average caregiver spends 20 hours a week providing care. It takes commitment for someone to dedicate at least four hours of long-term care services each weekday, especially if they have a job or are caring for their own children or home. Graciela García, a retired registered nurse, spoke to us about her own experience providing in-home care for her mother before her passing. Garcia’s mother, who suffered from the third stage of Alzheimer’s, needed round-the-clock care. 

García explained that although she was a nurse, the tasks she performed were still physically and mentally exhausting. She didn’t have help from other family members to care for her mother and was also a widowed mother of two young children. García was grateful that her mother’s medical insurance at the time provided for medicine and other necessary equipment, but she the type of care her mother needed required her undivided time and attention, forcing her to seek financial assistance to help pay their utility bills. 

Cost of Care

Consider how much more expensive it would have been for García to provide care for her mother had she not been an experienced registered nurse or had full-time availability to do so. 

Let’s take a look at the average cost of different long-term care services:

**Stats based on Genworth Cost of Care Survey 2021, calculated as average annual cost assumed at 40 hours per week 

Keep in mind that these costs are only the nationwide average. They will vary depending on the state, region, facility type, and specific services required. 

Care factors

Additional factors to become familiarized with are age, health, and gender. These are what insurance underwriters analyze when determining care eligibility and individual policy prices. Statistically, women outlive men by 5 years and therefore are more likely to require care. Also, single individuals are more likely to need a paid care provider. It’s true that there’s a chance you’ll never need to use your policy, but that probability ratio is 50/50.  

Types of Long-term Care

There are different styles and living arrangements for long-term care, depending on the patient’s needs and comfort. Long-term care insurers generally offer coverage for the following:

in-home Care

Some people desire to stay in their own home: it’s comfortable, it’s familiar, and it’s private. Not everyone needs 24/7 support or assistance and, depending on the individual's needs, in-home services may be easier and much more affordable. The two common types of in-home care covered by long-term care insurance are personal care services and professional services. Personal care consists of handling daily care tasks, such as dressing and bathing, as well as homemaker services, such as cooking, household chores, and shopping. Professional care involves sending qualified individuals to perform medical assistance, such as a nurse, home health aide, or therapist. 

Nursing homes

Nursing homes can provide the care needed for individuals unable to live independently, as they require either round-the-clock care or assistance for most activities of daily living. Of all the care services covered, a nursing home is typically the most expensive, as residents require the most amount of care from professionally-trained staff and medical personnel.

Assisted living facilities

If you are able to live independently but need access to assistance or medical care, an assisted living facility may be a good option. In addition to the services provided with in-home care, assisted living may also include meals, recreational activities, transportation, and access to on-premise community facilities. Adult daycare and continuing care retirement communities are also covered under this option.  

Hospice care 

This type of care is meant to provide comfort and support to patients in the final stages of a terminal illness, with a focus on quality of life rather than a cure. The ultimate goal of this care service is for individuals to live as comfortably and pain-free as possible. 

Medical devices

Some long-term policies also cover the cost of either rented or leased in-home medical devices, such as respirators and hospital/adjustable beds.

Long-term care insurance industry trends

Before shopping and comparing long-term care policies, it’s best to have some background information on commonly-used terms and industry-standard policies.

Here’s what consumers can expect from long-term care insurers: 

Types of long-term care insurance policies

• Traditional Policy: The standard long-term care insurance option that can be customized according to the policyholder’s needs.

• State Partnership Policy: A federal program, also called the “Long-Term Care Partnership Program,” offered in several states. The goal is to increase the total value of assets participants could retain and still qualify for Medicaid, thus encouraging more people to purchase policies. All states except Alaska, Hawaii, Illinois, Massachusetts, Utah, and Vermont participate in the program. 

• Tax-Qualified Policy: Plans in which you can deduct long-term care insurance premiums as a medical expense tax write-off. Medical expenses are tax-deductible as long as they exceed 10% of your gross adjusted income.

• Hybrid Life Insurance Policy: Newer forms of long-term care insurance combine whole life insurance policies with long-term care coverage or an “LTC rider.” The advantage of these hybrid policies is that they’ll pay out, no matter what happens to you.

• Group & Employer Policy: Cost-effective policies offered as part of a group or through an employer’s benefits plan. The insurance company has the advantage of charging less per policy in exchange for selling dozens of them at once. 

Policy Riders (Add-Ons)

Policy riders are extra features that can be added to long-term care insurance plans at an additional cost. Though not every insurer will offer these, the most common long-term care riders include:

• Inflation Riders: A very common rider that increases daily maximum benefits and your lifetime maximum benefits by a fixed percentage every year for a specified number of years.

• Increased Benefits: Add this rider to increase the daily maximum benefit or the lifetime benefit limit on your existing policy.

• Spouse Survivorship: When one spouse dies, the surviving spouse on the policy will no longer have to pay their monthly premiums, but will still receive coverage.

• Shared Care: Allows you and your spouse to pool your long-term care insurance benefits rather than requiring each person to have their own separate policy.

• Return of Premium: Upon the death of the policyholder, a portion and, in some cases, the total amount of premiums paid for the policy will be returned to the designated beneficiary. These types of add-ons can increase policy rates by almost 50%.

Discounts

As mentioned earlier, some long-term care insurance companies offer employee discounts for corporations, since they’ll receive dozens of policyholders in return. Consumers can also expect partner or household discounts, in which the policyholders receive a special rate if they’re married or cohabitating. Lastly, there are insurers who supply other types of insurance in addition to long-term care, such as life insurance and disability insurance, and may offer multi-policy discounts to those who purchase more than one.  

Eligibility for Benefits

In order to qualify for benefits, you must be unable to perform at least two of the six activities of daily living. This includes bathing, dressing, moving to and from the bed, using the toilet, eating, and maintaining continence (bladder and bowel control). A medical professional is required to prove your lack of mobility and determine if it’s expected to prolong at least 90 days.

Benefits & Considerations

Since long-term care can be very expensive, long-term care insurance can protect your savings and help you maintain a better quality of life as you age. Though it usually doesn’t cover the full amount, it will reimburse a portion of the cost of care from a nursing home, assisted living facility, or in-home care. Also, there are some tax benefits associated with long-term care insurance, where some state and federal tax deductions allow you to write off premiums as medical expenses.

This type of insurance is meant to be purchased early on in life when you’re still healthy, as cost and denial rates increase as you get older. According to a recent survey, 38.2% of applicants between the ages of 65 and 69 were not approved for coverage.

Long-term care insurance premiums can be pretty expensive, which can be a financial burden for many, as they’ll be paying it for many years. Also, this type of insurance is not an investment. Unlike life insurance, which is guaranteed to be paid out, if you never need or meet the qualifications for long-term care, you may not receive the insurance benefits. 

How to get long-term care insurance

Now that you’re familiar with long-term care insurance, you can start the process of purchasing a policy. The first step is to research the various types of policies, riders, and benefits available. You should then compare different companies to find out which one offers the best coverage for your budget. Some companies do offer online quotes, but many will require an in-person or telephone consultation with a qualified advisor.

Things to take into consideration include the amount of coverage offered, how long it lasts, how long the waiting period is, and any riders or discounts you may be eligible for. Lastly, it can be a good idea to meet with an insurance agent who specializes in long-term care insurance to ensure you’re making the right decision for your current and future needs.

Alternatives for covering long-term care

After reviewing your options and understanding the pros and cons, you may decide that long-term care insurance is not for you. Although you can’t count on Medicare to pay for nursing home, home health care or assisted living, there are other alternatives to paying for long-term care: 

• Save money for long-term care. Considering the average cost of care, it’s definitely something that you want to start saving up for. Apply a portion of any benefits you’ve earned over the years, such as veteran’s benefits, your retirement fund, trusts, etc. to cover long-term care expenses. 

• Open a Health Savings Account (HSA), An HSA account is a savings account that allows users to earn tax-free interest and set aside savings for medical expenses.

• Purchasing a life insurance policy with a long-term care rider is also an option, as it's generally cheaper than a standard LTC policy. 

• Life Plan Communities, or continuing care communities, are also an alternative as members are guaranteed access to care even if they aren’t able to pay for it.  However, in addition to a monthly payment, these communities are expensive, requiring a hefty upfront payment—usually thousands of dollars.

• Apply for federal LTC coverage through the Federal Long Term Care Insurance Program (FLTCI). This program, sponsored by the U.S. Office of Personnel Management (OPM) is available to federal employees, active and retired members of the uniformed services, U.S. postal service employees, and qualified relatives.  

Medicaid can help with certain kinds of in-home care for people who qualify. Some people also qualify for veteran’s benefits, depending on when and where they served.