How Much Does Long Term Care Insurance Cost?

Most people know they need long term care insurance; however, they don’t know if they can afford it.

Below we explore how much long-term care insurance costs vs. the cost of not owning a policy.


Understand That Most People Will Need Long Term Care Sometime Throughout Life

Did you know that by the time you reach 65, you have a 50-50 chance of needing some form of long-term care? Additionally, the department of health and human services states that 7 out of 10 individuals over age 65 will need long term care sometime before they die. In other words, it’s essential to face the reality that you, too, will likely face long-term medical costs sometime in your future.

You Have Two Options

Once we come to terms that we will likely need long-term care sometime throughout our lives, we can either turn a blind eye and hope for the best or begin to plan for what is likely to fall upon us down the road.

Unfortunately, many people fail to plan and ultimately find out that having no plan is far more expensive.

The Cost of Care without a Long Term Care Insurance Policy

The overall cost of care varies based on age, geographic location, care setting, and the level of care required, among other things.  However, a recent survey shows the median cost of long term care for individuals without a long term care insurance policy.   

Long-Term Care Service Average Annual Cost Nationwide
Assisted living facility $48,612
Home health aide $52,624
Shared nursing home room $90,155
Private nursing home room $102,200

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Cost of Long Term Care Insurance Policies

What we’re considering here is the cost of buying a long-term care insurance policy vs. the cost of not owning a policy at all.  What we are trying to show in these two tables is just how much more expensive not owning a policy is compared to policy ownership.

Here’s the average cost of long-term care insurance along with the lowest and highest insurance rates according to the American Association of Long-Term Care Insurance.

Average Long-Term Care Insurance Costs in 2020
Average Cost for Age 55 Annual Premiums
Single Male $1,700
Single Female $2,675
Couple (Combined Premium) $3,050
Lowest Cost for Age 55 Annual Premiums
Single Male $1,876
Single Female $3,141
Couple (Combined Premium) $4,825
Highest Cost for Age 55 Annual Premiums
Single Male $3,081
Single Female $5,085
Couple (Combined Premium) $8,534

**The lowest and highest cost premiums compare only the top five long term care insurance providers. **

As you can see above, owning a long-term care insurance policy is far less expensive than paying for LTC out of pocket. Unfortunately, so many people never purchase long-term care insurance because of the idea that it’s too ‘expensive’; when in reality, not owning a policy will likely result in significantly greater financial hardship in the future.

Why Do Long Term Care Insurance Cost Vary So Much?

The cost of long term care insurance varies significantly between carriers. Each carrier sets its rates and has a so-called “sweet spot” for serving a specific age group and demographic. It has been found that prices between carriers can differ as much as 20-60%!

For example, AARP currently has one of the lowest cost policies on the market for 55-year-olds; it is one of the most expensive options for individuals over age 65. Each company caters to a specific age group, which is why it’s so important to shop and compare before you buy.

Other Cost Factors To Consider

Your age, health, gender, state of residence, policy amount, and contract length all affect the cost of your long-term care insurance policy.

Health – You must health qualify in order to purchase long term care insurance. Individuals with pre-existing medical conditions will have difficulty finding coverage, and many will fail to qualify.  Therefore, it’s important to lock in your policy BEFORE your health deteriorates.  Many individuals wait until they have severe health complications and are denied coverage. 

Age – As with all insurance products, the older you get, the higher the premiums.   Rejection rates also increase with age. Therefore, the quicker you begin shopping for your policy,  the lower the premium and overall cost. 

Finding Your Lowest Cost Long Term Care Insurance Policy

The most important action you can take to ensure an affordable long term care insurance policy is to act soon rather than later. As discussed above, the longer you wait, the higher the premiums. The second most important thing you can do to save money on your policy is to work with an independent t insurance agent, someone who doesn’t work for the insurance companies but instead works for YOU!

Our team of independent insurance agents is here to help you shop and compare all the top companies and policy offerings nationwide. We’ll help you find your lowest cost option and customize your policy to fit your lifestyle and budget.

Our services are free, and there’s never any obligation when working with an agent.

See why thousands of individuals have trusted us to help them plan and prepare for the future. Explore your options today by filling out the form on your screen.

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