Long-Term Care Fundamentals

Long-term care isn’t just about nursing homes—it’s the help you might need with everyday activities like bathing, dressing, or eating if life takes an unexpected turn. Planning for these possibilities now can protect your independence, assets, and loved ones down the road.

Why Consider Long-Term Care Insurance?

The costs of long-term care are significant—and rising every year. Without a plan, these expenses can quickly erode savings and create stress for families. In 2025, average monthly costs include:

Source: Genworth 2025 Cost of Care Survey (national averages).

Traditional health insurance doesn’t cover these costs. Medicare and Medigap only pay for limited, short-term needs, and Medicaid is only available to those who meet strict financial requirements. That’s where long-term care insurance (LTCI) comes in—as a private solution for protecting your income and assets.

How Does Long-Term Care Insurance (LTCI) Work?

LTCI pays a set daily benefit for qualifying care services once you meet the policy’s requirements—often needing help with a certain number of ADLs or due to cognitive decline. Benefits typically begin after a waiting (elimination) period. Policy terms, benefit amounts, and covered services can vary widely, so understanding your contract is essential.

How to Compare Different LTCI Policies

There’s no one-size-fits-all policy. A knowledgeable advisor can help you review and compare:

• Outline of coverage and any exclusions
• Benefit amounts and duration
• Insurer financial strength (check Moody’s or Standard & Poor’s ratings)
• Policy features such as inflation protection or return of premium

How Much Does LTCI Cost?

LTCI premiums depend on several factors, including your age, the daily benefit selected, the length of coverage, optional features, and your health at the time of application. Buying younger often means lower premiums and more options.

Key Features to Consider in LTCI Policies

Work closely with your advisor to understand these important terms:

• Elimination period: Waiting time before benefits begin
• Benefit duration: Maximum years or total dollar amount
• Daily benefit: Amount paid per day of care
• Inflation rider: Keeps your benefit growing with costs
• Covered settings: What types of care/facilities are included
• Exclusions: Conditions or situations not covered
• Premium increases: When and how your costs might change
• Guaranteed renewability: Your ability to renew regardless of health
• Return of premium: If any premiums are refunded if coverage is not used

What to Consider Before Purchasing Long-Term Care Insurance

LTCI isn’t right for everyone. As you explore your options, consider:

• Your age and health—most policies are sold between ages 40–84
• Your desire to protect personal or family assets
• Your ability to afford premiums now and in the future
• Your family’s history or risk factors for chronic illness or cognitive decline

There’s no one-size-fits-all approach to long-term care. By understanding your choices and planning ahead, you can help ensure comfort, security, and peace of mind for yourself and your loved ones.