What Are Gross Long-Term Care Insurance Premiums?

Long-term care insurance is designed to cover the cost of healthcare services and facilities, such as nursing homes, that are needed for an extended period of time. It's important to understand how much your premiums are and how they might change over time when planning for long-term care. Understanding your gross long-term care premiums is an essential key to calculating your overall long-term care insurance costs.

An independent insurance agent can help you get set up with the right long-term care insurance policy if you're in need. Your agent can also help you understand the meaning of gross long-term care premiums and how your policy's rates work. But first, you can use our guide to long-term care premiums explained.

Table of Contents

Q. What Are Gross Long-Term Care Premiums?
Q. How Are Gross Long-Term Care Premiums Calculated?
Q. Are Gross Long-Term Care Premiums Tax-Deductible?
Q. How Can You Lower Your Long-Term Care Premiums?
Q. Can My LTC Premiums Increase Over Time?
Q. What Happens If I Stop Paying My LTC Policy's Premiums?
Q. How Can an Independent Insurance Agent Help?

What Are Gross Long-Term Care Premiums?

The definition of a long-term care (LTC) premium is the total amount paid before any deductions, such as refunds or dividends. LTC gross premiums differ from net premiums, which refer to the portion of the premium that the insurance company keeps after deducting expenses for return premiums, reinsurance, and its other operating expenses. An LTC policy's gross premiums include the cost of the net premium plus "loading," which refers to the insurance company's commissions, profit, and admin costs. 

How Are Gross Long-Term Care Premiums Calculated?

How LTC premiums are calculated starts with an insurance company evaluating the applicant's current age and health status. Other factors that affect long-term care insurance premium costs include the type of policy and coverage amount selected, whether the policy includes inflation protection, and the policy's elimination and benefit periods. An independent insurance agent can help you find affordable long-term care insurance near you.

Are Gross Long-Term Care Premiums Tax-Deductible?

Yes, LTC insurance premiums are tax-deductible if you meet the qualifications. Your policy's premiums must exceed 7.5% of your adjusted gross income to be tax-deductible, with slightly different rules for self-employed individuals. LTC tax benefits also come with limits on how much you can deduct based on your age. 

Long-term care insurance tax deduction limits 2025

How Can You Lower Your Long-Term Care Premiums?

When asking how to lower LTC premiums, you have several options, such as purchasing your policy at a younger age. Buying LTC insurance when you're younger and healthier can help you lock in lower premium rates. Because of this, it's typically recommended to purchase LTC insurance when you're in your 50s.

Common LTC insurance savings tips also suggest comparing multiple insurance companies and getting quotes from several insurers. You can experiment with changing your premium rate by adjusting a sample policy's elimination period and/or daily benefit amount. It can also help reduce your LTC costs if you buy a hybrid life insurance policy with a long-term care rider. An independent insurance agent can help you reduce your LTC premiums as much as possible without sacrificing coverage.

Can My LTC Premiums Increase Over Time?

Yes, unfortunately, LTC insurance premiums can increase over time. Not only can your policy's premiums increase as you age and your health worsens, but your rates can skyrocket due to inflation and the increasing costs of providing coverage by the insurance company. While you can buy LTC insurance with inflation protection included, the cost of this portion of your coverage can also increase over time, leading to higher premium rates.

Sadly, you can often expect policy premiums to increase by around 50% over time. However, you might be shocked to learn that rates can even spike by as much as 500%, according to the National Association of Insurance Commissioners (NAIC). 

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What Happens If I Stop Paying My LTC Policy's Premiums?

If you stop paying your LTC insurance premiums, your policy will lapse. The insurance company will attempt to get in contact with you to collect the payments you owe to keep your policy in force. Depending on the specifics of your policy, you might be able to retain some of your coverage benefits, depending on the amount of premiums you've already paid. To keep your coverage benefits fully active, your best bet is to make all of your premium payments on time.

How Can an Independent Insurance Agent Help?

Independent insurance agents have access to multiple long-term care insurance companies, so they're free to shop and compare policy options and quotes for you to find the best deal. They'll make sure you walk away with a policy that includes all the coverage you need from a reputable carrier. And down the road, your agent can help you file LTC insurance claims and update your coverage when necessary.