How Much Does Long-Term Care Insurance Cost?

Could you afford to enter a nursing home if you needed one? As you age, long-term care may become necessary if you suffer from poor health or otherwise can't care for yourself. Thankfully, traditional long-term care insurance can help you pay for it.

If you're in need of long-term care insurance, a local independent insurance agent can help you find the right policy. They can shop and compare coverage and rates from multiple carriers near you to find the best deal without sacrificing quality. But first, here's a closer look at how much you can expect to pay for long-term care insurance.

What Is Long-Term Care Insurance?

Long-term care insurance pays for long-term care services, which can be a nursing home, assisted living facility, or home health aide, should you ever need them. You pay monthly or yearly premiums in exchange for coverage.

There are two main types of long-term care insurance: traditional and hybrid. Traditional long-term care insurance is a stand-alone policy, while hybrid long-term care insurance is blended with life insurance. Both have their perks. A traditional long-term care policy is usually simpler and more streamlined than a hybrid policy.

Hybrid vs. Traditional Long-Term Care Insurance

There isn’t usually a significant difference in cost between hybrid and traditional long-term care insurance. The major difference is in the benefits:

Hybrid long-term care insurance

Hybrid long-term care insurance is a more recent type of long-term care insurance that is steadily growing in popularity. It combines life insurance coverage and annuity options with long-term care insurance. 

You pay premiums towards a death benefit, just like with life insurance, but have the option to “cash in” that benefit to pay for long-term care if you need it. This allows you to guarantee that you’ll get at least some benefit out of your long-term care insurance.

Traditional long-term care insurance

Traditional long-term care insurance is a stand-alone policy that's purchased and administered separately from other policies, such as life insurance. This means it’s more straightforward than a hybrid policy, which makes it easier to understand and plan around. You pay premiums toward the policy and file a claim if you ever need it.

The downside of a traditional policy is that you may never use it, meaning you paid premiums for no cash benefit. However, many individuals find that just knowing they have this coverage in place, should they ever need it, is a big enough benefit to make the cost worth it.

Long-term care insurance is an investment, so it’s important to make sure you’re making a good one. Many independent insurance agents are also certified financial planners. They’re experts who are well-equipped to help you make the right choice when it comes to your long-term care coverage.

How Much Does Traditional Long-Term Care Insurance Cost?

The current average cost of traditional long-term care insurance for a $165,000-benefit policy without inflation protection is $1,500 for a single 55-year-old female and $950 for a single 55-year-old male. For a male and female couple aged 55, the average annual combined premium rate increases to $2,080. 

The cost of traditional long-term care insurance is often based on three main factors:

• Your age: The younger you are, the cheaper coverage will be because you’re likely to have more years of paying premiums before filing a claim.
• The amount of daily benefit and years of coverage you choose: Choosing a policy with a lower benefit and fewer years of protection means cheaper premiums, but less overall coverage.
• Your location: Your state and its cost of living can also affect the cost of long-term care insurance.

An independent insurance agent can help you find affordable traditional long-term care insurance near you.

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How to Buy Traditional Long-Term Care Insurance

Buying traditional long-term care insurance is easier than you might think. Here’s how to do it, step by step:

1. Research the cost of long-term care in your area: Look for the average “per day” cost of care in your area, which is typically in the $100 to $300 range. 
2. Determine how much of that cost you’ll be able to pay from savings, etc.: Any difference in what you can afford needs to be covered by long-term care insurance.
3. Contact an independent insurance agent: They’re experts who can shop around and find quotes that make the most sense for your situation. If you’re undecided about buying long-term care insurance, they can help you compare hybrid and traditional options.
4. Fill out a medical history (and maybe get a medical exam): Your health status will affect the cost of premiums, so the insurance company will need to verify it before giving you a quote. You may be able to get this exam at home.
5. Find and compare several quotes: Your agent will gather several different quotes for you. The cheapest quote may not be your best option for coverage, so be sure to compare the size of the benefit and years of protection before choosing your policy.

Buying long-term care insurance is much easier when you enlist the help of an independent insurance agent. They can help walk you through the entire process and even file claims for you if the time comes.

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Why Work with an Independent Insurance Agent?

Independent insurance agents are free to shop and compare policies and rates from multiple carriers who offer coverage in your area. This means they can find you the best rates without sacrificing coverage or quality. And down the road, your agent will still be there to help you manage your policy and update your coverage when necessary.