Long-Term Care Insurance Cost: Factors, Considerations and Price Ranges

Cost of Long-Term Care Insurance

Long-term Care Insurance usually costs around $1,000 - $2,000 per year, depending on the benefits within the policy, as well as your exact age and health status. Many Americans consider purchasing Long-Term Care Insurance in their 50s.

For perspective, the median cost of long-term care without insurance starts at $20,000 per year for occasional in-home care. This can range to over $100,000 for a prolonged nursing home stay. Plus, these costs increase every year.

The cost of long-term care can change depending on the type of care you need. Unfortunately, it's difficult to predict what type of care you'll need or when you'll need it.

Your Complete Guide to Long-Term Care Insurance Cost

That’s the short answer. But the longer one involves your gender, health and care concerns, policy details, and several other variables that we discuss below.

The bottom line, though, is that Long-Term Care Insurance helps people save thousands in potential care expenses. Insurance provides access to quality care services, protects savings, and eases stress on individuals and their families. 

LTC News works with licensed Long-Term Care Insurance specialists and other long-term care experts to answer common insurance questions—including how much a new policy could cost you. 

In this article, we'll break down the factors that affect the cost of Long-Term Care Insurance. We'll also explore hypothetical premium breakdowns to give you a better idea of how much your policy could cost. We work with all major Long-Term Care Insurance providers, to provide you with a range of premium and benefit options.

Why Do I Need a Long-Term Care Insurance Policy?

Since you’re here, you likely already see the need. But in brief:

1. Long-Term Care Insurance policies can protect your income and financial well-being as you or a loved one gets older and begins to need custodial care. This care is often extremely expensive. The cost of insurance is not nearly as high.

2. Long-term Care Insurance covers costs that traditional health insurance and Medicare won’t.

3. It allows you flexibility in care options, including in-home care or facility-based care.

4. More than anything, a policy can ensure your peace of mind for decades to come.

What Determines the Cost of Long-Term Care Insurance?

Many factors can affect the final cost of your Long-Term Care Insurance policy. The most impactful variables are: 

• Age
• Gender
• Marital status
• Health conditions
• Preferred coverage & benefits
• Location
• Other policy options & add-ons

We’ll break each of these down in the following sections. After discussing how companies determine policy costs, we’ll provide you with several examples of policy prices based on these variables.

Age of the Policyholder in Determining LTC Insurance Cost

Age is a major factor in determining the cost of Long-Term Care Insurance premiums. In general, the younger you are when you buy a policy, the lower your premium will be.

As we get older, we're more likely to develop a chronic condition leading to long-term health care. From an insurance company's perspective, older policyholders pose a greater risk to insure. This is why individuals who buy Long-Term Care Insurance at an older age tend to pay higher premiums.

On the other hand, those who apply when they're younger pose a lower risk to insurance companies. Younger individuals usually have good health and are less likely to need care immediately. Because of the lower risk, younger policyholders usually pay lower premiums.

So how old are younger and older policyholders? The average policyholder applies for an LTC Insurance policy in their 50s. Individuals in their 40s are considered younger, and those in their mid-60s and up are considered older. 

Here are a few examples of how age affects the cost of Long-Term Care Insurance:

1. On average, a 60-year-old married man pays $700 more annually than a 40-year-old married man with the same health status and benefits
2. A 70-year-old married man pays about $1,000 more annually than a 50-year-old married man with the same health and benefits. However, it may be difficult for the 70-year-old man to qualify for coverage at all.

It's important to note that many insurance providers won't consider new applicants older than 79 for new policies. From an insurer's perspective, these applicants are statistically too risky to insure. This is because a majority of people have or begin developing chronic health conditions by their late 70s.

Applicants Under 40 Years Old

It may not make sense at first, but some insurance companies don't accept applicants under 40. You may ask, "Why wouldn’t a company accept a perfectly healthy person who may not need care for years?" 

Similar to those 79 and older, applicants younger than 40 are too risky for companies to insure. Younger applicants may not need long-term health care often, but when they do, their cost of care is usually expensive.

This is because, on average, younger people have a life expectancy of several decades. Many Americans under 40 are also relatively healthy. If a younger policyholder filed a claim, it would most likely be due to a serious accident or the early onset of a chronic family illness. 

Insurance companies see this as a high risk because of younger applicants' high life expectancy. If a younger policyholder needed prolonged care, it could cost the insurance company millions.

Gender: How It Affects Long-Term Care Insurance Costs

Gender is another major factor that contributes to premium prices. In fact, women pay more for coverage than men, according to the American Association for Long-Term Care Insurance (AALTCI) 's price index

AALTCI studies have also shown that women tend to live longer, file more claims, and thrive better in care environments than most men. This may be why women pay up to hundreds of dollars more in Long-Term Care Insurance premiums.

We'll demonstrate the gender price difference in the table below. This example shows a specific standard LTC Insurance policy. This policy has $146,000 in total benefits, $3,000 in monthly benefits, and an annual compound inflation rider of 3%. The table includes both annual and monthly premiums. Some policies will break this down into a daily benefit as well, but benefits and costs are usually represented monthly, yearly, or in total.

How Gender Affects the Cost of the Same Policy in 2023

Approximate Monthly Premium	Approximate Annual Premium
Men (55 years old)	$91 – $142	$1,092 – $1,704
Women (55 years old)	$158 – $200	$1,896 – $2,400

Marital Status and Policy Types

Did you know that marital status can impact the cost of coverage? Individuals with spouses or partners tend to pay less for coverage than single individuals. Married or partnered individuals can even save hundreds on average compared to single applicants.

This is because couples may be eligible for discounts. Insurance companies offer these discounts for two main reasons: 

1. Insurance companies collect two premiums at once 
2. In a partnership, one partner may help provide some care for the other. This could delay a policyholder from seeking benefits. From an insurance company’s perspective, this alleviates the risk of either policyholder using their benefits quickly

To learn more about policies that can benefit both you and your significant other, contact a Long-Term Care Insurance professional.

Health Conditions: Can They Block a Long-Term Care Insurance Application?

Your health significantly impacts the cost of a Long-Term Care Insurance policy. 

Unlike health insurance, Long-Term Care Insurance is medically underwritten. This means LTC Insurance companies usually don't insure individuals with major health complications.

Insurance companies sort applicants by their health using a term called "rate classes." A rate class is a level of health assigned to each applicant at the time of application. Most insurance companies use three different rate classifications: 

• Preferred
• Standard
• Sub-standard

Rate classes affect how much your policy will cost. Those in the preferred category generally have the lowest rates, while those with sub-standard generally pay the most. Most applicants fall into the standard rate class, which means they’ll pay an average rate for LTC Insurance coverage. 

Each insurance company uses different criteria to determine rate classes. This means one company may assign you a different rate class than another, affecting the cost of your policy. 

Some insurance companies even combine the standard and preferred rate classes. Policies with a combined rate class may cost more than policies with separated classes. You can read our article on LTC Insurance rate classes and underwriting to learn more. 

How Do Health History & Other Health Conditions Impact Cost?

In addition to current chronic health conditions, your health history can also impact the cost of your policy. For example, individuals with a history of tobacco usage, excessive weight, or certain family health history may pay higher premiums. 

Once you’ve been issued a policy, the premium rate can never change based on changes to your health.

The Medical and Care Benefits Within Your Policy

When you first apply for Long-Term Care Insurance, you'll have to choose the amount of benefits within your policy. This decision has the most significant impact on the cost of coverage. 

Your benefits represent the amount of money your policy will pay toward care. These benefits can grow over time if you add an inflation rider. As you use benefits, the amount of money within the policy decreases. 

As you'd expect, the more benefits you add, the greater the premium. Policies with smaller benefit amounts have lower premiums. 

Some insurance companies offer unlimited benefit amounts. This means benefits within your policy can never run out. As you can imagine, this option is much more expensive than most other options. 

Does Location Change the Cost of an Insurance Policy?

Where you live can impact the cost of your Long-Term Care Insurance policy. More specifically, the cost of a policy varies depending on the state you live in. 

You may be wondering why prices vary by state. The answer can be complex. But it has a lot to do with how Long-Term Care Insurance companies file their products with state insurance departments. 

Companies must file their products with state insurance departments before they can sell a policy. Each state insurance department has a different filing process. This means insurance companies have to file separately in each state to sell policies to their residents. 

During this process, states can approve or decline an insurance company’s products. States can also influence how much each product will cost in that state. Policy prices can vary because of the flexibility and differences in regulation between states. However, moving states with an existing policy won’t affect your premium. 

Other Long-Term Care Insurance Options

Most insurance companies also offer different types of policies and add-ons. Choosing a specific policy type or add-on, also known as an insurance rider, can help you further customize your policy to fit your coverage needs.

It’s also important to note that these add-ons and alternative policy types may cost more than policies without add-ons. 

A few options include:

• Insurance riders & add-ons 
• Hybrid Long-Term Care Insurance policies

Insurance Riders & Add-ons: Costs & Considerations

An insurance rider is an add-on that provides extra benefits to traditional Long-Term Care Insurance policies. Riders usually increase your premium, and some may cost more than others. 

The most common rider is an inflation rider. All insurance companies must offer at least a 5% inflation rider under section federal law under Section 7702(b).

Inflation riders increase the benefits in your policy each year without raising your premium. They allow your benefits to keep up with the increasing cost of long-term care services. 

Other common riders include shared spousal benefits and cash benefits. Each insurance company may offer slightly different options. Check out our article on Long-Term Care Insurance riders for more information. 

Hybrid Long-Term Care Policies

Hybrid policies combine Long-Term Care Insurance with life insurance policies or annuities. These policies cover long-term health care and pay a death benefit to your designated beneficiary. 

Just like traditional policies, the cost of a hybrid policy depends on many factors. Hybrid policies usually cost more than traditional policies. The price reflects the product: which bundles two types of insurance. However, hybrid premiums can never increase because they're contractually locked. 

Hybrid policies can be paid for upfront with a single premium, ranging between $60,000 to $200,000 (occasionally more). There's also an option to pay premiums annually for 5, 10, or 20 years or over a lifetime. 

RELATED: Types of Long-Term Care Insurance Policies & Which Is Best For You?

What Will My Long-Term Care Insurance Policy Cover?

You know about the factors that affect cost now. So what will your LTC Insurance policy cover?

Long-Term Care Insurance covers a comprehensive array of long-term care services. These services can include adult day care, in-home care, homemaker services, facility-based care in assisted living, memory care or nursing home facilities. It can also cover hospice and respite care, physical or speech therapy, and skilled care.

That is not a comprehensive list, but it covers the most typical applications of Long-Term Care Insurance. To read a full description of coverages, check out our comprehensive article on Long-Term Care Insurance and what it covers.

Tax Incentives in Long-Term Care Insurance

Did you know that your Long-Term Care Insurance premium can be tax deductible? The federal and some state governments offer tax incentives to encourage people to get coverage. In addition, the benefits paid out by policies are always tax-free. 

The most common tax incentive is a tax deduction. Deductions can reduce your annual tax liability by hundreds or even thousands of dollars each year. However, only policies that meet federal guidelines are eligible for a tax deduction.

If that sounded confusing—don't worry. We created a Long-Term Care Insurance Tax Guide to help you understand your policy's tax incentives. 

If your policy is tax-deductible, then good news for you! Here are the tax deduction limits for 2024:

Tax Deductions By Age in 2024

Age	Tax Deductible Limit
40 or less	$470
41 - 50	$880
51 - 60	$1,760
61 - 70	$4,710
Older than 70	$5,880

The IRS also offers more information regarding taxes and tax deductions. 

What Will You Pay for Long-Term Care Insurance? 

Long-Term Care Insurance costs vary from person to person. Many variables, including your health, and family history, affect your premium price. 

Because prices are so individualized, we can’t provide an exact premium price estimate for your specific situation. However, we can help you visualize the cost of coverage with a few examples.

We've included two policy examples below, one with no inflation rider and one with a 3% compound inflation rider. Compound inflation riders increase the benefits within a policy by a given amount each year to help offset inflation. Most people add inflation riders to their policies today.

We'll also provide examples for different ranges in this article. You can scroll down to see these examples.

Approximate Monthly Premium With No Inflation Rider at Age 50

$3,000 monthly benefit, $108,000 benefit account, 90-day elimination period, no inflation	Married male with preferred health Age 50	Married female with preferred health Age 50
Company A	$32.59	$48.60
Company B	$34.20	$49.98
Company C	$42.50	$63.56
Company D	$49.63	$70.08
Company E	$50.00	$75.00

Approximate Monthly Premium With A 3% Compound Inflation Rider at Age 50

$3,000 monthly benefit, $108,000 benefit account, 90-day elimination period, 3% compound inflation	Married male with preferred health Age 50	Married female with preferred health Age 50
Company A	$68.40	$115.18
Company B	$77.01	$127.61
Company C	$90.08	$148.50
Company D	$125.00	$187.12
Company E	$134.53	$225.20

Please note: Monthly premium prices are based on annual premium prices. Annual premiums may be less expensive.

RELATED: Will Long-Term Care Insurance Premiums Increase?

Examples of the Cost of LTC Insurance for Other Age Ranges

Are you curious about how much premiums cost at other age ranges? The links below will jump to data tables at the end of this article. These tables show Long-Term Care Insurance policy price examples from ages 45 to 65. 

Examples for age 45:

• 1a) Approximate monthly premium costs with no inflation benefit
• 1b) Approximate monthly premium costs with 3% compound inflation

Examples for age 50:

• 2a) Approximate monthly premium costs with no inflation benefit
• 2b) Approximate monthly premium costs with 3% compound inflation

Examples for age 55:

• 3a) Approximate monthly premium costs with no inflation benefit
• 3b) Approximate monthly premium costs with 3% compound inflation

Examples for age 60:

• 4a) Approximate monthly premium costs with no inflation benefit
• 4b) Approximate monthly premium costs with 3% compound inflation

Examples for age 65:

• 5a) Approximate monthly premium costs with no inflation benefit
• 5b) Approximate monthly premium costs with 3% compound inflation

A Recap of Long-Term Care Insurance Costs

As we've discussed, many factors affect your final premium cost. Regardless of your policy's cost, you can save hundreds by planning for long-term health care with insurance. 

Long-Term Care Insurance can give you the peace of mind you need to live a long, happy life. It can protect your finances from out-of-pocket long-term health care costs. This protection can reduce stress and give your loved ones time to be family instead of caregivers. 

Policy costs will depend on a variety of factors specific to your situation. The amount of benefits within your policy and your health will impact the cost the most.

Because health is a deciding factor in the overall policy cost, you should consider insurance while you're young and healthy. Applying for coverage while younger will also help you keep your costs down. You can read the tables below for more information on policy costs by age. 

How Much Does Long-Term Care Insurance Cost Based on Your Age Range?

All monthly premium prices are based on the annual premium cost. 

Example 1a: Approximate Monthly Premium With No Inflation Rider at Age 45

$3,000 monthly benefit, $108,000 benefit account, 90-day elimination period, no inflation.	Married male with preferred health Age 45	Married female with preferred health Age 45
Company A	$28.72	$41.40
Company B	$28.83	$44.81
Company C	$37.58	$55.83
Company D	$45.08	$61.75
Company E	$45.40	$66.55

Example 1b: Approximate Monthly Premium With A 3% Compound Inflation Rider at Age 45

$3,000 monthly benefit, $108,000 benefit account, 90-day elimination period, 3% compound inflation.	Married male with preferred health Age 45	Married female with preferred health Age 45
Company A	$63.07	$104.33
Company B	$69.88	$114.99
Company C	$82.75	$135.83
Company D	$129.18	$179.31
Company E	$132.60	$233.40

Example 2a: Approximate Monthly Premium With No Inflation Rider at Age 50

$3,000 monthly benefit, $108,000 benefit account, 90-day elimination period, no inflation.	Married male with preferred health Age 50	Married female with preferred health Age 50
Company A	$32.59	$48.60
Company B	$34.20	$49.98
Company C	$42.50	$63.56
Company D	$49.63	$70.08
Company E	$50.00	$75.00

Example 2b: Approximate Monthly Premium With A 3% Compound Inflation Rider at Age 50

$3,000 monthly benefit, $108,000 benefit account, 90-day elimination period, 3% compound inflation.	Married male with preferred health Age 50	Married female with preferred health Age 50
Company A	$68.40	$115.18
Company B	$77.01	$127.61
Company C	$90.08	$148.50
Company D	$125.00	$187.12
Company E	$134.53	$225.20

Example 3a: Approximate Monthly Premium With No Inflation Rider at Age 55

$3,000 monthly benefit, $108,000 benefit account, 90-day elimination period, no inflation.	Married male with preferred health Age 55	Married female with preferred health Age 55
Company A	$37.83	$59.44
Company B	$45.00	$64.80
Company C	$51.67	$76.61
Company D	$57.56	$85.25
Company E	$58.80	$88.60

Example 3b: Approximate Monthly Premium With A 3% Compound Inflation Rider at Age 55

$3,000 monthly benefit, $108,000 benefit account, 90-day elimination period, 3% compound inflation.	Married male with preferred health Age 55	Married female with preferred health Age 55
Company A	$81.00	$134.78
Company B	$85.84	$144.15
Company C	$102.25	$168.75
Company D	$125.20	$204.41
Company E	$142.64	$226.00

Example 4a: Approximate Monthly Premium With No Inflation Rider at Age 60

$3,000 monthly benefit, $108,000 benefit account, 90-day elimination period, no inflation.	Married male with preferred health Age 60	Married female with preferred health Age 60
Company A	$46.62	$74.88
Company B	$54.00	$81.00
Company C	$62.75	$100.91
Company D	$72.13	$103.67
Company E	$74.00	$110.60

Example 4b: Approximate Monthly Premium With A 3% Compound Inflation Rider at Age 60

$3,000 monthly benefit, $108,000 benefit account, 90-day elimination period, 3% compound inflation.	Married male with preferred health Age 60	Married female with preferred health Age 60
Company A	$91.80	$154.71
Company B	$98.92	$168.41
Company C	$113.17	$190.67
Company D	$135.40	$237.50
Company E	$159.32	$239.17

Example 5a: Approximate Monthly Premium With No Inflation Rider at Age 65

$3,000 monthly benefit, $108,000 benefit account, 90-day elimination period, no inflation.	Married male with standard health Age 65	Married female with standard health Age 65
Company A	$79.67	$125.48
Company B	$90.00	$128.87
Company C	$92.83	$136.00
Company D	$94.31	$150.20
Company E	$99.20	$151.75

Example 5b: Approximate Monthly Premium With A 3% Compound Inflation Rider at Age 65

$3,000 monthly benefit, $108,000 benefit account, 90-day elimination period, 3% compound inflation.	Married male with standard health Age 65	Married female with standard health Age 65
Company A	$132.30	$224.40
Company B	$146.04	$244.32
Company C	$149.42	$244.33
Company D	$159.00	$273.25
Company E	$187.22	$276.80

Disclaimer: You may have noticed the 65+ bracket has a standard premium instead of a preferred rate. We changed this because it’s relatively rare for individuals to get a preferred rate at this age.

Long-Term Care Cost Without Insurance

The average cost of long-term care can range between $20,000 to over $100,000 per year, depending on the type of care needed and the state you live in. These costs continue to increase every year.

This should put the cost of Long-Term Care Insurance into perspective. Even if you or a loved one only needs care for a handful of years, the cost of insurance will pay for itself many times over.

If you want to see estimated costs for your state both now and into the future, check out our Cost of Care Calculator.

Common Cost Questions

Doesn’t Medicare cover the cost of long-term care?

Medicare will pay only for skilled care up to 100 days. It is not a viable option to cover long-term care costs.

Will my health insurance cover long-term care costs?

Traditional health insurance will not cover long-term care costs. Most policies cover only up to 100 days of skilled care. More importantly, it will not pay for custodial care, which is what many people will need. Long-Term Care Insurance is necessary to cover these services, particularly for anything related to ongoing care.

When is the right time to buy Long-Term Care Insurance?

Typically, most Americans purchase Long-Term Care Insurance in their 50s. It can be purchased as early as your 40s, though as we discussed earlier, many providers will actually deny coverage to anyone under 40.

In some states considering the so-called long-term care tax, younger adults are considering Long-Term Care Insurance to avoid the tax and thus also protect their 401(k).

There isn’t a single “right” time to buy Long-Term Care Insurance, but the sooner you act, the lower the cost will be. If you are currently in good health, this gives you the opportunity to plan ahead and save on premium costs.

Summary and Key Takeaways

Wrapping up, here are some of the key takeaways that you should take into a discussion with a trusted Long-Term Care Insurance Specialist:

1. The yearly cost of Long-term Care Insurance policy varies, but average cost is usually between $1,000 and $2,000 per year. This can vary depending on factors mentioned below, and means that the most expensive premiums may be outside this range.
2. Your age, gender, and the specific benefits of your policy will be among the biggest factors that affect cost.
3. Typically adults obtain Long-term Care Insurance in their 50s, but it can be purchased as early as your 40s (some insurance companies will consider even younger) and can often cost less when you act earlier.
4. Long-Term Care Insurance covers costs of care that Medicare and traditional health insurance won’t.
5. The best way to obtain an exact quote on insurance is to speak to a Long-Term Care Insurance Specialist. They can represent numerous providers to present you with enough options to make an informed decision.

When you’re ready to act, LTC News has help! We don’t sell insurance, but can assist in helping you find a specialist who can walk you through the process. They'll answer any questions you have, and help you to choose a policy that matches your budget and long-term care goals.

Long-term care coverage is important for your peace of mind, and the financial and emotional stability of your loved ones. Click below to start your journey to great long-term health!