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How Much Does Long-Term Care Insurance Cost?

Many of us wonder how much Long-Term Care Insurance costs. Several variables affect Long-Term Care Insurance premium prices. Let’s break down these variables, and explore hypothetical price breakdowns.

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Many Americans consider Long-Term Care Insurance in their 50s. For those who purchase in their 50s, Long-Term Care Insurance costs between $1,000 - $2,000 per year depending on the amount of benefits in the policy. But there are several factors that affect how much you pay for Long-Term Care Insurance.

For perspective, the median cost of long-term health care without insurance can range from $20,000 per year for occasional in-home care to over $100,000 for a nursing home stay.

The cost of long-term health care will vary greatly depending on the type of care you need, and unfortunately, that need isn’t something most people can predict. Long-Term Care Insurance helps individuals save thousands in potential care expenses, provides access to quality care services, protects savings, and eases stress on individuals and their families. 

In this FAQ article, we’ll break down the factors that affect the cost of Long-Term Care Insurance and explore hypothetical price breakdowns.

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.

Age of the Policyholder

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 premiums will be. 

The risk of needing long-term health care increases with age. This makes older policyholders a higher risk for insurance companies; therefore, older individuals tend to have more expensive premium prices. Younger policyholders initially pose a lower risk to insurance companies; therefore, they usually pay lower premium prices.

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 and benefits.

  2. A 70-year-old married man would pay about $1,000 more annually than a 50-year-old married man with the same coverage. 

The latter example assumes that the 70-year-old qualifies for Long-Term Care Insurance, which may be challenging. It’s important to note that many insurance carriers refuse to insure new applicants over the age of 75. Applicants above this age generally pose too much of a risk to insurance companies. 

Gender

Another factor in calculating insurance premiums is the applicant's gender. Studies have shown that women tend to live longer and file more claims than men. As a result, women may pay up to hundreds of dollars more in Long-Term Care Insurance premiums

For example, the average 55-year-old married man will pay approximately $1,092 – $1,704 each year—or about $91 - $142 each month—for a plan that covers up to $146,000 in benefits, with 3 percent compound inflation. 

Women tend to pay about $1,896 - $2,400 each year—about $158 - $200 each month—for the same policy. 

Marital Status

Some people may be surprised to learn that marital status can impact coverage. Married couples, or those in partnerships, are eligible for some discounts, so they tend to pay less for Long-Term Care Insurance than single individuals. Compared to single applicants, on average, couples can save hundreds.

These discounts are offered for two main reasons:

  1. Insurance companies collect two premiums at once. 

  2. In a partnership, the other partner may help provide some care, alleviating the risk of using up Long-Term Care Insurance benefits quickly.

Health Conditions

Health can have a large impact on Long-Term Care Insurance costs. Applicants with standard health will pay a standard premium rate. Applicants in preferred health typically pay less than a standard rate for the same amount of benefits. 

Preferred health means the applicant does not have any major health ailments based on the company’s specific underwriting standards. Preferred health standards vary by company. 

Applicants in preferred health are eligible for discounts that lower their rates. Some insurance companies offer as much as a 15% discount or more to applicants with preferred health. 

However, if you don't qualify for a preferred health discount or a standard policy due to chronic or pre-existing conditions, you may have other options. 

Sub-Standard Rates

Some insurance companies offer sub-standard rates for individuals who may not qualify for standard policies. Sub-standard rates are more costly than standard rates. 

In some cases, sub-standard rates can increase the cost of a premium by 25%-50% or more. Sub-standard premiums are more expensive due to a higher level of perceived risk to insurance companies. 

Statistically speaking, individuals with chronic health conditions have a greater likelihood of needing long-term health care. Companies must address that significant risk by charging higher premiums.

Other Pre-Existing Health Conditions

In addition to chronic health history, individuals with a history of tobacco usage, excessive weight, or family health history should expect variance in their premiums. 

Once your policy is issued, the premium rate can never change based on your future changing health. 

Your Preferred Long-Term Care Insurance Coverage & Benefits

Possibly the most significant part of Long-Term Care Insurance cost is the amount and type of benefits you wish to include in your plan. 

Today, a majority of Long-Term Care Insurance policies are comprehensive - meaning most plans cover:

  • In-home care (skilled, semi-skilled, and homemaker services)

  • Adult day care centers

  • Assisted living facilities

  • Memory care facilities

  • Nursing homes

  • Hospice

Many Long-Term Care Insurance companies use a benefit period to calculate the amount of money within a policy. This benefit period is essentially the minimum amount of time that policyholders are guaranteed benefits.

Benefit periods are typically two, three, or five years. In most cases, benefits last longer since most people will not use the maximum amount available each day/month when they first need care services. You’ll have access to your benefits until there is no money left in your policy.

There are still a few companies that offer unlimited lifetime benefits. This means you could never exhaust your benefits. These unlimited plans come with a larger price tag. Generally, the longer the benefit period, the greater the cost

Location

Long-term health care costs can vary from state to state. Long-Term Care Insurance companies are required by law to file their products and pricing with the department of insurance in each state. 

Each state’s insurance department has different guidelines for approving insurance rates. This is why the same policy may be more expensive in one state than in another.

The costs of care are also higher in some areas. However, this does not have a direct impact on insurance premium prices.

Other Long-Term Care Insurance Options

Most insurance companies also offer different policy types and add-ons for those looking for features outside of traditional Long-Term Care Insurance policies. These can range from simple add-ons to combined life insurance policies. Add-ons and alternative policy types add an additional cost to the premium.

A couple of options include:

  • insurance riders & add-ons

  • hybrid policies

Insurance Riders & Add-ons

An insurance rider is an add-on to a traditional Long-Term Care Insurance policy that provides extra benefits for an additional cost. All LTC Insurance companies offer riders at an additional cost, although some may cost more than others.

The most common add-on is an inflation rider, which must be offered by federal law under Section 7702(b). Inflation riders increase your benefits each year to address the ever-increasing cost of long-term health care services. 

With inflation riders, policyholders can select a guaranteed percentage increase for benefits to raise each year. Some insurance companies will increase the premium as your benefits increase, or offer options to buy additional benefits. 

Other common riders include: 

  • shared spousal benefits

  • cash benefits

  • restoration benefits 

Each insurance company may offer slightly different options. For more information on insurance riders, it’s best to consult with a Long-Term Care Insurance specialist.

Hybrid Policies

A hybrid policy combines Long-Term Care Insurance with a life insurance policy or annuity. These hybrid, or linked benefit, policies will pay a death benefit to a beneficiary. 

Hybrid policies are completely different from traditional Long-Term Care Insurance policies, and will not be eligible for partnership programs. However, hybrid policies are not the same as traditional life insurance policies.

Premium prices depend on your age, gender, inflation options, death benefits, and long-term care benefits. These policies are more expensive than traditional policies since they bundle two types of insurance. However, hybrid policies can never increase during your policy length.

Hybrid policies can be paid for with a single premium, which can range anywhere between $60,000 to $200,000 or more. Policyholders can also spread out the expense by paying premiums annually for 5, 10, or 20 years or over their lifetime.

To find a hybrid policy that best fits your needs, it’s best to meet with a Long-Term Care Insurance specialist. 

RELATED: Long-Term Care Planning Resources: LTC Specialists vs. Financial Advisors

Tax Deductions

Did you know that your Long-Term Care Insurance premium can be tax deductible? The federal government and some states offer tax incentives to encourage individuals to purchase coverage. Plus, benefits from a Long-Term Care Insurance policy are always tax-free.

Tax deductions on Long-Term Care Insurance policies can reduce your annual tax liability by hundreds to thousands of dollars.

However, not everyone qualifies for a tax deduction. Only tax-qualified Long-Term Care Insurance policies that meet federal guidelines are eligible. 

If that sounded confusing—don’t worry. There’s a Long-Term Care Insurance Tax Guide to help you fully understand tax deductions and tax-qualified policies for Long-Term Care Insurance. 

If your policy is tax-deductible, then good news for you! Here are the tax deduction limits for 2022:

Age Tax Deductible Limit
40 or less $450
41 - 50 $850
51 - 60 $1,690
61 - 70  $4,520
Older than 70 $5,640


The IRS also has more information regarding tax deductions for tax-qualified Long-Term Care Insurance policies

The Cost of Long-Term Care Insurance? 

Long-Term Care Insurance costs vary from person to person. It’s nearly impossible to give someone a definitive amount that they’ll pay for care without knowing their specific situation. There are far too many variables that affect cost.

That being said, we can visualize Long-Term Care Insurance coverage with a few examples. There are two 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. In the examples below, the amount of benefits would increase by 3% each year.

We’ll also provide examples for additional age ranges at the end of this article. We’ll include links at the end of this section that will allow you to jump ahead to specific examples that you’d like to view.

Example 2a: Annual Premium With No Inflation at Age 50

$3,000 monthly benefit, $108,000 benefit account, 90-day elimination period, no inflation.  Married Male with standard health Age 50 Married Female with standard health Age 50
Company A $391.10 $583.20
Company B $410.40 $599.80
Company C $510.00 $762.75
Company D $595.50 $841.00
Company E $600.00 $900.00

Example 2b: Annual Premium With 3% Compound Inflation at Age 50

$3,000 monthly benefit, $108,000 benefit account, 90-day elimination period, 3% compound inflation.  Married male with standard health Age 50 Married female with standard health Age 50
Company A $820.80 $1,382.18
Company B $924.17 $1,531.29
Company C $1,081.00 $1,782.00
Company D $1,500.00 $2,245.43
Company E $1,614.31 $2,702.40

Please note: The premiums in the tables above are filed with and approved by each state’s insurance department. In most cases, premiums will follow those provided above. However, some variations may occur depending on the company, age, underwriting, location, health, and specific situation. 

Long-Term Care Insurance is a highly regulated industry. This means no insurance agent, agency, or advisor can give special deals or raise premiums on their own. The only way an insurance company can offer a deal or raise a premium is through the approval of the state’s insurance department.

Examples of the Cost of LTC Insurance for Other Age Ranges

Looking for the cost of premiums for other age ranges? Click the links below to jump ahead to the example tables at the end of this article. We also include the age 50 examples below for easy comparison.

Examples for age 45:

Examples for age 50:

Examples for age 55:

Examples for age 60:

Examples for age 65:

Co-Insuring Future Long-Term Health Care Costs 

Long-Term Care Insurance policies and benefits are customizable. Some policyholders use that customization to their advantage by designing policies that combine insurance benefits with pre-existing income. 

This allows policyholders to pay for care through a combination of pre-existing income, future or current pensions, and social security benefits. This combination strategy often keeps premiums lower for individuals, while still allowing them to protect their assets, lifestyle, and legacy.

A Recap of Long-Term Care Insurance Costs

As we’ve discussed, many factors go into deciding the final premium cost. Regardless of your premium price, tax deductions and proper planning can help you save hundreds on a policy. 

Many Americans obtain Long-Term Care Insurance in their 50s. At this age, care costs somewhere between $1,000 - $2,000 depending on the total amount of benefits and asset protections within the policy. 

It’s also important to consider Long-Term Care Insurance while you’re young and in good health. Each insurance company has a different set of underwriting rules, but in most cases, you must be in reasonably good health to get an affordable policy. 

Overall, your LTC Insurance premium price will depend on your situation. Long-Term Care Insurance not only protects income, savings, and assets but also gives you access to your choice of quality care services at an affordable price. These protections can reduce stress and give your loved ones time to be family instead of caregivers. 

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

Example 1a: Annual Premium With No Inflation at Age 45

$3,000 monthly benefit, $108,000 benefit account, 90-day elimination period, no inflation.  Married Male with standard health Age 45 Married Female with standard health Age 45
Company A $344.67 $496.80
Company B $346.00 $537.75
Company C $451.00 $669.98
Company D $540.98 $741.00
Company E $544.80 $798.60

Example 1b: Annual Premium With 3% Compound Inflation at Age 45

$3,000 monthly benefit, $108,000 benefit account, 90-day elimination period, 3% compound inflation.  Married male with standard health Age 45 Married female with standard health Age 45
Company A $756.86 $1,251.94
Company B $838.58 $1,379.88
Company C $993.00 $1,630.00
Company D $1,550.19 $2,151.69
Company E $1,591.20 $2,798.40

Example 2a: Annual Premium With No Inflation at Age 50

$3,000 monthly benefit, $108,000 benefit account, 90-day elimination period, no inflation.  Married Male with standard health Age 50 Married Female with standard health Age 50
Company A $391.10 $583.20
Company B $410.40 $599.80
Company C $510.00 $762.75
Company D $595.50 $841.00
Company E $600.00 $900.00

Example 2b: Annual Premium With 3% Compound Inflation at Age 50

$3,000 monthly benefit, $108,000 benefit account, 90-day elimination period, 3% compound inflation.  Married male with standard health Age 50 Married female with standard health Age 50
Company A $820.80 $1,382.18
Company B $924.17 $1,531.29
Company C $1,081.00 $1,782.00
Company D $1,500.00 $2,245.43
Company E $1,614.31 $2,702.40

Example 3a: Annual Premium With No Inflation at Age 55

$3,000 monthly benefit, $108,000 benefit account, 90-day elimination period, no inflation.  Married Male with standard health Age 55 Married Female with standard health Age 55
Company A $453.96 $713.30
Company B $540.00 $777.60
Company C $620.00 $919.28
Company D $690.75 $1,023.00
Company E $705.60 $1,063.20

Example 3b: Annual Premium With 3% Compound Inflation at Age 55

$3,000 monthly benefit, $108,000 benefit account, 90-day elimination period, 3% compound inflation.  Married male with standard health Age 55 Married female with standard health ge 55
Company A $972.00 $1,617.41
Company B $1,030.04 $1,729.74
Company C $1,227.00 $2,025.00
Company D $1,502.40 $2,452.88
Company E $1,711.65 $2,712.00

Example 4a: Annual Premium With No Inflation at Age 60

$3,000 monthly benefit, $108,000 benefit account, 90-day elimination period, no inflation.  Married Male with standard health Age 60 Married Female with standard health Age 60
Company A $559.42 $898.56
Company B $648.00 $972.00
Company C $753.00 $1,210.88
Company D $865.58 $1,244.00
Company E $888.00 $1,327.20

Example 4b: Annual Premium With 3% Compound Inflation at Age 60

$3,000 monthly benefit, $108,000 benefit account, 90-day elimination period, 3% compound inflation.  Married male with standard health Age 60 Married female with standard health Age 60
Company A $1,101.60 $1,856.52
Company B $1,1187.09 $2,020.86
Company C $1,385.00 $2,288.00
Company D $1,624.80 $2,850.00
Company E $1,911.83 $2,870.04

Example 5a: Annual Premium With No Inflation 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 $956.05 $1,505.81
Company B $1,080.00 $1,546.49
Company C $1,114.00 $1,632.00
Company D $1,131.75 $1,802.40
Company E $1,190.40 $1,821.00

Example 5b: Annual Premium With 3% Compound Inflation 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 $1,587.60 $2,692.80
Company B $1,752.43 $2,931.80
Company C $1,793.00 $2,932.00
Company D $1,908.00 $3,278.96
Company E $2,246.63 $3,321.60

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