Which long-term care insurance cost estimate is most accurate?
A quick search on the internet will yield a lot of different estimates regarding what one can expect to pay for long-term care insurance. Something that will quickly become apparent is that these estimates can vary from one another quite a lot. So, which one most closely reflects what you personally could expect to pay for a policy? That depends on your situation. This may seem like a frustratingly vague answer, but it’s important to understand that the cost of LTC insurance can vary drastically based on seemingly small details of the policy or the person buying it. This is why posts about the average cost of long-term care policies will often go into detail about the policy’s overall value, the length of its benefit and elimination periods, the amount of inflation protection it offers, the daily benefit it pays, and the age and marital status of the applicants. Every one of these factors plays an important role in determining the overall price of the policy.
For example, a policy from Genworth that covers a 55-year-old couple for three years with a $150 daily benefit and a 5% compound inflation rider would likely cost upwards of $6,700 in annual premiums. The exact same policy with only a 3% inflation rider would cost closer to $3,000. If the same couple waited another five years before applying for that 3% inflation policy, they could be looking at premiums of about $4,000 per year.
Which company issues your plan can also impact price to a surprising degree. A 2016 price comparison by the American Association for Long-Term Care Insurance found that rates could vary as much as 94% from one insurer to another, due in large part to how each company chooses to structure its plans and rates. This means that the company offering the best price for a 55-year-old applicant may not have good deals for someone who is 65, which is why it’s crucial to do your research and shop around.
Looking at estimates posted online can help give you a rough ballpark of what you will pay for a long-term care policy, but the best way to plan for your unique situation is to go ahead and get a few quotes. Contact us today to receive free, no-obligation quotes and start planning for your future long-term care needs.
How do long-term care insurance premiums vary by age?