Do You Really Need Long Term Care Protection? (and if so, what is the right age to secure it?)

Your decision to plan for the likelihood of an extended illness is a very personal one.  We each have our own sense of how we should protect our family’s financial security, and quite frankly, our quality of life. Even within the long term care (LTC) planning community, there is debate about who should consider LTC insurance and at what age it should be considered. And of course, what options and levels of protection might be best. The goal of this article is not to make that decision FOR you but to equip you with the facts that can help you make an informed decision for yourself.

There is no legal requirement that you protect yourself from this financial loss or take any planning action whatsoever. People that secure LTC Insurance tend to be concerned about their family’s financial security, preserving their dignity, and the level of personal care they can receive should have an extended illness or period of frailty occur.

What is Long Term Care?

Long Term Care refers to the personal assistance with your activities of daily living, (dressing, bathing, eating, toileting…etc.), that you may need during a period of healing, illness, injury, or the normal frailties from advancing age. This need for “special assistance” can happen to us at any age, and with little or no advanced warning. And of course, the chance of such an occurrence increases dramatically the longer we live. Most health insurance plans, including Medicare, pay very little or no benefit towards the cost of this personal ongoing assistance.

What does Long Term Care Cost?

The personal out-of-pocket costs for getting this type of professional personal care typically range from about $50,000 to $150,000 per year, (today’s dollars), and can last for many years. Think about people you know who have been critically injured in an accident or who are recovering from a stroke or suffering from Alzheimer’s. These costs can add up quickly and have an irreversible consequence on your savings.

Long term care is the number one cause of impoverishment for people over the age of 65. Again, most health insurance plans, including Medicare, pay little or nothing towards the cost of this personal ongoing assistance.

Types of Long Term Care Insurance.

The LTC Insurance industry has evolved and learned since its beginnings about 50 years ago. This evolution in product design has made it very advantageous to secure this protection at your youngest age possible.

As an LTC expert of more than 35 years, my advice is to secure LTC insurance at an age where you understand the importance of this protection, and have the financial ability to set aside a small amount of money for your future. This is because your cost (or premium)will be the lowest it will ever be. And, even more importantly, you’re most likely to be able to qualify for standard or preferred health rate class. To secure this protection, you must qualify medically to have coverage issued. Whether or not you qualify, is at the sole discretion of the insurance company.

Once your insurance policy is issued, the Insurance Company cannot change your premium, your benefits, or cancel your policy due to your future changing age and or health. If you choose to, you can even actually lock in and guarantee your premiums and benefits for the rest of your life. This is a very powerful hedge against the unknown.

In the new generation of long term care plans, there are options where your premiums can be fixed and guaranteed never to increase. What is more, benefits are available immediately at any age and premiums stop when benefits are being paid or when you reach a certain age. For example, age 95. In this case, At age 95, the policy is considered paid up and remains in force until death or the benefits are exhausted. Some policies also provide a death benefit and/or cash value if the long term care benefits are not used up.

Why it pays to do it when you are young;

There are three reasons why we recommend people secure protection as young as possible:

  1. You may not qualify for coverage later due to unexpected illness or injury
  2. Money
  3. Math

Here is an example of how math and money work in real life: 

If a 50-year-old male who purchased long term care insurance today with a $500,000 benefit, needed to use his benefits at age 85, he would have paid a total of approximately $136,500 in premiums spread out over 35 years. Whereas if he waited until he was 65 to purchase the insurance – presuming he would still be in good enough health to qualify for it— at age 85 he would have paid a total of $219,000 over 20 years.  That is a difference in cost of $82,500 (62% more) for the same $500,000 coverage!

If that same 50-year-old purchasing insurance today didn’t need to use his benefits until age 95, his total cost would be $175,500 over 45 years compared to $328,500 over 30 years by waiting until he was 65 to secure protection. That is a $153,000 (87% more) reason for looking at insurance options as early as possible.


As with all of life’s challenges…

– individuals who have planned in advance are always in a significantly better position than those who have not.


Michael Teller, CLTC, CSA

“Certified in Long Term Care”  “Certified Senior Advisor”