The Washington Post

Is long-term-care insurance right for you?

1 Determine if you qualify financially

Don’t buy if the out-of-pocket cost for the coverage would be more than you can afford. Consumer Reports advises people that if their net worth, excluding their home, is below $300,000, long-term-care insurance is not a good buy for them. The National Association of Insurance Commissioners also recommends that consumers spend no more than 5 percent of their income on an LTC policy. If you need long-term care but have few financial resources, Medicaid should quickly kick in to pay, although that will probably limit your choices for care. On the other hand, if you have a lot of resources (some financial advisers put that threshold at $2 million), you may be able to self-insure and pay the costs as they arise, thereby eliminating the need to buy a policy.

2 Shop around

Comparison shopping is critical. Some companies and associations (such as alumni groups and AARP) offer group policies with relatively liberal eligibility, making it easier to obtain coverage if the policyholder has any health issues. However, these policies may have more limited benefits than individually purchased plans.

If you are young or in excellent health, a group plan may also be more expensive; you may end up paying more to subsidize your less healthy peers. And if you are certain you want LTC insurance, the younger you are, the better. Your annual premiums will be smaller, and you have less chance of being denied for health reasons.

3 Know what’s covered

Find out what services are covered. How long is the disability period before benefits kick in and what happens if you move from one facility to another? How much does the policy pay per day for nursing home care, home-health care and assisted living? How long will benefits last? Is there an inflation adjustment that anticipates rising medical costs as you age? How long are benefits extended (one, three or five years, or indefinitely)? Who determines benefit eligibility — your doctor, or the insurance company’s doctor — and on what basis? Are preexisting conditions excluded? Does the policy cover mental or nervous disorders, alcoholism, drug abuse or self-inflicted injuries?

The National Association of Insurance Commissioners advises consumers to look for policies that include at least one year of nursing home or home health care coverage, including intermediate and custodial care; coverage for Alzheimer’s disease; inflation protection; a guarantee that the policy cannot be terminated because you get older or your health deteriorates; no requirement that the beneficiary has to first be hospitalized to receive benefits and a 30-day cancellation period after purchase.

4 Check out the insurance company

Review a carrier’s record with your state insurance commissioner’s office. Find out how long it has been in business, its complaint record and history of raising rates. Stick with a company that has an A financial rating.

Also, the National Association of Insurance Commissioners and the American Association for Long-Term Care Insurance have consumer guides on their Web sites. The Department of Health and Human Services provides extensive information at

— Caroline Mayer



Success! Check your inbox for details. You might also like:

Please enter a valid email address

See all newsletters

Show Comments

Sign up for email updates from the "Confronting the Caliphate" series.

You have signed up for the "Confronting the Caliphate" series.

Thank you for signing up
You'll receive e-mail when new stories are published in this series.
Most Read



Success! Check your inbox for details.

See all newsletters

Your Three. Videos curated for you.
Play Videos
From clubfoot to climbing: Double amputee lives life of adventure
Learn to make traditional soup dumplings
In defense of dads
Play Videos
How to make head cheese
Perks of private flying
The rise and fall of baseball cards
Play Videos
Husband finds love, loss in baseball
New hurdles for a Maryland tradition
How to survive a shark attack
Play Videos
Portland's most important meal of the day
What you need to know about Legionnaires' disease
How to save and spend money at college

To keep reading, please enter your email address.

You’ll also receive from The Washington Post:
  • A free 6-week digital subscription
  • Our daily newsletter in your inbox

Please enter a valid email address

I have read and agree to the Terms of Service and Privacy Policy.

Please indicate agreement.

Thank you.

Check your inbox. We’ve sent an email explaining how to set up an account and activate your free digital subscription.