Long-term care insurance should be considered at age 50 — MarketWatch
A 55-year-old woman whose mother had Alzheimer’s disease and spent seven years in a memory care facility began considering long-term care insurance for herself and her husband. As MarketWatch reports, the insurance company paid nearly $600,000 for her mother’s care.
Staying at the facility cost about $7,000 per month. The woman’s parents paid premiums for long-term care insurance policies for about 12 years. Her father’s policy was not used because he died shortly after being diagnosed with cancer. Her mother’s insurance, by contrast, effectively covered the cost of her care, while the family spent about $100 per month on additional needs.
Age and insurance terms
The author of the response in the column noted that at age 50, there is still time to compare insurers’ offers. Insurers may take into account a family history of dementia, heart and other age-related illnesses, as well as the applicant’s age and health condition.
According to AARP, the optimal age to take out such a policy is between 60 and 65. At the same time, waiting until age 65 carries a risk of rejection: it may be denied because of a person’s health condition or medical examination results indicating a high likelihood of needing long-term care.
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Personal savings or a policy
The cost of policies depends on age, health, benefit amount, inflation protection and other terms. The author advises clarifying how insurance premiums may be increased, as they do not necessarily remain unchanged under traditional plans.
The options mentioned include saving independently for long-term care, traditional insurance, or a combination of these approaches. Hybrid policies may combine life insurance with additional long-term care coverage or be based on an annuity structure. If the policyholder does not use the additional coverage, the residual value may become part of the inheritance.
It is also worth checking the waiting period before benefits begin: it may last 30, 60, 90 or 100 days, during which care is paid for out of pocket. Medicare generally does not cover ongoing long-term care, while Medicaid may pay for nursing home care for those who meet financial and medical criteria.
