Long Term Care Insurance is not as expensive as many people think.  In fact, various options are available that can be used to customize a plan to fit specific needs and budgets.   The cost of coverage depends on a number of factors that come into play at the time you apply, including the following: 

• Your age.
• Your health.
• The amount of coverage you choose.
• The discounts available, such as preferred health discounts or married discounts (or even partner discounts available through certain companies).

Many people have found innovative ways to pay their Long Term Care Insurance premiums. Some of these ways include:

• Using a portion of the interest earned on any given asset.
• Using dividend income.
• Using the interest earned on any fixed or variable annuity. 

The ageless saying, "You get what you pay for," applies to the Long Term Care Insurance market as well.  Long Term Care Insurance is one insurance product for which you do not necessarily want to get the lowest rate.  There are over one hundred companies selling Long Term Care Insurance.  Out of those, only about ten are A+ rated and have paid over $100 million in claims. Out of those ten, some of the companies you would especially want to consider are Genworth Financial, John Hancock, MetLife, Mass Mutual, Prudential, and Mutual of Omaha.    

Consider the Cost of Waiting:

Many people assume that they will save money if they simply wait before buying Long Term Care Insurance.  Unfortunately, what they are not taking into account are the following factors that come in to play each year they wait: 

• They will have to purchase more insurance because the cost of health care rises each year.
• They will have to pay higher premiums each year they wait because premiums are based on the applicant's age.
• Their health could change, leaving them with a much higher premium, or even leaving them uninsurable. 

In the following scenario, Bill, age 50, purchases a Long Term Care Insurance policy from a major insurance carrier.  The policy includes the following: 

1. $4500 monthly benefit
2. 4-year benefit period
3. 90-day elimination period
4. Inflation protection

Bill's annual premium will be $1,638.75.  If he pays this annual premium until the age of 85, he will have paid a total of $57,330 in premiums.

Compare Bill's premiums if he waited five years:

If Bill waited just five years to purchase the same policy, his annual premium would be $2,374.37. If he paid this annual premium until the age of 85, he would have paid a total of $71,220 in premiums. 

The increased premium takes into account that Bill is now five years older, plus the cost of health care has increased.  By waiting five years, Bill would pay an additional $13,890 in premiums over his lifetime.  Not only that, Bill would risk being uninsured for those five years.

Can insurance companies increase my LTC Insurance rates?

This question comes up frequently.  The answer is a qualified, "Yes."  Insurance companies can increase your premiums if the increase is for an entire class of policyholders and if it is approved by your state's insurance commissioner.  By going with a financially strong company, however, the chances of this happening are less likely.