The question of whether or not to buy long-term care insurance perplexes many people. They don’t know how to approach the issue and don’t want to be led around by an insurance agent seeking a commission. If you’re in that situation, or simply want a decent road map to analyzing the decision, consider this post. It covers many of the issues we discuss in detail in Retirement Watch. It’s not a complete discussion, of course. But for those who simply don’t know where to start or need a template to organize their thoughts, it should be a big help.
Will you need long-term care? Almost seven of every ten of us will need some sort of personal assistance after age 65, and we’ll need that help for an average of about three years. For many people, however, the assistance needed will be relatively modest, can be provided by family members and might not be covered by LTC insurance anyway. That’s because to qualify for LTC benefits you must need help with at least two of five “activities of daily living,” such as getting in and out of bed, bathing, dressing, eating or going to the bathroom. What’s more, you’ll need it for an extended period, since policies typically don’t cover the first 90 days of care. On the other hand, 20% of seniors will need care for five years or more, and 5% will spend more than $100,000 of their own money on this assistance.