8 smart questions to ask before buying long-term care insurance


Senior man in rocking chair on front porch
Be sure to ask the right questions before purchasing a long-term care insurance policy.

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When preparing for retirement, the focus tends to be on your finances. After all, you need to save enough money to cover all of your expenses, which can be a tough task. But while your savings are a very important part of your retirement planning, money isn’t the only factor to focus on.

As you age, the chances of needing assistance with your daily living activities increase, and if you need this care, it can be quite costly. You don’t want those expenses to eat into your retirement income, so planning for the future should include the possibility of needing long-term care. And that’s where long-term care insurance comes in. 

Long-term care insurance helps cover the expenses related to these types of services, whether you need skilled nursing, occupational therapy or help with dressing and eating. As such, this type of coverage can be a crucial component of your retirement plan. But before you purchase a long-term care insurance policy, it’s essential to ask the right questions to make an informed decision.

Ready to get started? Learn more about your long-term care insurance options here.

8 smart questions to ask before buying long-term care insurance

Don’t purchase a long-term care insurance policy before asking these important questions:

What does the long-term care insurance policy cover?

Understanding the coverage of any insurance policy is vital — and that goes for long-term care insurance, too. Before you purchase a policy, be sure to inquire about the specific services and facilities covered, such as nursing homes, assisted living, home healthcare and adult day care. You should have a clear understanding of what is included and excluded from the policy to ensure that it aligns with your needs and wants. Otherwise, the policy may not do much good if you need it in the future.

Find out what long-term care insurance options are available to you here.

When should I purchase my long-term care insurance policy?

The timing of a long-term care insurance policy is crucial, as your premiums (and policy approval) are based in large part on your age when you apply. So, be sure to explore when it’s best to buy a policy, as waiting too long may result in higher premiums or potential health issues affecting eligibility. Early planning can be more cost-effective, and in many cases, the younger you are when you apply, the lower your policy costs will be.

How much coverage do I need?

Determining the amount of coverage you need is also an important part of purchasing a long-term care insurance policy. If you have too much coverage, you could be paying for benefits you don’t need, but if you have too little coverage, you could end up paying a lot more out of pocket than expected if you need to use your policy in the future. 

To determine how much coverage is necessary, you may want to assess your potential long-term care needs based on factors like family health history, lifestyle and personal preferences. It may also help to consider your financial situation and decide whether you want your policy to cover the entire cost or just a portion of it.

What is the benefit amount and benefit period?

Before you purchase a policy, be sure to determine the maximum daily or monthly benefit the policy provides and the total benefit amount over the policy’s lifetime. Understanding these details will help you gauge whether the coverage aligns with your potential long-term care costs — and if it doesn’t, you can move on to a policy or insurer that better aligns with what you want and need.

Are there inflation protection options?

Inflation issues can erode the value of your coverage over time, as rising healthcare costs caused by inflation can quickly outpace the coverage your policy offers if you aren’t careful. Luckily, many issuers offer inflation protection options as part of their policies, which typically increase your policy’s benefit amounts to protect against the rising cost of care. 

So, as you shop for a policy, be sure to inquire about any inflation protection options offered by the insurer. This may be especially important if you’re purchasing a policy when you’re young and less likely to need quick access to your policy benefits.

What are the waiting or elimination periods?

The waiting or elimination period tied to your policy is the time you must wait after becoming eligible for benefits before coverage kicks in. Nearly every long-term care insurance policy will have some time-based restrictions in place prior to your coverage being active, and it’s important to understand how that works for any policy you’re considering. As you search for the right coverage, be sure to ask about the duration of the waiting period and how it may impact your out-of-pocket expenses during that time.

Is home care coverage included?

Many people prefer receiving care in the comfort of their homes rather than in a nursing home or assisted living facility. If you would prefer to be at home for your care, be sure to check whether the policy covers home care and find out if there are any restrictions or conditions associated with it.

Are there additional riders or customization options?

You should also explore any additional riders or customization options available with the policy. This could include features like shared care, where couples can pool benefits, or a return of premium rider if benefits are not used.

The bottom line

Purchasing long-term care insurance requires careful consideration and a thorough understanding of the policy’s terms and conditions. By asking the questions outlined above, you can make an informed decision that aligns with your long-term care needs, financial situation and personal preferences. So, take the time to research and compare policies to find the one that provides the best coverage for you.

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