Let's be honest: thinking about long-term care isn't exactly fun. But here's something that might surprise you—waiting too long to buy insurance for it can cost you thousands of dollars more each year. The difference between buying a policy at 55 versus 65? That could be an extra $1,000 to $2,000 annually for the exact same coverage.
The reality is that most of us will need some form of long-term care in our lifetime—whether that's help at home, assisted living, or nursing care. And without insurance, those costs can devastate your retirement savings. A year in a nursing home can easily run $100,000 or more. So the question isn't really whether long-term care insurance costs money. It's whether you can afford not to have it.
What You'll Actually Pay: Breaking Down the Numbers
According to 2024 data from the American Association for Long-Term Care Insurance, a typical policy providing $165,000 in benefits with no inflation protection runs about $950 per year for a 55-year-old man and $1,500 for a 55-year-old woman. If you're married and both purchase policies together, expect to pay around $2,080 combined annually.
But here's the catch: those prices are for policies without inflation protection. If you add 3% annual inflation protection—which most financial advisors strongly recommend—costs jump significantly. A 55-year-old man would pay around $2,075 per year, while a woman the same age faces premiums of about $3,700 annually. Yes, that's nearly double what men pay, and we'll explain why in a moment.
Wait just five years, and the picture changes dramatically. At age 60, that same policy costs $1,200 for men and $1,900 for women—and that's still without inflation protection. Couples purchasing together would pay around $2,600 per year. By 65, you're looking at $1,700 for men and $2,700 for women annually. And if you wait until 75? Premiums can range from $3,600-$7,825 for men and a staggering $6,600-$12,375 for women.
Why Age and Health Are Everything
Think of long-term care insurance like life insurance—the younger and healthier you are when you buy it, the less you'll pay. But there's a crucial difference: with long-term care insurance, waiting too long doesn't just mean higher premiums. It could mean you can't get coverage at all.
Insurance companies look closely at your health history. Certain conditions are automatic disqualifiers—things like dementia, Parkinson's disease, muscular dystrophy, or cystic fibrosis will prevent you from getting a policy. Even conditions that don't disqualify you entirely, like diabetes or heart disease, can significantly increase your premiums or result in coverage exclusions.
Most experts agree the sweet spot for purchasing long-term care insurance is in your mid-50s. You're typically still healthy enough to qualify for the best rates, but you're also at an age where the premiums are reasonable. Buy too early—say, in your 40s—and you're paying premiums for decades before you might need benefits. Wait too long, and you're either priced out or potentially uninsurable.
Other Factors That Affect Your Premium
You've probably noticed that women pay significantly more than men for long-term care insurance. This isn't discrimination—it's actuarial reality. Women live longer on average and are statistically more likely to need long-term care services. A 55-year-old woman might pay 40-80% more than a man the same age for identical coverage.
If you're married or in a committed partnership, there's good news: couples discounts can save you 15-25% on premiums when you both purchase policies. Some insurers, like New York Life, offer discounts as high as 25%. However, these discounts have been shrinking—they used to be as high as 30%, but most companies have reduced them to 15% or even just 5% if only one spouse is insured.
Your premium also depends on the coverage you choose. A policy with higher daily or monthly benefits will cost more than one with lower limits. Similarly, a policy that pays benefits for five years will be more expensive than one with a three-year benefit period. Where you live matters too—insurers base rates on local long-term care costs, which vary widely. Care in New York City or San Francisco costs significantly more than in rural areas, and your premium reflects that.
The Rate Increase Reality You Need to Know
Here's something many people don't realize until it's too late: your long-term care insurance premium isn't locked in forever. Unlike term life insurance, these premiums can and do increase over time—sometimes dramatically.
Rate increases of 50% aren't uncommon, and some policyholders have seen hikes as high as 80-86%. The National Association of Insurance Commissioners reported over 3,500 approved rate increases nationwide in 2021 alone, with an average approved increase of 37%. For federal employees enrolled in the Federal Long-Term Care Insurance Program, 2024 brought the first rate increase in seven years, with some seeing their premiums jump by more than 80%.
Why does this happen? Long-term care insurance is relatively new, and early policies were significantly underpriced. Insurers didn't anticipate how many people would keep their policies rather than letting them lapse, how long people would live, or how much care would actually cost. They also counted on higher investment returns than they've actually earned in our low-interest-rate environment.
When you face a rate increase, you typically have three options: accept it and pay the higher premium, reduce your benefits to keep your premium closer to what you're currently paying, or stop paying premiums entirely and accept a reduced paid-up policy with lower benefits. None of these options are ideal, which is why it's crucial to factor potential rate increases into your budget planning from the start.
How to Get Started Without Overpaying
Shopping for long-term care insurance isn't like buying car insurance online. Premiums vary significantly between insurers—even for the exact same coverage. That's why it's essential to get quotes from multiple companies. Work with an independent insurance agent who represents several carriers and can compare options for you.
When comparing policies, don't just look at the premium. Consider the benefit amount, benefit period, inflation protection, and elimination period—that's the waiting period before benefits kick in, similar to a deductible. A policy with a 90-day elimination period will be cheaper than one with a 30-day period, but you'll need to cover those first three months of care out of pocket.
Most importantly, don't wait. Every year you delay, premiums increase and your health could change in ways that make you uninsurable. If you're in your 50s and in reasonably good health, now is the time to at least explore your options. Get quotes, understand what coverage would cost, and make an informed decision. The worst choice is no choice at all—because one day, you or someone you love will likely need long-term care, and the question will shift from what it costs to whether you can afford it.
