Long Term Care Insurance: How Do You Know if it’s a Smart Decision to Buy?

If a senior has an extended stay in a nursing home, it can financially devastate them and suck up all of their assets. Living in a nursing home costs tens of thousands of dollars a year, and it’s not getting any cheaper. Fortunately you can hedge against this cost by purchasing some quality long term care insurance and keep your inheritance in place for your children, and your children’s children.

Long term care insurance does not make sense for everyone. If you’re under the age of 50, there’s no reason to get long term care insurance. People under the age of 50 are usually still in relatively good health and the likelihood of them needing to be in a nursing home is very unlikely. Even if your work is offering it at very inexpensive rates, just don’t bother. It would be like buying hurricane insurance in rural South Dakota, you just don’t need it.

Another case where long term care insurance doesn’t make a lot of sense is if you’re either extremely wealthy, or are as close to broke as one can be. If you have a lot of assets, say several million dollars, you’ll easily be able to absorb the cost of a nursing home. If you’re dirt broke, you don’t really have any assets to protect and you’ll qualify for a Medicaid or Medicare paid stay.

Purchasing long term care insurance makes great sense for their people in their late fifties and sixties. This is the age that you can buy it at where you’ll get a great deal and start having any sort of real need for long term care insurance. If you wait until your 70’s or even 80’s, you’ll have to pay much higher premiums for long term care insurance.

Make sure you go with a quality company. There are some less than stellar companies which make it very hard for you to get paid if you’re in a situation where you need long term care. AM Best has rated the following companies with an A++ rating: John Hancock Life Insurance Co, MassMutual Financial Group, State Farm Life Insurance, USAA Life Insurance, Northwestern Mutual Life, and New York Life. Any of these companies would be great to go with for long term care insurance. You’ll want to get a few different quotes to make sure that you’re getting the best deal, but these are all quality companies in terms of the long term care products offered.