How Much Long Term Care Insurance Coverage Do I Need?

If you decide to purchase a long term care insurance policy, a question you may have is how much coverage do I really need? You first have to determine the type of long term care you want such as a nursing home, assisted living, home health care or other service. Find out how much these services cost in your area. This will give you an idea of how much coverage you need. For example if you want to stay in a nursing home, and nursing homes in your area are currently running $100 a day, you will want to purchase a policy with a daily benefit close to, or more than, that amount. If you have a daily benefit of $80, you'll have to pay anything in excess of that. If you know you will have some money set aside you may be able to handle a small amount of long term care expense. The policy should also be inflation protected.

The average stay in a nursing home is about 2 years. About 10 percent of nursing home occupants stay longer than 5 years. If you are a woman, there's a chance you'll live longer than the average man and may need long term care for more than 2 years. However, the length of time you'll need these services is really hard to pinpoint. You'll have to consider your own circumstances.

However much coverage you decide to purchase, be sure to get multiple quotes from long term care insurance companies to see who offers the best rate.

Sources

Common Long Term Care Myths. Retrieved April 23, 2008, from http://www.ltcfeds.com/start/aboutltc_myths.html
Long-Term Care. (2007). Retrieved April 23, 2008, from http://www.medicare.gov/LongTermCare/Static/Home.asp