Saving Money On Long-Term Care Insurance

Insurance Premiums
The typical response from those considering long-term care insurance is that it’s “too expensive.” Although long-term care insurance policies usually cost between $800 and $2,400 per year, having to pay for care out of pocket is more costly!

There are several ways you can save on long-term care insurance premiums.

1. Buy Young
Because premiums are age based, the younger you are, the less they will be. It’s that simple! AND, the longer you pay, the less out of pocket and the more your benefits will be than someone who waited. LTCi is a lot like a mortgage with level payments and increasing value over time.

2. Look for Discounts
Many different types of discounts apply to long-term care insurance policies, which can help you save a lot on premiums if you qualify:

• Spousal, domestic partner and family discounts
• Preferred discounts - most likely at younger ages
• Group discounts - as few as three can qualify as a group
• Employer discounts even if only one of five employees applies

3. Consider Co-Insurance
If you choose to co-insure part of the cost of your long-term care, you can significantly reduce your premiums. For example, if you lower your daily benefit by 30% and pay the rest out of pocket, you will be able to reduce your annual premium by that same amount.

4. Pay Premiums Annually
You can save approximately 8% a year by making an annual lump sum payment each year on your policy’s anniversary date as opposed to paying monthly. The carrier will send you a reminder each year so you don’t forget!

5. Pay Premiums Tax Free
Use an already taxed account with taxable gains to pay your LTC insurance premium taxfree! This is a recent development (2010) due to provisions of the Pension Protection Act.

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