Long-Term Care Insurance Basics

Long-term care insurance pays for services like home health aides, adult day care, assisted living, or nursing home care when someone needs help with basic activities of daily living. It is separate from health insurance, Medicare, and Medicaid, and typically requires proof of inability to perform two or more activities without assistance.

Policies differ in benefit periods (from one year to lifetime), daily benefit amounts, elimination periods (waiting times before payouts start), and inflation protection options. Premiums depend on age, health, benefit choices, and carrier underwriting rules. Some policies include shared benefits for couples or tax-advantaged features.

Buying early—often in the 50s or early 60s—can lower lifetime costs and improve approval chances, but health conditions may lead to denials or higher rates. Riders like non-forfeiture or return of premium add flexibility but increase cost. Policies may also exclude certain conditions or have strict eligibility triggers.