Long-term Care Insurance
What Is Long-Term Care Insurance?
Long-term care insurance is a type of insurance designed to help pay for services that assist individuals with daily living activities when they can no longer care for themselves independently.
These services may include assistance with bathing, dressing, eating, and other personal care needs.
Why It Matters
Long-term care services can be extremely expensive and may not be fully covered by health insurance or government programs. Long-term care insurance helps individuals prepare financially for potential care needs later in life.
It can protect retirement savings from being depleted by long-term care expenses.
How Long-Term Care Insurance Works
Policyholders pay premiums to maintain coverage. If they become unable to perform certain daily living activities, the policy may pay for care services such as:
- nursing home care
- assisted living facilities
- in-home caregiving
- adult day care services
Policies may have waiting periods before benefits begin.
Example
An older adult who requires assistance with daily tasks may use long-term care insurance to help pay for in-home caregiving services.
Long-Term Care Insurance vs Health Insurance
- Health insurance covers medical treatment and healthcare services.
- Long-term care insurance covers assistance with daily living activities and extended care services.
FAQs About Long-Term Care Insurance
Does Medicare cover long-term care?
Medicare generally covers limited short-term care but not long-term assistance.
When should someone buy long-term care insurance?
Many people consider purchasing coverage in their 50s or early 60s.
What services can long-term care insurance cover?
Coverage may include nursing homes, assisted living, or home care.
Related Terms
