Long Term Care Insurance is private insurance designed to help pay for nursing home or home health care expenses. It is available to individuals and may be available under a group policy. You pay a premium to an insurer in return for protection against the high costs of long-term care. Long-Term Care can be expensive; especially for retirees living on a fixed budget. The sobering reality is that one-in-three Long-Term Care policy holders will wind up using their Long-Term Care policy at some point in their retirement.

At least 70% of people over 65 will require long term care services at some point in their lives acording to National Clearing House for Long Term Care Information (a service developed by the U.S. Department of Health and Human Services).  It is estimated that at least 10 million Americans are currently in need of long term care services and support and this figure is projected to increase to 15 million by 2020.

Check out the Long-Term Care Cost Calculator to check costs depending on where you live, etc.
http://media.nmfn.com/tnetwork/LTC_Calc/index.html

Click this link to give you the information to assess your need for long-term care, calculate the costs, and see if a long-term care policy will be right for you. http://freeseniorcitizenssolutions.com/long-term-care.html. If you're considering buying a long-term care policy, be sure to do your homework first.

A long-term policy is supposed to pay for in-home, assisted living or nursing home care. Typically, benefits will be triggered by diminished mental ability, as with Alzheimer's, or if you can't perform activities of daily living: walking, dressing, bathing or eating, for instance. Many insurers spell out a list of activities; you must be unable to do a certain number of them for benefits to kick in.

The cost of premiums depends on the insurer, as well as the policy's provisions. Some provisions will affect your price more than others. Typically, you can't get a long-term policy after age 79.

Yearly premium costs

According to the American Association of Long Term Care Insurance the cost for a 55 year old couple in 2011 (including discounts for good health and being married) is about $2350 a year. The cost for a 65 year old couple is about $4550 a year. 

• Daily benefit. A policy that pays $100 a day costs less than one that pays $200 a day.
• Length of benefit. You can buy policies that pay for one year, three years — or as long as you need them. The longer the benefit, the more you pay.
• Waiting period. A policy that kicks in as soon as you need it will cost more than one that won't start until you've paid for 30, 60 or 90 days of long-term care yourself.
• Health. If you're in good health, you can often get a discount. If you're not, you may not be able to get long-term insurance at all.
• Features. Many policies offer an inflation feature; your benefits will be adjusted up for inflation every year. Typically, a policy whose inflation feature is linked to the consumer price index is cheaper than one that awards a flat 5% inflation boost to benefits each year. If you're worried about cost, opt for a policy that pays out for three years. The odds are good you won't need more than three years. A recent study found that just 8% of claimants with three-year payout policies exhausted their benefits, says the long-term care association.

Similarly, you might opt for lower daily payouts. That's because you might be able to count on Social Security, or your own savings, to make up the gap.

What People Pay For Long-Term Care Insurance

Premium Amount Under Age 61 Age 61-75 Age 76 And Older
Less than $500                 2.0%       0.2%           0.9%
$500 - $999                       26.1%     9.5%          9.8%
$1,000 - $1,499                 15.4%    11.3%       11.4%
$1,500 - $2,499                 24.1%    31.6%       19.5%
2,500 - $3,499                   11.8%    20.7%       24.0%
$3,500 - $3,999                   3.3%      6.4%          6.8%
$4000 and Over                   6.0%    14.9%       28.2%

Source: American Association of Long-Term Care Insurance

Your choice of coverage should depend on a variety of factors, says Joseph Matthews, author of Long-term Care: How to Plan and Pay for It. If Alzheimer's runs in your family, consider opting for unlimited benefits.

Why long term care insurance is so important

Caregiving takes its toll on retirement savings Nearly three in four family members serving as primary caregivers to loved ones report a reduction in their savings plans as a result of a long term care event, according to Beyond Dollars: The True Impact of Long Term Caring, a study released by Genworth Financial. Of these respondents, 80% report decreasing their retirement contributions, Genworth said in a release. The findings also reveal that nearly half of primary caregivers have lost a job or missed career opportunities as a result of family care giving responsibilities.
Learn more about the study at www.caringtalk.com.

Long-term care cost have increased substantially since 2002
     The 2011 average cost of a private nursing home room ($235 a day/$85,775 annually) has risen an average 3.5 percent per year since 2002.
     The 2011 average cost of a semi-private nursing home room ($207 a day/$75,555 annually) has risen an average 3.2 percent per year since 2002.
     The 2011 average cost for a month in an assisted living facility ($3,270 a month/ $39,240 annually) has risen an average 3.4 percent per year since 2002.
     The 2011 average cost for a home health aide ($20 hourly/$37,440 annually) has risen an average 1.3 percent per year since 2002.
Source: John Hancock Financial

Long Term Care Insurance Costs

If you are interested in checking the cost of various long term care policies go to the Federal Long Term Care Insurance Program: www.ltcfeds.com/ltcWeb/do/assessing_your_needs/ratecalcOut Here you can enter your age, the daily benefit amount you wish to receive, the length of time you will continue to receive benefits and the waiting time before the benefits will start and your premium will be shown.

For example if you are 60 years old and want insurance that will pay you $200 a day for up to 5 years with a waiting period of 90 days before payments start, the cost is estimated at $243.64 per month with a maximum total lifetime payment  of $365,000. This quote includes a 4% inflation option.

Here are Matthews' main tips for buying long-term care insurance:

• Buy from an established national company with financial strength. You can obtain ratings for most insurance companies from A.M. Best, an insurance evaluator: www.ambest.com. Remember: You're buying a policy you may not need to use until 2020 or beyond; you want the insurer to stick around.
• Look for flexibility. Make sure your policy will pay for home health care, nursing home care, or even respite care, which gives caregivers a break. Also be sure the policy will cover Alzheimer's and other long-term cognitive disorders
• Buy the inflation rider. A payout of $100 a day would be worth only $76 a day after 10 years of 3% annual inflation.
• Shop around. Insurers have the right to change premiums. Don't just look for the lowest initial premiums. Insurers with low prices now might raise rates later.
  Should you buy long-term care insurance? It depends. The odds of spending many years in a nursing home are fairly low if you're in good health and have no family history of Alzheimer's or stroke. But if you fear being a burden to your family, or if you don't want to wind up in a nursing home paid for by Medicaid, you might consider a long-term care policy.

"There's no sense in buying long-term care insurance if you're not paying your bills or funding your retirement," says Gregory French, an elder law attorney in Cincinnati. Statistics show that at least 6.4 million people aged 65 or older need long-term care, with one in two over age 85 requiring care. At least half of the population who are 85+ will need help with Activities of Daily Living.*

Such care is provided when someone can no longer independently carry out essential everyday activities like eating, bathing, dressing, etc. Most people think of long-term care as something needed by older people, but accident or illness can strike someone of any age. When it does, they too may find themselves in need of assistance.

Traditionally, women in our families have provided this care when needed. However, today’s smaller families may be scattered across the country, and many women are now working outside the home. What’s more, caring for a loved one full-time can overwhelm even the most devoted family member. As a result, more caregivers than ever are turning to outside resources to help with the care of a family member.

Many people automatically think of nursing homes when they think of long-term care, but there are other options available as well, some provided in your own home or others in the community. This pamphlet* explains some of these long-term care arrangements, what they cost and how to shop for a long-term care insurance policy to help cover such expenses.
*Planning for Long-Term Care