Long Term Care Insurance: A Guide to Coverage

Plan Ahead with Long-Term Care Insurance

Long-term care insurance helps cover the cost of extended care when aging, illness, or disability makes it difficult to manage daily activities on your own. Whether you choose traditional LTC coverage or a hybrid policy with added benefits, this protection ensures access to quality care—without placing a financial or emotional burden on your family.

At Diversified Insurance Brokers, we help you understand your options and find a plan that fits your needs, goals, and budget—so you can protect your independence and your assets with confidence.

👉 Get your personalized long-term care insurance quote here

Long-Term Care (LTC) Overview:

What Is LTC?

Long-term care (LTC) refers to a broad range of personal and medical support services for individuals who are unable to care for themselves due to chronic illness, disability, or the effects of aging. These services are designed to assist with Activities of Daily Living (ADLs)—the basic tasks required to live independently.

The six commonly recognized ADLs include:

Bathing – personal hygiene and grooming
Dressing – putting on and removing clothing
Eating – feeding oneself
Toileting – getting to and from the bathroom and managing continence
Transferring – moving in or out of a bed or chair
Continence – controlling bladder and bowel functions

LTC can be provided in a variety of settings, including in-home care, assisted living facilities, nursing homes, and adult day care centers. The primary goal is to help individuals maintain their independence, dignity, and quality of life, while ensuring their safety and well-being.

How LTC Can Help You

Long-term care provides vital support for individuals who need help with daily living activities, enabling them to maintain independence and remain in a comfortable, familiar setting for as long as possible. Whether care is delivered at home or in a facility, LTC services are designed to promote dignity, safety, and quality of life.

For families, long-term care offers peace of mind—knowing their loved ones are receiving the attention and assistance they need. It also plays a critical role in managing chronic health conditions, reducing the risk of injury, and preventing costly hospitalizations through regular supervision and personalized care.

Download our Long Term Care Playbook

Benefits Of LTC

Personalized, Needs-Based Care

Long-term care services are tailored to the individual—ensuring each person receives the right level of support based on their health, lifestyle, and personal preferences. Whether it’s help with daily activities, medication management, or more intensive care, LTC adapts to meet evolving needs with compassion and precision.
Support with Daily Living Activities

Long-term care provides hands-on assistance with essential activities such as bathing, dressing, eating, and mobility. By helping with these day-to-day tasks, LTC enhances comfort, promotes dignity, and improves overall quality of life for those who may otherwise struggle to maintain independence.
Ongoing Medical Support and Monitoring

For individuals with chronic health conditions or disabilities, long-term care offers consistent medical oversight and support. From medication management to regular health monitoring, LTC helps ensure that medical needs are addressed promptly—reducing complications and improving long-term health outcomes.
Emotional Support and Social Connection

Long-term care isn’t just about physical assistance—it also nurtures emotional well-being. Many LTC settings provide opportunities for social interaction, companionship, and meaningful engagement, helping reduce feelings of isolation and supporting mental health as individuals age.
Relief for Family Caregivers

Professional long-term care services ease the physical and emotional burden on family members by taking over the demanding responsibilities of daily caregiving. This allows loved ones to focus on what matters most—spending quality time together, maintaining their relationship, and providing emotional support without being overwhelmed by constant care duties.

Traditional vs. Hybrid Annuity/Life Long-Term Care

Traditional Long-Term Care Insurance

Coverage

Traditional LTC insurance is a standalone policy created specifically to cover the cost of extended care. It provides benefits for a wide range of services, including in-home care, assisted living, nursing homes, and adult day care. These policies are typically comprehensive, offering flexibility in how and where care is received.

While traditional policies often come with lower premiums than hybrid options, they usually follow a “use-it-or-lose-it”model—meaning benefits are only paid if care is needed.
Premiums

These policies typically require the payment of ongoing premiums, which may increase over time. One important consideration is that if the policyholder never requires long-term care, the premiums paid do not provide any return of value—a structure often referred to as “use-it-or-lose-it.” This makes traditional LTC insurance a strong fit for those primarily focused on cost-effective protection, but it may not appeal to individuals seeking added financial flexibility or value if care is never needed.
Use-It-Or-Lose-It

One notable drawback of traditional LTC insurance is the lack of financial return if care is never needed. Unlike some other forms of insurance, traditional LTC policies generally do not offer a cash value or refund feature. This means that if you never require long-term care, the premiums you’ve paid may not be recoverable—making it important to weigh this risk against the potential benefit of having comprehensive coverage in place.

Hybrid Annuity and Life with Long-Term Care Benefits

Coverage

Hybrid LTC policies combine long-term care coverage with either a life insurance policy or an annuity, offering a flexible alternative to traditional standalone coverage. If long-term care services are never needed, the policy still provides value—typically through a death benefit (in the case of life insurance) or an income stream (with annuity-based plans).

This structure ensures that your money is never “wasted,” making hybrid policies appealing for individuals who want long-term care protection but also guaranteed financial return if care is never used.
Premiums

Hybrid policies typically require either a single lump-sum payment or a scheduled series of payments over time. While the upfront cost is often higher than traditional LTC insurance, the tradeoff is predictability and value—the policyholder is guaranteed to receive some form of benefit.

If long-term care is needed, the policy provides dedicated LTC coverage. If it’s not, the value is returned in the form of a death benefit to beneficiaries or, in some cases, through a cash value or refund feature—making hybrid LTC a compelling option for those who want protection with a built-in financial safety net.
Income Provisions

Hybrid LTC policies—whether based on life insurance or annuities—can be structured to provide benefits on either a single life or joint life basis. This flexibility allows couples to tailor coverage to their needs, ensuring that one or both spouses are protected. For joint policies, benefits continue as long as either spouse requires care, making hybrids a versatile and efficient solution for couples planning together for the future.
Liquidity

Unlike traditional LTC insurance, hybrid policies often include built-in liquidity features, allowing policyholders to access a portion of the policy’s cash value if needed. This added flexibility can be especially valuable in the face of unexpected expenses or changing financial circumstances, offering greater control over your assets without sacrificing long-term care protection.

LTC FAQs

What is long-term care insurance?

Long-term care (LTC) insurance helps cover the cost of extended care services that aren’t covered by Medicare or traditional health insurance. This includes assistance with Activities of Daily Living (ADLs) such as bathing, dressing, eating, toileting, and mobility—whether care is provided in a nursing home, assisted living facility, or at home. This is generally the more common method of planning for care needs, opposed to the alternative option of Short Term Care.
When is the best time to purchase long-term care insurance?

The ideal time to purchase LTC insurance is typically in your 50s or early 60s. At this stage, premiums are more affordable, and you’re more likely to qualify for coverage based on your health. Waiting too long can lead to significantly higher costs—or even a denial—if medical conditions develop.
What does long-term care insurance cover?
LTC insurance covers a wide range of services designed to support individuals who need help with daily activities due to age, illness, or disability. Covered services typically include:

Home health care

Assisted living facilities

Nursing home care

Adult day care services

Hospice care

Memory care for Alzheimer’s or other forms of dementia

These benefits help ensure that care is delivered in the setting that best suits the individual’s needs and preferences.
Does Medicare cover long-term care?

No, Medicare does not cover most long-term care needs. It only pays for short-term skilled nursing care after a qualifying hospital stay. It does not cover custodial care, such as help with bathing, dressing, or eating—services that make up the majority of long-term care.

Medicaid may help cover long-term care costs, but only for individuals who meet strict income and asset requirements, often requiring significant financial spend-down before eligibility.
How much does long-term care cost?

The cost of LTC insurance varies based on several factors, including your age, health, benefit amount, benefit period, and whether you add inflation protection. Premiums typically increase with age, so applying earlier can result in significant savings.

On average, premiums can range from a few hundred to several thousand dollars per year, depending on the level of coverage and the options selected.
What’s the difference between traditional and hybrid long-term care insurance?
Traditional LTC Insurance
A standalone policy designed solely to cover long-term care expenses. While often more affordable, it follows a “use it or lose it” model—if you never require care, the premiums paid are not returned.

Hybrid LTC Insurance
Combines long-term care coverage with a life insurance or annuity policy. If LTC benefits aren’t used, the policy provides a death benefit to your beneficiaries or an income stream—ensuring your money isn’t lost.
Can I qualify for long-term care insurance if I have a pre-existing condition?

It depends on the type and severity of the condition. Some insurers may still offer coverage but at higher premiums or with limited benefits, while others may decline applicants with more serious health issues.

Your best chance of qualifying—and securing affordable rates—is to apply while you’re still in good health. At Diversified Insurance Brokers, we help match you with carriers that are more flexible with specific health conditions.
What is the elimination period in a long-term care policy?

The elimination period is the waiting period between when you begin needing care and when your LTC benefits start paying out. It typically ranges from 30 to 180 days, during which time you’re responsible for covering all care expenses out of pocket.

Choosing a longer elimination period can lower your premium—but it also means you’ll need to cover more costs upfront before your benefits begin.
Can my long-term care insurance premiums increase over time?

Yes—traditional LTC insurance premiums can increase if the insurance company receives approval from the state insurance department and can justify the increase based on higher-than-expected claims or costs.

However, hybrid LTC policies typically offer guaranteed premiums, meaning your rates are locked in and will not increase over time. This predictability is one of the reasons many individuals prefer hybrid options for long-term care planning.
Is long-term care insurance worth it?

For individuals who want to protect their assets, maintain control over their care choices, and avoid placing a financial burden on family members, long-term care insurance can be a highly valuable investment.

Without coverage, the cost of care often falls on personal savings, family support, or Medicaid—which may limit your options and quality of care. LTC insurance provides peace of mind, knowing you’ll have access to the support you need without draining your financial resources.
What is a benefit period in a long-term care policy?

The benefit period is the length of time your long-term care insurance will pay for covered services once you begin receiving care. It typically ranges from 2 to 6 years, though some policies offer lifetime coverage.

The duration you choose affects your premium—longer benefit periods come with higher costs but provide extended financial protection. Some policies also include a total benefit amount, which can be used flexibly over time, regardless of how many years it lasts.

No-Obligation Consultation: Let’s Find the Right Long-Term Care Plan for You

Choosing the right long-term care strategy is a personal decision—shaped by your health, financial goals, and family dynamics. Traditional LTC insurance offers lower premiums and dedicated coverage, while hybrid policies provide added flexibility, guaranteed death benefits, and the reassurance that your investment won’t be lost—even if you never require care.

At Diversified Insurance Brokers, we take the time to understand your needs and guide you through the entire process. Our experienced team will help you compare top-rated plans and find the solution that fits your goals and your budget.

👉 Get started today with a personalized quote and expert guidance—at no cost to you.

Need More Information?

We’re here to help you plan with confidence.

Use our Lifetime Income Calculator to explore your retirement options, or complete the form to connect with our expert team. We’ll guide you step-by-step—no pressure, no obligation.

One Click Away from Coverage — Get a Quote or Apply Today for Life Insurance, Annuities, Medicare & More

From instant term life to guaranteed issue policies, fixed annuities to Medicare supplements, we make it easy to compare top-rated options and apply online in minutes. Whether you’re planning for retirement, protecting your family, or exploring long-term care coverage, you’re just one click away from customized protection.

FAQs: LTC Insurance

What is long-term care insurance and what does it cover?

Long-term care insurance (LTCI) helps pay for extended care if you need assistance with daily activities or have cognitive impairment. Covered services can include home health care, adult day care, assisted living, nursing facility care, and caregiver support.

When do benefits start (what triggers a claim)?

Policies generally pay when a licensed professional certifies you can’t perform at least two Activities of Daily Living (like bathing or dressing) without help, or you have a severe cognitive impairment that requires supervision.

What types of LTC policies are available?

There are traditional stand-alone LTC policies, hybrid life/LTC policies, and annuity/LTC designs. Hybrids can provide a death benefit if you never need care, while traditional policies focus purely on care benefits.

How do I choose benefit amount and duration?

Two key levers are your monthly or daily benefit and the benefit period (e.g., 3–6 years or pooled benefits). We align these with local care costs, your budget, and how much risk you want to self-insure.

Do I need inflation protection?

Inflation protection helps your benefit keep pace with rising care costs. Options include 3% or 5% compound, simple increases, or indexed features on hybrids. It raises premiums but improves future purchasing power.

What is the elimination (waiting) period?

It’s the time you pay out of pocket before benefits begin—commonly 90 days for traditional policies. Longer waits lower premiums; shorter waits cost more. Some hybrids use a different structure.

Can couples share benefits?

Many policies offer shared or joint benefit options, letting spouses/partners access a common pool of benefits if one exhausts individual coverage.

Will premiums increase?

Traditional LTCI premiums are not guaranteed and can increase by class with regulator approval. Hybrid policies typically have premiums that are fixed or paid via a single deposit, trading flexibility for price stability.

Are there tax advantages?

Benefits are generally received tax-free when used for qualified long-term care. Premiums may be deductible or reimbursable up to limits depending on your situation and policy type. Consult your tax advisor for specifics.

When is the best time to buy coverage?

Applying in your 50s or early 60s can balance eligibility and cost. Waiting can mean higher premiums or health changes that limit options. We’ll compare designs to fit your age, health, and budget.