[Last updated January 8, 2024]
As people age, it’s important to consider a long-term care insurance policy. Long-term care insurance covers long-term care services that typically aren’t covered by health insurance and that support quality of life, like assistance with daily living activities. Having a long-term care insurance policy in place can give you peace of mind in knowing that you can receive the care you might need in the future without worrying about how to cover it. Here, we explore the best long-term care insurance companies and what makes them great. We’ll also describe essential terms and concepts so you can know the basics when you enter the long-term care insurance conversation with a potential provider.
What is long-term care insurance?
Long-term care insurance covers necessary services that regular health insurance does not for those with needs caused by aging, chronic illness, disability, or a disorder such as Alzheimer’s disease. Under most policies, a person becomes eligible for long-term care benefits when they can no longer do two activities of daily living (ADLs) independently.
Once eligible, a person can receive services in their home, a nursing home, an assisted living facility, or an adult day care center. Some of these policies may cover staying at an assisted living facility.
Adults considering long-term care insurance should start preparing in their 50s as a part of their long-range financial plans. Most providers will not approve applications of those who have a preexisting condition or are over 75. Some policies limit the services provided or their duration, while others extend through the policyholder’s lifetime.
Top long-term care insurance providers
Many reputable providers offer long-term care insurance, each with competitive pricing, multiple levels of coverage, and different policy types. Here are some of the nation’s best long-term care insurance companies.
Great for discounts: Northwestern Mutual
Established in 1857, Northwestern Mutual is one of the best financial services mutual organizations in the U.S. They offer high-quality long-term care insurance through Northwestern Long-Term Care Insurance Company in Milwaukee, Wisconsin.
Northwestern Mutual offers a stand-alone long-term care insurance policy as well as a hybrid policy that combines life insurance with long-term care insurance. The company also provides great discounts (up to 30% off) for couples. Its stand-alone policy is called QuietCare, a reimbursement-style policy that allows clients to customize their total policy value, benefit period, elimination period, and maximum monthly benefits. With the QuietCare policy, you can choose from a wide range of maximum monthly benefit amounts and elimination period options to best suit your needs. Other pros of this insurance policy include inflation protection, survivorship benefits, and paid-up nonforfeiture benefits.
Best policies with no waiting period: Lincoln Financial Group
Lincoln Financial Group has been in business since 1905 and offers different hybrid long-term care insurance plans with no waiting period. These are universal life insurance plans with an optional long-term care benefit rider accessible from the beginning of the policy.
Its MoneyGuard policies offer zero-day elimination periods for accessing coverage to nursing homes and assisted living facilities, allowing customers to receive benefits instantly. The MoneyGuard II and MoneyGuard Fixed Advantage plans do not require medical exams or lab tests for underwriting.
Lincoln Financial Group offers flexibility for its customers. Its policies offer couples discounts, making long-term care insurance more affordable for you and your partner. The agency has also been known to approve applicants up to age 80, whereas many providers will deny customers older than 70.
Best for discounts: Mutual of Omaha
Formed in 1909, Mutual of Omaha offers the best discounts for long-term care plans. The company has three premium discounts: 15% for partners who purchase the same policy, 5% for married customers whose partner is not under the same policy, and 15% for people in good health. The couples discounts are available only for partners who have been married or living together for at least three years.
Unlike some insurance providers, Mutual of Omaha offers long-term care insurance as a singular plan, exclusive from any life insurance policy. The benefit period can potentially be unlimited, so you may be able to use the benefits for as long as you need them. Mutual of Omaha policies offer a range of total policy benefit amounts and maximum monthly benefits — so you’ll be able to choose a policy that suits your needs. You can also choose from various elimination periods to accommodate how long you’re willing to wait for your benefits to kick in.
Best for seniors: New York Life
Founded in 1845, the New York Life Insurance Company is the largest mutual life insurance agency in the United States. New York Life offers different types of insurance policies: a combination long-term care plan and a larger life insurance benefit. The combination policy provides long-term care benefits and pays out a death benefit if a policyholder passes before using their long-term care benefits. This plan also has fixed premiums that will never increase.
The traditional larger life insurance plan is better for those who want the most coverage per dollar. Choosing this policy will give the insured more options for care and protect their assets and income during retirement.
You have options regarding the benefit period, maximum daily benefit, and elimination period. Depending on your policy and the plans available in your area, you may also be eligible for a couples discount.
Best overall: Nationwide
Nationwide is one of the largest insurers in the United States, with a reputation for its high quality of customer service. Nationwide offers universal life insurance policies that have a long-term care rider — an addition to a life insurance policy that allows the insured to use the policy’s death benefit for long-term care while they’re alive. A person can pay for long-term care services not covered by health insurance, such as a home health aide or a long-term care facility.
The benefit period to access a Nationwide long-term care rider is between 25 and 50 months. The maximum benefit will vary based on each customer’s policy; the elimination period is 90 days.
As you search for the long-term care insurance policy that best fits your needs, you may come across unfamiliar terms. We break these down for you clearly below so you can make the best decision for your situation.
Essential terminology for long-term care insurance
When navigating the world of long-term care insurance, understanding the terminology is key to making informed decisions. Here are some essential terms to know:
Activities of daily living (ADLs): These are the basic tasks of everyday life, such as eating, bathing, dressing, toileting, transferring (moving to or from a bed or chair), and continence. The inability to perform a certain number of ADLs typically triggers the benefits of a long-term care policy.
Benefit period or duration: This term refers to the length of time during which benefits are paid. Common duration periods are two, three, and five years or lifetime coverage. The longer the benefit period, the higher the premium is likely to be.
Elimination period: Often referred to as the waiting or deductible period, this is the amount of time that must pass before the insurance company starts paying for care. It can range from zero to 100 days or more; longer elimination periods usually result in lower premiums.
Inflation protection: This optional feature increases the benefit amount annually to keep pace with inflation. This can be a fixed percentage or based on a consumer price index.
Maximum daily/monthly benefit: This is the highest amount that the policy will pay per day or month for care. This amount can vary based on the policy and the options you select.
Nonforfeiture benefits: If you let your policy lapse, this feature may provide some level of benefit. It’s an optional feature that typically increases the cost of the policy.
Underwriting: This is the process by which insurers evaluate the risk of insuring a potential customer. It involves assessing the applicant’s health and medical history.
Hybrid policies: These are policies that combine long-term care insurance with another form of insurance, such as life insurance or an annuity.
Understanding these terms can help you better navigate the complexities of long-term care insurance and choose a policy that best suits your needs and financial situation.
If you’re considering purchasing long-term life insurance or making a claim on your long-term care insurance policy to pay for senior care, contact ElderLife Financial. We can help assist in providing you or a loved one with financing for senior living expenses. Reach out today to learn how we can support you.
