I’m in My 70s and Need Long-Term Care Insurance. Is It Hopeless at My Age?

Most Americans will need long-term care at some point, but according to insurance research company LIMRA, only 3% of Americans over age 50 have long-term care insurance.

Among those aged 65 and older, 14% will eventually incur out-of-pocket costs of over $100,000 for long-term care (LTC) services — which Medicare typically does not cover.

And the longer you wait to invest in LTC insurance, the harder it is to avoid those out-of-pocket costs.

That brings us to a recent question from a Money Talks Newsletter subscriber.

Bill M. asked Money Talks News:

“I would like to know the best insurance companies that offer long-term care insurance for individuals over 70 years old.”

We can’t recommend specific insurance companies, as we don’t know all the particulars of Bill’s financial and health situations. But we consulted financial experts for advice on navigating long-term care insurance at Bill’s age.

Here’s what they had to say.

Don’t expect it to be cheap or easy

Buying long-term care (LTC) insurance in your 70s can be tricky, but it’s not impossible, according to Josh Brooks, a certified financial planner with Exponential Advisors.

“The most significant factor in the price of long-term care insurance is the age you buy it,” Brooks tells Money Talks News. “Premiums for a 70-year-old will be significantly higher than for someone who bought a policy in their 50s.”

That assumes an insurer is willing to offer you coverage, though.

According to the American Association for Long-Term Care Insurance, your chances of being denied long-term care insurance rise with age. In 2019, 44% of applicants aged 70 to 74 were denied, and 51.5% of those 75 or older were denied.

The older you are, the more likely you are to have pre-existing conditions, which can make approval for standard LTC insurance policies harder to obtain.

“Buying long-term care insurance at age 70+ is going to be tough and expensive,” says Bill Shafransky, a certified financial planner with Moneco Advisors. “That type of insurance is underwritten with strict health guidelines, as the insurance carrier assumes a probability of paying the high cost of care, which usually occurs in somebody’s early 80s.”

“[F]or most companies selling Traditional policies, you have to be a specimen of health to get approved,” Shafransky continues.

Certain health conditions will make it “impossible” to get approved, according to the American Association for Long-Term Care Insurance. Those include — but aren’t limited to — memory loss, kidney failure and liver cirrhosis.

If age and health don’t work in your favor, though, there are other options.

Consider alternatives

Brooks shared a few alternatives to traditional policies that someone in Bill’s predicament could consider:

• Hybrid policies: These pair life insurance or an annuity with long-term care coverage. They’re often simpler to qualify for than traditional long-term care insurance. A key benefit is that if you never end up needing care, your beneficiaries still receive a death benefit.
• Short-term care plans: These policies provide coverage for a limited duration, typically up to about a year, Brooks says. Medical underwriting is usually more lenient, and it can help shield your assets from the cost of a brief but intensive care need.
• Paying out of pocket: This involves covering care costs directly from your personal assets. It demands significant savings and intentional planning, but it gives you the greatest control over how and where you receive care.

Another alternative is long-term care annuities.

Ultimately, everyone’s situation is different, so it can be helpful to meet with a professional.

Other advice

There are a few questions you should answer before you start shopping around, says Harold Zazula, a certified financial planner with a certification in long-term care.

“Before tackling how to finance long-term care, it is necessary to know what kind of care you want, where, and from whom. Then build a funding plan around that, with LTC insurance as a possible component,” Zazula tells Money Talks News.

Zazula and other experts shared the following tips to keep in mind while navigating LTC insurance:

• Set realistic expectations about your health, your family’s medical history and how that’ll impact insurance.
• Calculate your retirement budget and then gauge what you can afford to add to your monthly payments.
• Shop around for policies instead of looking at only one option.
• Read the fine print before signing anything. How much would these policies cover per day, and for how long? Does the coverage protect against inflation? Know the details.
• Learn the difference between traditional, hybrid and chronic care riders.
• Understand how claims are paid, and the difference between reimbursement and indemnity.